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Relationship between Public Relation and Export Performance: Do a Commitment and Trust a Matter?

Osama Mohamed Ahmed Enad*

Department of Business administration, Omdurman Islamic University, Khartoum, Sudan

*Corresponding Author:
Osama Mohamed Ahmed Enad
Department of Business administration
Omdurman Islamic University
Khartoum, Sudan
Tel: +249920790284
E-mail: [email protected]

Received date: May 02, 2017; Accepted date: August 02, 2017; Published date: August 04, 2017

Citation: Enad OMA (2017) Relationship between Public Relation and Export Performance: Do a Commitment and Trust a Matter?. Int J Econ Manag Sci 6: 448. doi: 10.4172/2162-6359.1000448

Copyright: © 2017 Enad OMA. This is an open-access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.

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Abstract

This research targets to test the connotation between the helpfulness of public relation and export performance in Sudanese export companies; the mediating effect of commitment and trust, the data have been collected from 150 high-ranking administrators of export company in Sudanese exporting firms. Questionnaire was used to collect the data; overall response rate was 84%. Many statistic tools have been utilized, reliability test, exploratory factor analysis, correlation analysis and hierarchical regression to the goodness of measures and interrelationships. The results showed that public relation meaningfully influenced the export performance, also commitment and trust significantly influenced the export performance, beside the significantly association between the public relation and commitment and trust.

Keywords

Public relation; Commitment; Trust; Export performance

Introduction

Exporting acts a very important part in the world and has many benefits for businesses and countries. Exporting is a significant strategy in insuring firm’s existence, and firm may accomplish competitive advantage in international markets with a positive influence on existing and future export performance and so numerous companies freshly allocate more consideration and resources in order to export their product to overseas market. Exports has great effects onto countries in term of refining financial expansion and activity, rising the domestic production growing the unemployment rate, providing foreign currencies for trade in, becoming growth accelerator, creation positive balance of trade, accumulating the foreign exchange reserves, growing productivity and social success, enhancing trade stability and industrial development, improving ability utilization and efficiency, providing employment and creates new job chances. Therefore the ulterior goal in most firms and national governments is expanding the exports. Export are the recognition of effective determinants of export performance, creation of comprehensive integrated model and fragmentary or often having contradictory information about determinants of export performance. Moreover a lot of firms are unable or unwilling to pursue export sales aggressively for the purpose that not have experience, inadequate resources or other perceived or actual obstacles W. Cravens and Nigel [1-3]. Export promotion according to Nkamnebe has been described as an central choice of the financial growth and development, vibrant exporting associate economic improvement, for sample, successful exporting has been found to be responsible for Germany’s economic miracle (The economist, 1993) company prosperity and long term profitable viability of firms have been related to export success. Successful exporting has been described as the engine of the economic development Kotler.

Literature Review and Conceptual Framework

Public relation

The process by which we create a positive image and customer preference through third-party endorsement. Kotler public relation for the company and its product consist of communication placed in the commercial media at the charge to the company receiving the publicity Cravens and Nigel [4,5]. Public relation consists of a set of tools that can be classified under the acronym of PENCILS, namely:

P: Publication (company magazines, annual reports, helpful customer, etc.).

E: Events (sponsoring athletic or art events or trade shows).

N: News (favorable stories about the company, its people, and product.

C: Community involvement activities (contribution of time and money to local community needs).

I: Identity media (stationary, business cards, corporate dress codes).

L: lobbying activities (efforts to influence favorable or dissuade unfavorable legislation and rulings.

S: Social responsibility activities (building a good reputation for corporate social responsibility) [4].

Example of Different Public Relation Press kits, speeches, seminars, annual reports, charitable donations, sponsorship, publications, community relation, identity media, company magazine, events (Table 1).

Press release To draw attention to a favorable news events (real or created for publicity purpose)
Press launches to announce new products, changes or developments, also use for annual reports
Reception To influence and ‘lobby’ targeted guests with particular messages About opportunities or problems perceived by on organization.
Personality appearance To draw general attention to a product or an organization names
Staged events Ranging from major events such as Olympic games, to minor events such as ghost weekends at historic hotels which can be used to create media interest.
Product visits Arranged for TV and radio holiday programs, and travel journalists, especially to promote additional comment.

Table 1: Type of Public Relation Activity Used in Travel and Tourism.

Setting Public Relation Objectives

The objectives for public relations are usually defined in relation to define the types of news story to be communicated, the communication objectives to be achieved (for instance, awareness creation, knowledge dissemination, generation of specific publicity for target groups) and the specific target audiences. Kotler marketing public relation can contribute to the following objectives

• Build awareness: PR can place stories in the media to bring attention to a product, activities.

• Build credibility: PR adds credibility by communication the message in an editorial context.

• Stimulate the sales force and channel intermediaries. PR can help boost sales force and franchise enthusiasm. Positive stories about a new menu item will make an impression on the customers, employees and franchisees of a restaurant chain.

• Hold down promotion cost. PR cost less than direct mail and media advertising the smaller the company’s promotion budget is, the stronger for using PR to gain share of mind. Specific objectives should be set for every PR campaign.

Choosing Public Relation Messages and Vehicles

Message theme for the public relations exercise should be aligned with the organization PR objectives. In some cases the choice of PR messages and tools will be clear cut. In others the organization has to create the news rather than find it by sponsoring noteworthy events. Creating events is especially important in publicizing fund – rising drives for non – profit organization. In the past, fund-raisers have created a large set of special events, ranging from art exhibit, auction and dinners to marathons, walkathons and swimathons [6-9].

Implementing public relation plan

The public relation campaign must be implemented with care. For example, a great story is easy to place, but, unfortunately, most stories are not earth shattering and would not get past busy editors. Thus PR professionals have to acquire a good feel for what media editors want to feature in their papers and magazines as well as establish good relationships with them. They view media editors as a market to be satisfied so that editors will continue to use their stories [10,11].

Evaluating Public Relation Results public relation results are difficult to measure because PR is used with other promotion tools and its impact of is often indirect. Ideally, the company should measure the change in product awareness, knowledge and attitude resulting from the publicity campaign. Assessing the change requires measuring before – and – after the campaign levels of these measures [12-15]. Finally, sales and profit impact, if obtainable, is the best measure of public relation effort. If advertising and sales promotion were also stepped up during the period of PR campaign, their contribution has to be considered. Finally, like the other communication tools, public relation should be blended smoothly with other promotion activities within the company’s overall integrated marketing communication efforts.

Export performance: The performance of Sudan market in the period 1970-1993 was on all counts very poor. Sudan has been losing its share of total world exports and the cotton market. Sudan is mostly an undeveloped country with over 90% of its export supplied by the agricultural segment. Agriculture is the basic financial activity accounting for more than 35% of home product the average share of total exports in for period 1970 -1993 is 7%. Dependency of the Sudanese economy on foreign trade is not as great as might be predictable. On the other hand, the foreign trade sector remains vital [16-18]. Taxes on the foreign on trade constitute more than 40% of the central government income.

The performance of Sudan export in the period 2000-2013 was rise up and down from time to time, Sudan has been losing its market share sometime and increase it in other time.

Export composition: The export of Sudan are dominated by agricultural and animals products, and these exports consist from (Sheep, Goats, Camels, Sorghum, Hibiscus flower, Cake & meal, Hides & Skins, Groundnuts, Sesame, Melon Seeds, Cotton, Gum Arabic, Fruits, Vegetables, Vegetable oil, Sugar and Gold) It’s clear from Table 1 that over the period (2000-2013) Sudan export showed a drastic change in their commodity composition. In details the total of Sudan export in the period (2000-2013) shown in following, the value in U.S. $ millions. The year 2000 the total of export was 4832563, and 2001 was reported 1.698.7, 2002 accounted 1.949.1, 2003 recorded 2.542.2, beside 2004 has accounted 3.777.8, and 2005 was 4.824.3, 2006 was 6.656.6, and 2007 the total of exports were 8.879.2, 2008 recorded 11.57.5, beside 2009 has reported 8.257.1 as well as 2010 accounted 11.404.3 moreover 2011 revealed 3.586.6 also 2012 accounted 1.729.6 and lastly the total of export in 2013 has accounted (Table 2) [19,20].

Countries 2008 2009 2010 2011 Q1
West Europe 179 69.8 175.7 33.3
United kingdom 7.8 24.4 32 2.5
France 9.6 29.7 33.5 18.6
Germany 27.1 0 11.1 5.8
Italy 13.2 4.3 2.2 0.8
Netherlands 61.7 3.4 26 0
East Europe 7.3 6.4 4.7 2.8
Russia 3.1 0 0 0
Asia 10.541.6 6.866.9 9.257.9 3.120.3
China 8.755.2 6.257.3 8.265.3 2.709.1
Japan 1.126.6 213.8 493.7 244.5
Africa 56.5 169.5 340.8 93.5
Western hemisphere 8.9 51.4 9.5 16.2
U.S.A 2 8.1 4.9 1.6
Arab Countries 700.2 578.6 1.564.3 316.9
U.Arab.Emirates 476.3 261.8 1.319.8 246.8
Other countries 156.9 487.5 51.5 3.6
Total 11.670.5 8.257.1 11.404.3 3.586.6

Table 2: Exports by Country from 2008 to 2011 (value in U.S $000S).

Setting standards performance

These standards derive largely from the objective and strategies set forth at the SBU and individual product-market entry level. They generate series of performance expectations for profitability (Return on equity, return on assets managed, gross margins, or operating margins) market share, and sales. At the product market level, standards of performance also include sales and market-share determinants such as percent effective distribution, relative shelf facings, awareness, consumers, attitude change toward a given product attribute, customer satisfaction, and the extent of price parity.

Specifying and obtaining feedback data: Once a company has established its performance standards, its next step is to develop a system that provides usable and timely feedback data on actual performance. In most cases someone must gather and considerable date to obtain the performance measures, especially at the productmarket level-analysts obtain feedback data from a variety of sources, including company accounting records and syndicated marketing information services.

Taking corrective action: The last step in the control process concerns prescribing the needed action to correct the situation. Success here depends on how well managers can presume a causal relationship and specify appropriate action (Figure 1).

economics-management-sciences-research-conceptual-framework

Figure 1: The research conceptual framework.

Conceptual framework

Hypotheses: Several hypotheses were developed in this study.

H1: There is a positive relationship public relation and Export performance.

H2: There is a positive relationship between public relation and commitment.

H3: There is a positive relationship between public relation and trust.

H4: There is a positive relationship between commitment and Export performance.

H5: There is a positive relationship between trust and Export performance.

H6: commitment mediates the relationship between public relation and Export performance.

H7: trust mediates the relationship between public relation and Export performance.

Methodology

Administrative of the field works

The FMM directory has provided information relating to company’s addresses and locations. However, information about the names of export managers, are also taken into consideration. The University cover letter attached to the first part of the questionnaire explains the objectives of the study and ensured the confidentiality of the information. A total of 150 copies of questionnaire were sent to the target respondents. In an expectation of low expected response rate, telephone calls were used to give confidence participation among the target respondents.

Sample Size to determine the sample size, the previous studies have been used the following equations

equation

Z: Standardized value indicating the level of confidence

s: Estimator of the population standard deviation

E: Acceptable magnitude of sampling error (that is, precision)

equation

3. If the sample size more than 100 questionnaires it representatives the population truly. Dependable on the above equation the sample size was 150 from the 421 firms as a population

Data analysis

General characteristics of the respondents (N=130): Concerning on the respondents characteristics who fill up questionnaires, the Table 3 shows that; respondents who work in agricultural production firms were (70.8%) as a highest ratio. Followed by animals production firms respondents (4.6%) and other firms were (0.8%), respectively as lowest ratio. The Table 3 also shows the respondents jobs, managers represented (35.4%) as a highest ratio, employees (16.9%) and lastly, the other jobs was (12.3%) as lowest ratio. Regarding the respondents ages (less than 20 years) was account (20.0%) whereas the respondents ages (less than 30 years) were (34.6) as a highest ratio, and those whom less than (40 years) have recorded (28.5%) and lastly the respondents ages above 50 year recorded (13.8%).

Total questionnaires sent to the companies 150
Returned questionnaire (not filled-up) 4
Completed questionnaires from the respondent 130
Returned questionnaires (partially answered) 2
Questionnaires not returned 14
Overall response rate 0.9066
Useable response rate 86%

Table 3: Questionnaires Rate of Return.

Also to concentrating on the respondent’s gender, most of them were males (70.8%) and the other hand female reported (27.7%). Besides, the level of education for respondents whom fill up the questionnaires, majority of them were graduate, account (68.5%) followed by secondary school (8.5%) and the postgraduate (5.4%) as lowest ratio. About the respondents experience, the table shows that; the respondents whom have worked in the firms less than 5 years have accounted (17.6%) beside the respondents whom less than 10 year were (30.0) followed by whom have worked less than 15 years have recorded (26.9) and those respondents whom were above 15 years have accounted (23.8).

Regarding to the number of employees in the firm, the table shows that firms (less than 10 employees) were account (11.5%). And the firms (less than 25 employees) have accounted (10.8) followed by firms (less than 50 employees) have accounted (10.0%) and lastly, the firms (above than 50 employees) were account (63.1%) as a highest ratio. To concentrating on the respondents involvement, active exporters were (75.4%) as a highest ratio, followed by sporadic exporters have recorded (14.6%) and lastly pre-exporters have accounted (4.6%) as lowest ratio (Tables 4-16).

Items No:Public relation Component.
PBES3 We are depending on the contests/ Olympics game for introducing the new goods in the market 0.858
PBES5 We are allocating weekly program on the radio / TV to inform about the goods 0.838
PBES4 We are inviting the press / TV to inform about the products 0.802
PBES2 We are depending on the seminars for introducing the new goods in the market 0.705
PBES6 We are determining the obvious objectives of the public relations (deleted) 0.292
PBES8 We are planning for the public relation activities (deleted) 0.513
PBES9 We are evaluating the efficiency of the public relation activities (deleted) 0.559
PBES7 We are allocating the special budget for the public relation activities (deleted) 0.585
PBES1 We are depending on the publication for introduce the new goods in the market (deleted) 0.613
Total variance explained 64.456
Kaiser-meyer-olkin (KMO) 0.737
Bartltt’s test of Spherecity 181.391

Table 4: Rotated factor for public relation.

Items No: Commitment Component
CMED1 We are obliging about the signed contracts 0.87
CMED7 We are developing the relationship in the export market 0.857
CMED3 We are obliging about the putting plans for the export 0.839
CMED2 We are obliging about the receiving in time 0.831
CMED5 We are obliging with export as a priority in our activities 0.798
CMED6 We are supporting the attitudes which are encouraging the export 0.797
CMED4 We are obliging about allocating resources for increasing the export (deleted) 0.685
Total variance explained 69.299
Kaiser-meyer-olkin (KMO) 0.86
Bartltt’s test of Spherecity 503.204

Table 5: Rotated factor for commitment.

Items No: Trust Component
TMED4 We are working faithfully for earning the trust in export market 0.971
TMED1 We are working with an integrity for earning the trust in export market 0.951
TMED2 We are working with a loyalty for earning the trust in export market 0.937
TMED3 We are working honestly for earning the trust in export market 0.933
TMED5 We are working to increase our reliability on the export market 0.902
Total variance explained 88.193
Kaiser-meyer-olkin (KMO) 0.903
Bartltt’s test of Spherecity 812.634

Table 6: Factor analysis for trust

Items No: Export performance Component
EX 2 We are improving the profitability for the exports in the export market 0.903
EX1 We are increasing the sales of export goods in the export market 0.884
EX4 Our experience is helping to achieves the strategic objectives in the export market 0.853
EX6 We are satisfying the export market with our goods 0.852
EX 5 Our knowledge is helping to achieves the strategic objectives in the export market 0.85
EX3 We are improving the market share for the exports in the export market 0.849
Total variance explained 74.878
Kaiser-meyer-olkin (KMO) 0.844
Bartltt’s test of Spherecity 693.934

Table 7: Rotated Factors for Export Performance

Variables Number of items Crombach’s alpha
Public relation 4 0.798
Commitment 7 0.899
Trust 5 0.965
Export performance 6 0.931

Table 8: Cronbachs alpha for study variables.

Variables PBR COM TRU EPR
Public relation 1.00      
commitment 0.337** 1.00    
Trust 0.291** 0.817** 1.00  
Export performance 0.328** 0.785** 0.694** 1.00

Table 9: Multiple Regressions: Public Relation and Export Performance (Beta coefficient).

Variable Export performance
Public relation 0.328**
R2 0.108
Adjusted R2 0.101
R2 0.108
F change 15.445**

Table 10a: Multiple Regressions: Public Relation and the Commitment (Beta coefficient).

Variable Commitment
Public relation 0.337**
R2 0.113
Adjusted R2 0.106
ΔR2 0.113
F change 16.357**

Table 10b: Multiple Regressions: Public Relation and the trust.

Variable Trust
Public relation 0.291**
R2 0.084
Adjusted R2 0.077
ΔR2 0.084
F change 11.801**

Table 11: Multiple regressions: Commitment and export performance (Beta coefficient).

Variable Export performance
Commitment 0.785**
R2 0.617
Adjusted R2 0.614
ΔR2 0.617
F change 205.907**

Table 12: Multiple regressions: Trust and export performance (Beta coefficient)

Variable Export performance
Trust 0.694**
R2 0.482
Adjusted R2 0.478
ΔR2 0.482
F change 118.941**

Table 13: Hierarchical regression: mediating effect of direct marketing and export performance (Beta coefficient)

Variable Model model 2 
Direct marketing 0.785** 0.825** 
R2 0.617 0.620 
Adjusted R2 0.614 0.614 
ΔR2 0.617  0.004
F change 205.907***  1.190

Table 14: Hierarchical Regression: Mediating Effect of direct marketing and Export Performance (Beta coefficient)

Variable Model 1  Model 2
Public relation 0.785** 0.761**
R2 0.617 0.621
Adjusted R2 0.614 0.615
D R2 0.617 0.005
F change 205.907*** 1.539

Table 15: Hierarchical regression: Mediating effect of public relation and export performance (Beta coefficient).

Variable Model 1  Model 2
Public relation 0.694** 0.654**
R2 0.482 0.499
Adjusted R2 0.478 0.491
ΔR2 0.482 0.017
F change 118.941*** 4.432

Table 16: Positive relationship between public relation and export performance.

Findings and Discussion

The discussion of the results of this study instigates by addressing the relationship between the public relation and export performance, then the relationship between public relation with trust and commitment. The discussion also covers the effect of trust and commitment on export performance.

There is a positive relationship between public relation and export performance

The main research purpose was to examine the relationship between public relation and export performance. The results of this study show that public relation has a positive relationship with export performance. This finding is consistent with the previous research public relation is positively related to the export performance. similar to, which reported that promotion instruments generate a positive impact on firm technological innovation, specifically on technological improvement in products, introduction of new products, and innovation in organisational management.

There is a positive relationship between public relation and commitment, trust

The second research hypotheses deal with the extent that the public relation connected to commitment, trust. The results of this study show that public relation has a positive relationship with commitment, trust. It should be noted that there is a lack of previous researches which focus on the association between public relation and commitment, trust.

There is a positive relationship between commitment/trust and export performance: The second research aims was to examine the connection between commitment and export performance. The results of this study show commitment, trust have a positive relationship with export performance. This finding is consistent with the previous research which stated that existing suppositions that employees with high income are likely to express commitment to their organization as high income is a motivator also this result similar to the organization commitment has a significant correlation with the satisfaction also agrees which reported commitment has a significant affect or effect the performance or marketing success It must be noted that most of the earlier study concentrated on narrow view of performance such as financial and non-financial indicators. These measures are essential in order to capture the export performance, but are considered mainly as short-term concerned with aims.

Commitment, trust mediate the relationship between public relation and export performance: The forth hypothesis expect that commitment/trust mediate the relationship between public relation and export performance. The results shown that, partly support for this hypotheses that may indicate is better to be moderator than mediator. In details: commitment not mediated the relationship between public relation and export performance. While trust significantly mediated the relationship between public relation and export performance.

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