Moderating Effect of Internet on Advertising and Performance of Small Business Enterprises in Nigeria

Abstract

The extant literature showed that the relationship between advertising and the performance of small and medium enterprises (SMEs) is widely researched. However, there is a paucity of literature on the effect of different facets of advertising, as well as moderators on the performance of SMEs. Also, there is a paucity of research of this nature in the context of emerging economies like Nigeria. Therefore, the current research intends to fill this gap and investigate the relationship between four (4) different facets of advertising (traditional advertising, advertising cost, advertising quality, and internet adverting) and the performance of small business enterprises in Katsina, Nigeria. In establishing a relationship among variables, the study adopts a quantitative approach and cross-sectional survey design. Accordingly, the data of 208 respondents was obtained using a questionnaire and analyzed using the Partial Least Square Structural Equation Model (PLS-SEM). Based on the result, the study found that both traditional advertising, advertising cost, advertising quality, and internet adverting have a positive significant effect on the performance of small business enterprises. As well, the study has confirmed the moderating effect of internet advertising on the relationship between traditional advertising and performance. However, the same effect was not found in the relationship between advertising cost, advertising quality, and performance. Hence, it is recommended that SMEs that seek to achieve an optimum level of performance, must embrace both traditional and internet modes of advertising, and as well, amortize advertising cost (expenditure) and add quality to advertising programs.