CHAPTER 1

The Problem and its Background

Background of the Study

Studies have shown the important role of marketing in the performance of small and

medium enterprises. Gleeson (2019) states that, “Marketing isn’t simply an important part of the

business success – it is the business.” Marketing is important to identify the consumer needs,

how to respond to consumers with ongoing product development, it fins the shortest path

between the consumer and the brand and lastly is it creates campaigns that respond quickly to

consumer preferences. However, there is inconclusive evidence about the impact of the

traditional and digital marketing on the performance of the SME’s. Some scholars have argued

that traditional marketing is more effective to the business performance relative to the digital

marketing.

According to marketing-school.org (2012) traditional marketing provides the most

recognizable type of marketing, encompassing the advertisements we see and hear every day. It

is the rather broad category that incorporates many forms of advertising and marketing making it

a substratum of all the marketing forms we have today. On the other hand, Digital marketing is

widely used to manage different forms of online presence such as social media pages of the

company, mobile applications and online stores; According to Chakrabarti (2017) the said

approach is cost effective than the traditional marketing by just accruing the convenience of

digital marketing to a considerable scope making it reach wider customer base.

However, there is no study that has been conducted from the perspective of the

Philippines in terms of comparing the two marketing strategies on the performance of the small

1
and medium enterprises. Therefore, this only aims to examine and compare the impact of the

Traditional and Digital marketing strategies on the performance of small and medium businesses

in Antipolo City.

Statement of the Problem

This study aims to compare the impact of traditional and digital marketing on the

performance of small and medium businesses in Antipolo City. Specifically, the study will

answer the following questions:

1. What is the business profile of the SME’s in terms of;

1.1 Nature of Business

1.2 Number of Employees

1.3 Years of existence of the business

2. What is the respondent’s assessment of the traditional marketing in terms of;

2.1 Personal Selling

2.2 Printed Advertisements

3. What is the respondent’s assessment of the digital marketing in terms of;

3.1 Social Media Marketing

3.2 Content Marketing

4. What is the respondent’s assessment of their business performance in terms of;

4.1 Financial Performance

4.2 Non – Financial Performance

5. What is the significant relationship between traditional and digital marketing strategies

and the business performance of the SME’s?

2
Hypotheses

The researchers will use the null hypothesis to project initial answer for the questions that

have been raised in the statement of the problem.

H0: There is no significant relationship between traditional and digital marketing strategies

and the business performance of the SME’s.

3
Conceptual Framework

INPUT PROCESS OUTPUT

4
Scope and Limitation

This study will focus on the comparison of traditional and digital marketing on the

performance of small and medium enterprises in Antipolo City. The study will identify the

businesses regarding on how they market their product and the effects of it to the consumer

behavior. Through the study of consumer behavior, people would be more aware of the factors

that contribute to the effectiveness of comparison of traditional and digital marketing. Extraneous

variables are not included to the study.

Significance of the Study

This study is significant because it will benefit the following:

Advertisers. This will give a better idea of how advertisers see digital marketing and

traditional marketing and how well they respond to it.

Business Owners. They will strategize more effectively on how to reach a wider

customer base and apply the things stated in the research to gain better insight of the relation

between the proper application and usage of traditional and digital marketing

Future Researchers. This will help the future researchers as their reference in their

future studies in conducting related topics.

Marketers. This study will help them identify the aspects they need to focus on to have

more effective advertisements. The research will benefit them by elaborating the things they

need to avoid and focus more to the things that the businesses can improve on.

Society. They will understand why customers prefer one product over the other. They

will have enough knowledge on the factors affecting the consumer buying behavior and

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preferences on the usage of aligned marketing tool. Through the feedbacks input of customers,

the type of marketing businesses use can better analyze the feedback and understand the

customer pain point.

Educational Institutions. The study will benefit to the educational institutions on how

they can market or advertise the school that they are in for the admins of the schools. And as for

the students, the study will help them on how they will differentiate small and medium

enterprises.

Definition of Terms

Advertising - the attempt to influence the buying behavior of customers or clients with a

persuasive selling message about products and/or services (Ward, 2018).

Content Marketing – It is defined as a strategic marketing approach focused on creating

and distributing valuable, relevant, and consistent content to attract and retain a clearly-defined

audience — and, ultimately, to drive profitable customer action. (Ruffolo, 2017)

Digital Marketing - Digital marketing is a term that refers to different promotional

techniques deployed to reach customers via digital technologies. It is the promotion of products,

services or brands via one or more forms of digital media. Digital media is so pervasive that

customer has access to information any time and any place they want it. (Santanu, Das, 2016)

Financial Performance - is a subjective measure of how well a firm can use assets from

its primary mode of business and generate revenues. The term is also used as a general measure

of a firm's overall financial health over a given period. (Kenton, 2019)

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 Non-Financial Performance - Non-financial KPIs are not expressed as monetary

values—in other words, they aren’t directly associated with dollar signs. They focus on other

aspects of the business and are often leading (forward-looking) measures, whereas financial KPIs

are lagging measures. (Leconte, N.d)

Personal Selling - Personal selling is where businesses use people (the "sales force") to

sell the product after meeting face-to-face with the customer. (tutor2u.net, n.d)

Print Media Advertisement – Any type of advertisement that is through using printed

media such as flyers, brochures are an example of Print media advertising. In addition are

magazines, newspapers to be able to reach customers, other businesses that is interested in your

business. (Linton, 2019)

Social Media Marketing - Social media marketing, or SMM, is a form of internet

marketing that involves creating and sharing content on social media networks in order to

achieve your marketing and branding goals. (wordstream.com. n.d)

Traditional Marketing – It is a broad category that incorporates many forms of

advertising and marketing. It is the most recognizable type of marketing, encompassing the

advertisements we see and hear every day. It often utilizes television advertisement and printed

ads. (marketing-school.org, 2012)

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 CHAPTER 2

Review of Related Literature

Local Literature

Previously, it is said that people prefer traditional marketing because they create

relationship and extend partnership that can help them not only to gain profit but to gain future

investors and wide brand awareness.

Personal selling involves two-way flow communication between a buyer and seller, often

face to face encounter, designed to influence a person’s or group’s purchase decision. It remains

a highly human intensive activity despite the use of technology. Accordingly, the people involved

must be managed. According to Keri (2013) personal selling serves three major roles in a firm’s

overall marketing effort. First, salespeople are the critical link between the firm and its

customers. This role requires that salespeople match companies interest with customer needs to

satisfy both parties in the exchange process. Second, salespeople are the company in a

consumer’s eyes. They represent what a company is or attempts to be an are often the only

personal contact a customer has with the company. Third, personal selling may play a dominant

role in a firm’s marketing program. This situation typically arises when a firm uses a push

marketing strategy that directs the promotional mix to channel members to gain their cooperation

in ordering and stocking product. This concept often leads to understanding both seller and

consumer to have a fair exchange of benefits using the face to face selling. Consumer can gain

satisfaction while seller can gain more sales through the patronization of products bought by the

8
consumers. Some people still believes personally on what they see rather than relying on digital

advertisements that can give them false hope and expectation.

Keri discusses the three major rolse on a firm’s overall marketing effort, to be able to gain

satisfaction and to gain more sales through the patronization of products brought by the

consumers.

Furthermore, according to Ingram. T. (2012) more than four decades ago, four basic

approaches to personal selling were identified such as stimulus response, mental states, need

satisfaction, and problem solving. Stimulus response selling is the way of salesperson to furnish

the stimuli from a repertoire of words and actions designed to produce the desired response. The

salesperson attempts to gain favorable responses from the customer by providing cues to

influence the buyer. After the customer has been properly conditioned, the salesperson tries to

secure a positive purchase decision. Second is the mental states selling or the formula approach

that assumes that the buying process for most buyers is essentially identical and that buyers can

be led though certain mental states or steps in the buying process. These mental states are

typically referred to as AIDA (attention, interest, desire and action). Appropriate sales message

provides a transition from one mental state to the next. Third is the need satisfaction selling it is

based on the notion that the customer is buying to satisfy a particular need or set of needs. The

salesperson attempts to uncover customer needs that are related to the product or service they are

actually offering. Lastly, problem solving selling that is focused on the extension of need

satisfaction selling. It goes beyond identifying needs to developing alternative solutions for

satisfying these needs.

As Stated by Ingram, there are four basic approaches to personal selling were identified

such as stimulus response, mental states, need satisfaction, and problem solving. Stimulus

9
response selling is the way of salesperson to furnish the stimuli from a repertoire of words and

actions designed to produce the desired response. For the salesperson attempts to gain favorable

responses from the customer by providing cues to influence the buyer. In addition to this is, As

the critical link between the firm and its customers, salespeople can create customer value in

many ways. For instance, by being close to the customer, salespeople can identify creative

solutions to customer problems. Relationship selling then takes places because customer value

creation is made possible, the practice of building ties with customer needs overtime.

Relationship selling involves mutual respect and trust among buyers and sellers. It focuses on

creating long term customers, not a one-time sale. On the other hand, partnership selling or also

known as the enterprise selling, buyers and sellers combine their expertise and resources to

create customized solutions; commit to joint planning; and share customer, competitive, and

company information for their mutual benefit. This is one of the reason why others prefer

traditional marketing because they create relationship and extended partnership that can help

them not only to gain profit but to gain future investors and wider brand awareness through

different connections contributed by the word of mouth of the consumers.

On the other hand, according to Boone (2013) today’s technology allows people to

transmit memos, reports and drawings quickly and inexpensively over phone lines, cables or

wireless devices. People can subscribe to personalize new services that deliver article summaries

on specified topics directly to their computers or cellphones. They can communicate via social

media, email, voice mail, text messages, video conferencing, and computer networks. Through

social marketing it is much easier for the sellers to reach their customers and potential customers

can also be tapped because of the fast transmission of information regarding the product in just

one click. Through this interactive marketing can happen leading to the conversion of new

10
customers to be an advocate of the products that are being offered. Buyer and seller

communications can be strengthened because of the immediate access of information for the

customers and profit for the sellers leading to fair benefits of both parties.

Align with this is the article that states that through social media marketing it is much

easier for the sellers to reach their customers and potential customers can also be tapped because

of the fast transmission of information regarding the product in just one click. Moreover, among

the most important reasons are price and availability of free shipping. Seller is someone whom

the purchaser trusts is also a very important factor. According to the data presented by

E-Marketer, Inc, (2014) the reasons why consumers choose the online channel is because of the

different factors such as the lower price having a percentage of 59%, Shop from home with 53%,

Shop 24/7 with 44%, Wider variety of products available with 29%, Easier to compare and

research products and offers with 27%, Products that are only available online with 22%, Online

customer reviews with 18%, Better product information available with 7%, Promotion via e-mail

or text 7%, Social Media Influence with 1%.

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Foreign Literature

On the previous content, social marketing or digital marketing became a good alternative

to attract customers without spending a ton of money just to market their product and engage

potential customers. This became an effective and efficient ground for businesses and advertiser

to lessen their expenses and turn it into future investment and current capital said by Kingsnorth.

Also, now that the internet is mainstream, information technology is a part of most business

strategies and the economy is on an upturn, and we are again in a position to expect big changes

in e-business. One reason is that the profitability of many Internet firms renewed confidence in

e-business strategies after the dotcom bust. Another stimulus is the rapid adoption of broadband

services, which allows for faster and more stable Internet connections. Interconnectivity will

increase in both depth and reach. Other important trends include the rise of customer power that

allows the ability of consumers to uncover the truth, share stories about the products or even

search for alternative suppliers that is a reason for the company to improve quality and create a

win-win relationship to the customers. Second is the rise of trust is the reduction in the cost of

maintaining relationships will lead more companies towards selected or fully trust based

marketing approaches, including new tools to customize products and services. and advisors to

help customers make the right decisions. (Moutinho, L. 2013)

Moreover, the internet has spawned entirely new ways to identify and communicate with

customers including search engine marketing, social marketing, behavioral targeting and targeted

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e-mail, among others stated by Laudon and Traver, but also, Product is the key considerations

whether the product can or will be sell online. (Kingsnorth, S. 2016). There are different

consumer behaviors that a marketer should know and understand thoroughly. It largely focuses

on the different motivations and usage habits for the products and an efficient vital to get the

right marketing for the digital age. This helps the customers to achieve their satisfaction through

the product or services that the marketers are offering. This serves as a foundation of good

marketing approach that customers can gain clarity of the advertisement. Price and promotion

will all be influenced by the product. Getting found is only half the battle. Convincing your

prospective customers that your product or service can deliver is the real deal of the digital

marketing Trying to save the customers time and giving them a “hassle free shopping” can

improve the results leading to more gains of sales and profit.

According Mangold and Faulds (2009), social media marketing such as Facebook enables

companies to achieve a better understanding and consideration of customer needs hence build

effective relationships. From the definition of social media as an activity, practices and behaviors

among communities of people who gather online to share information, knowledge and opinions

through conversation, Facebook is seen as a developing platform that can be used by businesses

towards interacting with customers. Through Facebook, small businesses can take the

opportunity of sharing information about the goods and services that they offer and targeted

customers will get to see and comment about it. Also 12 it is an opportunity for these small

businesses to introduce their products and services to completely new clients in the market

(Safko & Brake, 2009). Reaching Wider Range of Customers According to Walsh & Lipinski,

(2009) found that traditionally in marketing their firms; SMEs rely heavily on their personal

contact network. Also economic structures favor larger firms; however, today’s economy is

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distinguished by relationships, network, and information, favoring some of the characteristics of

SMEs. Instead of relying only on their personal contact network, small businesses rely on the

networks of customers as well. Today, these customers can be reached through different social

media tools such as Facebook and able to reach customers whom have never met before by

simply visiting the site in the Facebook.

Through this, numerous marketing opportunities exist for small businesses, namely

networking and word of mouth marketing. Not only do owner-managers of small businesses rely

on their personal contact network, but they rely on the networks of their customers as well. Small

businesses often rely on word of mouth 10 recommendations for new customers. Word of mouth

marketing provides small businesses with an opportunity to give customers a reason to talk about

products, making it easier for word of mouth to take place. Networking is a widely cited

marketing activity for SMEs and is important during their establishment, development, and

growth (Walsh & Lipinski, 2009). Siu (as cited in Walsh & Lipinski, 2009) found that in

marketing their firms, SMEs rely heavily on their personal contact network. The Word of Mouth

Marketing Association (2011) recognizes all word of mouth marketing techniques as being based

on the concepts of customer satisfaction, 11 two-way conversation and transparency. The

association describes the basic elements of word of mouth marketing as: “Educating people

about your products and services; Identifying people most likely to share their opinions;

Providing tools that make it easier to share information; Studying how, where, and when

opinions are being shared; and Listening and responding to supporters, detractors, and neutrals”

(WOMMA, 2011). In 2011, Linkdex, a company that helps businesses increase online marketing

performance, conducted a survey on small and medium-sized businesses in the UK and USA to

find out which marketing tools were most important. Of the companies surveyed, 81%

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considered word of mouth to be the most important marketing tool for SMEs (Straw, 2011).

According to Straw (2011) “The perceptions by companies match the changing ways in which

consumers find information about the products and services they want to buy.” Small firms are

generally at an advantage because their small size makes it easier to get close to customers and

obtain valuable feedback (Gilmore et al., 1999). Such an advantage enables small businesses to

take advantages of the marketing opportunities networking and word of mouth marketing

provide. The impact of social media is that enabling customers to talk to one another is, in a

sense, an extension of traditional word of mouth communication (Mangold & Faulds, 2009).

According to the website of “business.com”, it says that social media tools help

companies communicate with individual consumers, which can in turn help establish long-term

relationships. Social media tools such as forums, blogs, or chat rooms create an interactive

dialogue for companies to engage consumers. However, at the same time, consumers are able to

produce information about a company and educate other consumers about products, brands,

services, and more. Equally important, on the research that the group had searched it provides

evidence of potential advantages of utilizing web pages and social media sites for small

businesses in underserved locations. The findings show that a web presence integrated with

meaningful and sustained social media promotion can have a positive impact on business success

in terms of increased traffic, awareness and revenues. This study has the potential to shed light

on how internet technologies and social media can help struggling small businesses to

communicate cost effectively with customers on a global scale, opening new opportunities for

sales and growth.

Beforehand, as viewed by eMarketer, there is a massive opportunity that is social media,

with approximately 1.73 billion users in 2013 across different platforms, but unfortunately there

15
are even more companies who have not. There is also a common problem that many companies

do not properly utilize the social media sites to go beyond the test of their abilities. On the other

hand, traditional marketing forms include radio, television, billboards, corporate fairs, gifts,

websites and many more (Fill 2005, 610). Companies have gained the ability to use these

different forms of advertising over time, but expect to instantly have a great understanding and

use of social media. Although this would be ideal in all aspects of life and business,

unfortunately it is only a dream that most likely will never be reached. This is why the

researchers have decided to examine and thoroughly compare both of these forms of traditional

marketing and digital marketing. This allows the companies to relate social media to traditional

media in a way that they will be able to learn and compromise to show how traditional marketing

forms of advertisement can be related social media sites, marketing and trends.

The newest tool to allow companies to interact at this level is social media. The reason

why social media is so important to marketing today is it allows companies to not only advertise

but immediately get feedback either by comments, likes, or reposts. Although this is a huge

responsibility for any company because how they market the product will also be the result of

good feedback and wider customer reach for higher percentage of gaining profit and customers.

Kotler and Keller issued that the newest tool to allow companies to interact at this level is

social media. The reason why social media is so important to marketing today is it allows

companies to not only advertise but immediately get feedback either by comments, likes, or

reposts. Although this is a huge responsibility for any company because how they market the

product will also be the result of good feedback and wider customer reach for higher percentage

of gaining profit and customers. Apart from this, the first principle of marketing and sales is

“know thy customer.” Who is online, who shops online and why, and what do they buy. In 2015,

16
around 3.1 billion people of all ages had access to the Internet. About 670 million households

worldwide (almost 32% of all households) have broadband access to the Internet. Online

marketing and advertising spending continues to increase worldwide (by over 15% in 2015),

compared to only about 6% for traditional media marketing and advertising meaning there are

more people attached into online shopping rather than the brick and mortar process of marketing.

On the other hand, video advertising continues to be one of the fast growing formats leading to

mobile, social and local marketing to rapidly expand.

On the final analysis, according to Kuberappaa, YV., & Kumar AHS. (2016) due to

limitations in its dynamics, traditional marketing grab audience attention for short time contrary

to which digital marketing content can engage the audience for long time as it gives valuable

information through variety of channels such as blogs, articles, podcasts, infographics, videos

etc. Traditional marketing offers one-way communication to reach audience with collateral

limitations, digital marketing offers marketers to instantly customize the experience and have

real time communication. This reciprocity among customer leads to big impact in any business.

Expertise in digital marketing influences to implement efficient and effective strategies at right

time. Knowledge and experience also helps to manage content, design and improve website

traffic, enhance social media interactions, which helps to increase visibility in profit, and

customer satisfaction. Planning, implementing and monitoring the digital marketing strategies

require time and timing. Time is essential to measure and monitor the strategies and align them

to the projected period to achieve goals. Digital marketing strategy mainly involve customer

reach, acquisition, conversion (act and convert) and retention (long term engagement) Both

traditional marketing and digital marketing have different approaches and have positive qualities

to reach target market and to gain profit. By combining traditional and digital marketing methods

17
in the digital strategy, expanded reach through multiple channels, interactivity for increased

engagement and to build more personal relationships to retain customers more effectively.

Moreover, Kuberrappa and Kumar said that due to limitations in its dynamics, traditional

marketing grab audience attention for short time contrary to which digital marketing content can

engage the audience for long time as it gives valuable information through variety of channels

such as blogs, articles, podcasts, infographics, videos etc. Identically, according to Das, S.K., &

Lall, G.S. (2016) There are countless ways of marketing products and services. Traditional

marketing methods include print advertisements, such as newspaper ads, billboards and flyers, as

well as television commercials and radio spots. Digital or online marketing methods, which are

becoming increasing popular, include websites, ads on social media, YouTube videos and search

engine optimization (SEO), among many others. The world has transitioned into a very digital

environment. Not only are magazines going digital, many of our daily tasks such as banking

online and much of our reading is done on e-readers. With rise of the digital age it is good to

invest in a digital campaign. Even though traditional marketing still has a place, it is diminishing

in the digitally based world. For today’s businesses, it is imperative to have a website and use the

web as a means to interact with their consumer base. By getting involved with social networking

and managing it carefully, you can build customer loyalty and create a reputation for being easy

to engage with, also by giving exclusive offers to your customers, you are rewarding and

reminding them that you’re not only the brand to engage with but also to buy from. By taking

advantages of such strategies can help you to make your marketing more effective. Through

electronic channels and by posting positive comments, feedbacks about product, you can attract

new customers and build healthy relationship. But, it works in both ways. Happy customers can

help you, but unhappy customer can harm your business very seriously. However regardless of

18
these problems it is reasonable to conclude that digital marketing is on the whole positive

development for businesses and that despite certain dangers its impact upon business has been

largely positive.

The world has transitioned into a very digital environment. Not only are magazines going

digital, many of our daily tasks such as banking online and much of our reading is done on

e-readers. With rise of the digital age it is good to invest in a digital campaign. Even though

traditional marketing still has a place, it is diminishing in the digitally based world stated by Das

and Lall. By the same token, according to Listkova (2015) there are weaknesses that the two

approaches have. In traditional approach, the market has this set of limitation when it comes to

innovating their product as soon as possible, because there are instances that they should wait for

the customers’ feedback. On the other hand, non-traditional or digital approach, the factors to be

considered are the effectiveness and the efficiency use of the information and the technology in

our generation. The research also stated that products and services cannot rely on the internet

platforms and also the traditional marketing approach itself. There are several areas wherein the

traditional and digital marketing can actually be compared first is the cost comparison which

discusses about the cost of marketing, we have to pay in both the terms. In the case of traditional

marketing, we pay for ads in a newspaper, magazines, post emails, broadcasts, banners,

brochures etc. But for the digital marketing you will pay on search engine and social media

marketing ads or he digital marketing company or person who is doing marketing for you.

Second is the audience target. Digital marketing is obvious to reach large audience extent as

compared to traditional marketing. Traditional marketing is limited to local customers and if you

want it to reach more audience, then it would cost double. Whereas digital marketing cost almost

same for reaching a local and global audience. Moreover, digital methods help in targeting only

19
those audiences who are interested in their business, where traditional marketing does not have

that factor. Digital marketing can easily reach more audience in different cities and countries

through campaigns because of the increasing number of people using internet sources. Third is

the Customer’s Trust When someone uses traditional marketing techniques for promotion, he

wouldn’t know if people like their ways or services. They’ll only know when they get feedback

from each one of the viewers. But in digital marketing, one can easily communicate with

customers, get to know about their needs and hence gain the trust of customers. Fourth is the

Growth Analysis it is a major factor for a business to develop. Conversion of viewers into

customers is easy through an online medium as compared to traditional techniques because

people are more alert at online sites as compared to traditional techniques.

One can analyze his business growth while marketing online sources but it is difficult to check in

old methods. Because you don’t get to know how many people are watching to your ads and how

much of them are interested to become your customers, analysis made difficult in case of

traditional marketing. Fifth is the business exposure Digital marketing is two-way

communication. People watch your ads and can communicate with you if they are interested in

your business. Whereas traditional marketing is one-way communication and people hardly

reach to you if they have any queries to ask. Thus, it will lead to reaching more customers

resulting in your business expansion. For the last are Quick results are next in line because

Traditional marketing, as already stated, create trouble to communicate with interested

customers. But digital marketing provides real-time results. We will be able to make customers

quickly by communicating with them whenever they just think to buy your product.

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Synthesis

The researcher has synthesized the following due to the foreign and local literature that

was presented above. The research entitled “Comparative Study between Traditional and

Digital Marketing on the performance of Small and Medium Businesses in Antipolo City”

depicts how traditional and digital marketing differ from one another. According to Listkova

(2015), In traditional approach, the market has set their limitation when it comes to innovation of

products within the period of time given to them because they tend to wait for the customers

rather than considering the formation of strong relationship to create business to customer

relationship making it a factor of effectiveness and efficiency of utilizing all the resources at

hand. The Small and Medium Businesses in Antipolo City is the representation of Ingram’s

research wherein they have already formulated different strategy without the utilization of Social

Media. As to this, business owners have their own competitive marketing strategies that makes

their way of attracting, obtaining and embracing potential customer more optimistic and

acceptable to the industry.

Furthermore, digital marketing reach a wider customer base that allows the business

owners to captivate potential customer and retain customer’s loyalty through the engaging and

appealing way on how they present their marketing strategies. With this, digital marketing can

easily reach more audience in different cities and countries through campaigns because of the

increasing number of people using internet sources. Customer’s Trust can rapidly increase due to

21
the online feedback that are posted by other customer making other people as the extended and

new potential customer of the business. As to this, digital marketing allows the business to easily

communicate with customers, to understand their pain points, get to know about their needs and

hence gain the trust of customers making an intact relationship than traditional marketing.

The growth analysis is a major factor for a business to develop. With the digital age it is

easy to assess and convert the viewers into customers through an online medium as compared to

traditional techniques because people are more alert at online sites.

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 CHAPTER 3

Methodology

Introduction

This chapter aims to describe the research design, research setting, population, sampling

technique and sample, including the research instrument. This will serve as a guide to directly

and accurately establish information regarding the difference of both traditional and digital

marketing. As to this, the credibility and validity of the research paper will be observed through

the research methods and procedure that are mentioned.

Research Design

The researchers made use of the quantitative research method; particularly the

comparative research design. Comparative research is a research design that aims to make

comparisons between different variables or data sets. (Summer, 1995). Typically, this means that

comparative research design identify similarities and differences that enhance individual’s

understanding and awareness. With this, the researcher can better explicate, validate and study

the variables that are being compared to further assess the significant differences and similarities

that are presented.

23
Research Setting

The study will take place at Antipolo City wherein the researcher can widely focus on the

different MSME’s located around the place. As to this, the division of different “Barangay”

areas in Antipolo are presented hereunder.

DISTRICT 1 DISTRICT 2

Bagong Nayon Calawis

Beverly Hills Cupang

Dela Paz Dalig

Mambugan Inarawan

Mayamot San Jose

Muntindilaw San Juan

San Isidro San Luis

Sta. Cruz San Roque

Population

According to official and latest census of Population and Housing (CPH 2010) conducted

by the National Statistics Office (NSO) last May 1, 2010 placed the city’s population of 677,

741. This represents an increase of 6.9% compared to last 2007 census of population conducted

by the NSO last August 1, 2007 which is 633, 971. As to this, the researchers have verified that

for 2010- 2015 the latest release of the National Statistics Office consists of 613 small and

medium businesses in Antipolo City. The said population will be beneficial in terms of

determining all the small and medium businesses within the scope of Antipolo City.

24
Sampling Technique and Sample

The researcher will be using the stratify sampling technique wherein the actual process of

conducting a survey will equally be divided and subject to further analyze the results and give

accurate information regarding the similarities and differences of the variables that are being

presented. As to this, the sample size will be computed using the Slovin’s formula. Hereunder is

the exact execution of formula that the researchers chose.

Slovin’s Formula: n= N/(1+N^e2)

Calculations for Antipolo City respondents: n = 613 /1+613 (0.05)^2

Answer for Antipolo City respondents: 242 respondents

Wherein N = Number of Small and Medium Businesses in Antipolo City

e = Margin of Error of 0.05%

The result of the calculations states that researchers would be needing 242 respondents in total.

Research Instrument

The researchers used a researcher made questionnaire checklist to elicit information from
the respondents following a 1-4 Likert Scale to code the verbal data into numerical data in
preparation for the statistical treatment. The scale is given below:

Numerical Score Verbal Interpretation

4 Strongly Agree
3 Agree
2 Disagree
1 Strongly Disagree

The mean scores of the perception of the different respondents will also be compared and
the results will be interpreted as follows:

25
 Scale Verbal Interpretation
3. 27 – 4.00 Strongly Agree
2. 51 – 3. 26 Agree
1.75– 2. 50 Disagree
1.00 – 1. 74 Strongly Disagree

Data Gathering Procedure

The researchers followed strategic step towards the actual process of gathering the data

through the survey questionnaires that the respondents will be filling out. The researchers made a

letter for the authority to address and inform them what will be the sequence of events during the

time that the researchers will be focusing on the data procedure. With this, all the necessary

person are incorporated to sign the said letter of permission such as Mr. Nicholas Nti, Mr. Dennis

Angelo Mejia and Ms. Paulette Dela Cruz. Afterwards, the researchers compiled all the survey

that have been answered and this will be kept confidential to protect the respondents rights. The

survey aims to target all the residents and actual business owners located in Antipolo City. As to

this, tabulation and interpretation of data will follow. The formulated interview guide are direct

and aligned to the questions established in the survey questionnaire to elicit answers honestly and

accordingly. All the answers prompted are analyzed and unbiasedly interpreted.

Data Processing

The researcher will make use of the Microsoft Excel to encode all the necessary data that

will help determine which marketing strategy is more effective. The researcher will also assign

26
values for each choices to easily determine the breakdown of each choices that have been

established. The data gathered will also be the basis of the researcher whether it is commonly or

rarely used by the MSME’s located in Antipolo City. As to this, all the necessary similarities and

differences will be determined and carefully analyze.

Statistical Treatment of Data

In order for the researchers to answer the research questions regarding the difference of

digital and traditional marketing strategy between Small and Medium Enterprises (SME’s) in

Antipolo City in terms of its chosen marketing platform, strength of the business, weakness of

the business, value and importance of the content that is being marketed. The researcher will be

able to accurately determine this through the usage of percentage / frequency, weighted mean

and regression that will help the business assessment and relationship. Align with this is the

assessment of the significant difference or similarities of both variables that are presented.

27
 CHAPTER 4

DATA ANALYSIS AND DISCUSSION

Introduction

The findings of the study are presented in this Chapter. Chronologically, the presentation

follows the arrangement of the statement of the problems outlined in Chapter 1. Descriptive

statistics -- frequency and percentages were used to analyze the statement of the problem one

which deals with the business profile. Weighted mean was used for the statement of the problem

two, three and four. While Standard Regression were used for the analysis of the statement of the

problem five.

28
 TABLE 1
THE PERECENTAGE DISTRIBUTION OF THE BUSINESSES IN ANTIPOLO CITY
(N =360)

Characteristics Frequency Percentage (%)

Numbers of employee

6-29 employees 209 58.0556

30-99 employees 151 41.9444

Years of Business Existence

Below 3 years 147 41.9444

3-5 years 150 41.6667
Above 5 years 63 17.5000

29
 Nature of Business

Service Business 78 21.667

Merchandising Business 108 30.0000
Manufacturing Business 106 29.9999
Hybrid Business 68 18.18889

Table 1 shows the analysis of the profile of the Businesses in Antipolo City based on the

percentage distribution. The data showed that service business accounted for 78 (21.67%) of the

businesses followed by Merchandising Business representing 108 (30%), Manufacturing

Business that resulted to 106 (29.99%) and Hybrid Business that accounted to 68 (18.18%).

Also, the data showed the number of years the businesses have existed, one hundred and

forty – seven (147) of the businesses have existed below 3 years representing (41.94%), followed

by the enterprises that existed for 3- 5 years (41. 66%). Finally, the business that existed for

above 5 years accounted to 63 (17.50%)

Finally, the number of employees included in the scope of 6- 29 resulted to a frequency of

(58.05%) and the 30 -99 bracket of employees accounted to 151 (41.94%).

30
 TABLE 2.1
PARTICIPANTS’ASSESSMENT OF TRADITIONAL MARKETING: PERSONAL SELLING
PERSONAL SELLING WEIGHTED INTERPRETATION

MEAN (Xw)

1.We use word of mouth in promoting our 3.7 Strongly Agreed

business

2. We usually visit our customers to inform 3.0 Agreed

them about our product/business

3. The business usually updates about the 3.2 Agreed

customers about the incoming

products/services

OVERALL WEIGHTED MEAN OF 3.3 AGREED

PERSONAL SELLING

31
 Table 2.1 presents the participants’ assessment of their traditional marketing. The data

shows that “We use word of mouth in promoting our business” received a weighted mean of 3.7

which is interpreted as strongly agreed. The rest of the items received agreed with the following

weighted means 3.0, and 3.2, respectively. The overall weighted mean for the professional

competency is (3.3) with the interpretation of agreed.

TABLE 2.2
PARTICIPANTS’ ASSESMENT OF TRADITIONAL MARKETING: PRINTED
ADVERTISMENT
PRINTED ADVERTISEMENT WEIGHTED INTERPRETATION

MEAN (Xw)

1.The business usually use flyers in 3.5 Strongly Agreed

promoting our products/business

2. The business use posters in promoting 3.4 Strongly Agreed

products/business

3. The business maximize the usage of 3.4 Strongly Agreed

tarpaulin in promoting their products/services

offered

32
 OVERALL WEIGHTED MEAN OF 3.4 STRONGLY AGREED

PRINTED ADVERTISMENT

Table 2.2 represents the participants’ assessment of the traditional marketing based on

Printed Advertisements. The data shows that “The business usually use flyers in promoting our

products/business” received a weighted mean of 3.5 which is interpreted as strongly agreed. The

rest of the items received agreed with the following weighted means 3.4, and 3.4, respectively.

The overall weighted mean for the professional competency is (3.4) with the interpretation of

strongly agreed.

TABLE 3.1
PARTICIPANTS’ ASSESMENT OF DIGITAL MARKETING: SOCIAL MEDIA
ADVERTISMENT
SOCIAL MEDIA ADVERTISEMENT WEIGHTED INTERPRETATION

MEAN (Xw)

1.Our customers usually contact us through 3.5 Strongly Agreed

our Facebook page

2. The business usually post pictures and 3.3 Strongly Agreed

videos on Facebook/Instagram/Twitter

33
 3. The business keeps the social media 3.4 Strongly Agreed

accounts updated for new promotions.

4. The business accepts suggestions, ratings, 3.5 Strongly Agreed

comments through

Facebook/Instagram/Twitter

OVERALL WEIGHTED MEAN OF 3.4 STRONGLY AGREED

SOCIAL MEDIA ADVERTISMENT

Table 3.1 represents the participants’ assessment of the digita l marketing based on Social

Media Advertisements. The data shows that “Our customers usually contact us through our

Facebook page” received a weighted mean of 3.5 which is interpreted as strongly agreed. The

rest of the items received agreed with the following weighted means 3.3, 3.4, and 3.5,

respectively. The overall weighted mean for the professional competency is (3.4) with the

interpretation of strongly agreed.

TABLE 3.2

PARTICIPANTS’ ASSESMENT OF DIGITAL MARKETING: CONTENT MARKETING

CONTENT MARKETING WEIGHTED INTERPRETATION

MEAN (Xw)

1.The company interacts with our customers 3.5 Strongly Agreed

through our website

2. The business use detailed information about 3.5 Strongly Agreed

the products/services.

34
 3. The business uses digital visual content 3.5 Strongly Agreed

(posters) to advertise their product / services

through social media

OVERALL WEIGHTED MEAN OF 3.5 STRONGLY AGREED

CONTENT MARKETING

Table 3.2 represents the participants’ assessment of the digital marketing based on

Content Marketing. The data shows that “The company interacts with our customers through our

website” received a weighted mean of 3.5 which is interpreted as strongly agreed. The rest of the

items received agreed with the following weighted means 3.5 and 3.5, respectively. The overall

weighted mean for the professional competency is (3.5) with the interpretation of strongly

agreed.

TABLE 4.1
PARTICIPANTS’ ASSESMENT OF FINANCIAL BUSINESS PERFORMANCE
FINANCIAL BUSINESS PERFORMANCE WEIGHTED INTERPRETATION

MEAN (Xw)

1.Cash Flow of our business is above the 3.4 Strongly Agreed

industry average

35
 2. Sales Turnover of our business is above the 3.3 Strongly Agreed

industry average

3. Return on Sales of our business is higher 2.9 Agreed

than the industry average

4. Return on Investment of our business is 3.4 Strongly Agreed

above the industry average

5. Market Share of our business is greater than 3.4 Strongly Agreed

most of our competition

6. The current Net profit of our business is 3.5 Strongly Agreed

above the previous years

OVERALL WEIGHTED MEAN OF 3.3 STRONGLY AGREED

FINANCIAL BUSINESS PERFORMANCE

Table 4.1 represents the participants’ assessment of the Financial Business Performance.

The data shows that “Cash Flow of our business is above the industry average” received a

weighted mean of 3.5 which is interpreted as strongly agreed. The rest of the items received

agreed with the following weighted means 3.3, 2.9 3.4, 3.4 and 3.5, respectively. The overall

weighted mean for the professional competency is (3.3) with the interpretation of strongly

agreed.

36
 TABLE 5.1
REGRESSION ANALYSIS FOR NON FINANCIAL BUSINESS PERFORMANCE
VARIABLES B T P
1. Personal .161 1.47 0.144
Selling

37
 2. Printed .181 1.59 0.113
Advertisement

3. Social Media .2391 2.61 0.009

Advertisement

4. Content 1.083 9.07 0.000

Marketing
2
𝑅 = .814, F (4, 355) = 7.86, p < .001

The overall model was found to be significant 8.14, F (4, 355) = 7.86, p < .001,

2
accounting for 81.4 % ( 𝑅 = .814) variability in the SME’s business performance. The table

shows that out of variables representing Traditional and Digital Marketing, Social Media

Advertisement and Content Marketing significantly predicted business performance specifically

the business performance was improved by Social Media Advertisement ( B = 0. 2391, t = 2. 61,

P < 0.05) , followed by Content Marketing that has a result of (t = 2.61, P < .001). However, the

two variables such as Personal Selling that has a result of (B = 0.161 t = 1.47, p = .144) and

Printed Advertisement that has (B = 0. 181 t = 1.59, p < .113) does not have any significant

relationship to the business performance. Therefore, the null hypotheses “There is no significant

relationship between social media advertisement and content marketing, and non- financial

business performance.” It can be rejected. However, personal selling and printed advertisement

cannot be rejected.

TABLE 5.2
REGRESSION ANALYSIS FOR FINANCIAL BUSINESS PERFORMANCE

38
 VARIABLES B T P
1. Personal .053 0.68 0.496
Selling

2. Printed .206 2.53 0.012

Advertisement

3. Social Media .100 1.53 0.128

Advertisement

4. Content .216 2.53 0.012

Marketing

2
𝑅 = 8.14, F (4, 355) = 7.86, p < .001

The overall model was found to be insignificant [F (4, 355) = 7.86, p < .001], accounting

2
for 81.4 % ( 𝑅 = .814) variability in the SME’s business performance. The table shows that out

of variables representing Traditional and Digital Marketing, Personal Selling (t = 0.68, P < 0.05)

and Social Media Advertisement ( t = 2. 61, P < 0.05) did not significantly predict business

performance.

However, the two variables such as Printed Advertisement (t = 2.53, P > 0.05) and

Content Marketing (t = 2.53, P < 0.01) have significant relationship to the business performance

that addresses the financial performance of the business.

Therefore, the null hypotheses “There are no significant difference between personal

selling and social media advertisement and financial business performance of the business are

39
rejected”. It can be rejected. However, personal selling and social media advertisement cannot be

rejected.

CHAPTER 5

40
 SUMMARY, CONCLUSION, AND RECOMMENDATION

This chapter presents the summary of findings, conclusion and the recommendations

made by the researchers in which all the necessary information are bounded to the data and

results presented in the paper. Sequentially, the first part is the summary of the findings of each

statement of the problem that the study has; followed by the main conclusions that are gathered

from the study, and lastly the recommendations that are enlisted to further assess what benefits it

can give to the different areas of the business.

Summary of Findings

The study have a total of five (5) statement of the problem whereas the researcher

undergo with the due process to conducted a survey and develop interpretation, that leads to the

Summary of Findings.

As to the result of the survey, for the number of employees 6 – 29 employees got the

highest frequency of 58. 06 % while 30 – 99 employees got 41. 94 %.

The years of the business existence depicts how long a business is existing in the market

but as to the result of the survey the group “below 3 years” 41. 94%, the group 3 – 5 years got

41.67%. Lastly, the group of “Above 5 years” resulted to 17.50%. With the researchers

assessment, the group of “3-5 years” of business existence got the highest frequency among all

the other years of business existence.

For the nature of the business, there are four (4) different types of business to choose

from 1st is the Service Business that has a percentage of 21. 67 %, 2nd is the Merchandising

Business with 30%, 3rd is Manufacturing Business with 29. 99 %. Lastly, the Hybrid Business

that has 18.19 % in its percentage form. Therefore, there are many existing business in

Merchandising making it the highest frequency among all the other type of business.

41
 The 2nd statement of the problem has 2 factors which are the 2 sub areas of traditional

marketing namely personal selling and printed advertisements. The result of the 1st question

under personal selling “We use word of mouth in promoting our business” is 3.7 which boils

down to the verbal interpretation as “Agee”. The next question under personal selling “We

usually visit our customers to inform them about our product/business” resulted to 3.0 which is

“Agree”. 3rd question is “The business usually updates about the customers about the incoming

products/services” that has a result of 3.2 that also implicates a verbal interpretation of “Agree”.

Leading to an overall weighted mean of 3.3 meaning that the respondents agree on using

personal selling on their business.

Printed Advertisement on the other hand also has a 3 statements, first is “The business

usually uses flyers in promoting our products/business”, second is “The business use posters

in promoting products/business” and last is “The business maximizes the usage of tarpaulin

in promoting their products/services offered” the results of the three statements are strongly

agree resulting to an overall weighted mean of 3.4 which also means that respondents

strongly agree on using printed advertisement on their business.

The 3rd statement of the problem has 2 factors which are examples of digital marketing

mainly; Social Media Marketing and Content Marketing. The Social Media Marketing has

statements in which the respondents will have to answer; “Our customers usually contact us

through our Facebook page”, “The business usually post pictures and videos on

Facebook/Instagram/Twitter”, “The business keeps the social media accounts updated for new

promotions”, Lastly “The business accepts suggestions, ratings, comments through

Facebook/Instagram/Twitter”. The weighted mean results of the said statements are 3.5, 3.3, 3.4,

3.5, respectively are all bounded to the verbal interpretation of “strongly agree”. The overall

42
weighted mean of the data is 3.4 which means that the respondents strongly agree that Social

Media Marketing is helpful when it comes to advertising their businesses and engaging more

customer.

Next is the Content Marketing, that has statements such as “The company interacts with our

customers through our website”, “The business use detailed information about the

products/services.” And “The business uses digital visual content (posters) to advertise their

product / services through social media”. The results of the statements are all the same which is

3.5 and interpreted as strongly agree. And the overall weighted mean is 3.5 which means that

Content Marketing is also part of the verbal interpretation depicting the “Agree” choice.

For the 4th statement of the problem, there are only one factor which is the Financial

Business Performance. The first statement states that “Cash Flow of our business is above the

industry average” the result is 3.4 and it means strongly agreed. Next is, “Sales Turnover of our

business is above the industry average” that has a result of 3.3 and also resulted to strongly

agreed. Following is, “Return on Sales of our business is higher than the industry average”

shows a weighted mean of 2.9 and it means agree. Then next statement goes, “Return on

Investment of our business is above the industry average” that has a weighted mean of 3.4 and is

interpreted as strongly agreed. Next is, “Market Share of our business is greater than most of our

competition” that has a result of 3.5 and is also under the Strongly Agree choice. Lastly, “The

current Net profit of our business is above the previous years” that shows a 3.5 weighted mean

and it meant strongly agree. The overall weighted mean of the data is 3.5 that means that the

verbal interpretation is strongly agreed.

43
 Analysis shows that Social Media Marketing and Content Marketing significantly

predicted the business performance regarding the Non-Financial Performance of the

business, while the Personal Selling and Printed Advertisement did not have any significant

relationship or prediction of the business performance.

Conclusion

The purpose of the study is to compare traditional and digital marketing on the

performance of small and medium business in Antipolo City. The study used the Financial and

Non-Financial Business Performance to discuss the Business Performance of Small and Medium

Enterprises. With the used of Quantitative Design, the researchers gathered the data, specifically

through the results of survey that has been conducted. . From the summary, the following

conclusion were drawn:

1. Majority of the businesses are small enterprises that existed less than 6 years and operate

the business for 3-5 years under the Merchandising Business.

2. Personal Selling and Printed Advertisement must also be improved so that the SME’s can

have a better knowledge and background on how they can use an effective marketing

strategy in terms of the two mentioned types of traditional marketing. As to this, personal

selling and printed advertisement resulted to agreed and strongly agreed respectively.

3. Social Media Advertisement and Content Marketing under Digital Marketing enhances

the performance of SME’s through the wide base of marketing their product and the

business can freely engage and communicate with their existing and new target market.

4. There is a significant impact in the financial business performance if the business shows

that they are earning what they have invested in the business through the usage of right

marketing platform wherein digital marketing specifically social media advertisement

44
 and content marketing contributes a lot in gaining growth of the population that knows

the business and making each individual a target through the use of wider scope digital

marketing.

5. The significant relationship between traditional and digital marketing is that Personal

Selling & Printed Advertisement must also be relayed to SME’s owners so that they can

improve and better embrace what this 2 types of marketing strategy namely Personal

Selling & Printed Advertisement. According to Keri (2013) personal selling serves three

major roles in a firm’s overall marketing effort. First, salespeople are the critical link

between the firm and its customers. This role requires that salespeople match companies

interest with customer needs to satisfy both parties in the exchange process. Second,

salespeople are the company in a consumer’s eyes. They represent what a company is or

attempts to be an are often the only personal contact a customer has with the company.

Third, personal selling may play a dominant role in a firm’s marketing program. This

situation typically arises when a firm uses a push marketing strategy that directs the

promotional mix to channel members to gain their cooperation in ordering and stocking

product. This concept often leads to understanding both seller and consumer to have a

fair exchange of benefits using the face to face selling. Consumer can gain satisfaction

while seller can gain more sales through the patronization of products bought by the

consumers. This proves that personal selling & printed advertisement can help the

company grow and engage more with the customer. Second, Social Media Advertisement

and Content Marketing must be retained in order for the SME’s to collaborate with

traditional marketing and better improve the selling and customers engagement and

loyalty.

45
Recommendation

In view of the findings and conclusion from the study, following recommendations were

made:

1. The Local City Government should put in policies or programs on how to improve Small

and Medium Enterprises. As to the programs handled by DTI such as KAPATID

MENTOR ME Program initiated by the Department of Trade and Industry (DTI), the

program aims to assist SMEs by education entrepreneurs with the necessary skills to run

a business. It is a 12-week program that consists of 10 modules that cover product

development, marketing, operations management, accounting, taxatin, finance and

obligations and contracts. Second, Barangay Micro Business Enterprise signed into law

in 2003, the Barangay Micro Business Enterprise (BMBE) Law encourages the formation

of such through incentives and benefits. As an entrepreneur, registering will grant you

income tax exemption, exemption of coverage from the minimum wage law, social

security and healthcare benefits, priority for a special credit window, assistance programs

and training and, through it depends on the LGU, possibility of reduction in the amount

of taxes, fees and charges when setting up.

2. Researchers recommends that Personal Selling and Printed Advertisement must be taken

into growth and development so that SME’s can better provide options for the customers

who prefer face to face contact and word of mouth rather than the other variable.

3. Researchers recommend that Small and Medium Enterprises should embrace Social

Media Marketing and Content Marketing. They are the most powerful tool as per the

result of the survey because majority of the population are attracted and engage with the

46
 power and use of social media leading to higher revenues and lesser expense of

marketing strategy because the business can easily access the use of word of mouth /

page referral through social media advertisement and content marketing. Therefore,

SME’s can ensure that their business is properly handled at hand.

4. In terms of the Financial Business Performance, the different programs laid out by the

Department of Trade and Industry (DTI), the government must have more programs that

will focus on the enhancement of technological use of marketing strategy through digital

marketing to offer lesser expense but higher number of target market and possible

forecast of sales. With this, SME’s can provide more for the community without limiting

with the “needs & wants” rather the Expectation that the product can give to the

customer. The government can always intervene to improve and develop all the necessary

areas of SME’s that are lacking such as the personal business training wherein if it its

improve, SME’s can fully maximize its reason for existence to provide satisfy while

maximizing the shareholder’s wealth. Business should embrace social media

advertisement and content marketing to also improve the non-financial aspect of the

business.

5. Researchers recommend that traditional marketing and digital marketing strategies can

better improve the business performance if they are collaborated and handled properly

because traditional marketing can target customers within the reach of physical store

while SME’s can reach a wider customer base if they can handle social media and content

marketing that is aligned within their business engagement and goals.

6. Lastly, the researchers recommend that future researchers can use the said study to

expand the mixed method phenomenon wherein they can conduct further researches

47
 about the small and medium enterprises in handling the marketing strategy of their

business.

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