Sales Promotion – Impact In The Marketing Of Consumer Products In Nigeria

Sales Promotion – Impact In The Marketing Of Consumer Products In Nigeria: (A Case Study Of Unilever Nigeria Plc Aba)

Sales Promotion – Impact In The Marketing Of Consumer Products In Nigeria: (A Case Study Of Unilever Nigeria Plc Aba)

The changes in the economic existence of people and improvement in their standard of living with the increasing need of the people have led to the development of Marketing opportunity in the business world.

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Producers, in order to satisfy the consumer develop new products to meet the changing needs of the people. But, as the economy grows and expands, there is need for a better understanding of product use and an increase in the sales volume of the firm. Kotler (1980:513), noted that “important information differentiated product which are thought to have similar volume”

Scheme (1998:482), equally noted that this necessity gave rise to Marketing communications which is a means of informing, persuading and reminding customers about the nature and availability of the product. It is therefore, a communicative tool which comes in different forms such as advertising, public relations and sales promotion.

Kotler (1980:514), defined communication as a process of exchanging ideas and meanings. Communication process therefore, provides a basis for all activities of the organization that are perceived in the market.

This research will specialize on one aspect of promotional activities which is sales promotion. Different authorities and author have given different views of what a sales promotion means and only few of such concepts are described here. Kotler (1985:578) redefined it as a short-term incentive used to encourage purchase or sales of a product or service. Evans and Berman (1990:457), defined sales promotion as paid Marketing communication activities other than personal selling, advertising, public relations that stimulate consumer purchases.

Sales promotion has witnessed a rapid increase. Kotler and Armstrong (1993:423), observed that sales promotion has been increasing by 12 percent annually compared to advertising increase of only 7 – 8 percent.

It is this rapid increase therefore especially, now that the Nigerian economy is in down turn that has prompted or called the attention of the writer to research and find out “the impact of sales promotion in the Marketing of consumer product in Nigeria,” with a particular emphasis on the Unilever Nigeria Nigeria Plc maker of Omo detergents etc.

1.2 STATEMENT OF THE PROBLEM

Unilever Nigeria Plc has noted for her advertisement seems to have succeeded, but since 1997, there has been an incessant fall in Marketing of her products. In an oral interview with the oral regional manager of south east customers service Mr. Patrick? He noted that the company is influenced with regard to the decline in the Marketing of its products.

Mr. Edward Okoro the regional sales manager for south east customers service also stated that the companies influences with regard to house hold products seems to have many competitors.

Salam : retired that the unrestrictive inversion of competing broads that are cheaper and sometimes regarded to be higher quality than those of Unilever Nigeria Plc (U.N.P) market share for instance, its Omo detergent, appeared the worse hit, constantly being adulterated or faked by the new entrants, Omo in sachet, which rivals such important detergent, as Klin, is well known in the market.

These arises due to the fact that there is a proliferation of goods mostly consumer goods belonging to the same product lines. Since the early 1990s, to current. It has been observed that Unilever Nigeria Plc has been embarking on sales promotion which covers a limited area at a higher cost, so, considering the enormous task is active to determine the cost effectiveness of this expensive prone and response.

Therefore, this study seeks to find out the effects of sales promotion on profit and sales volume, and also to offer sound suggestions on how to improve upon the sales promotion incentives.

1.3 PURPOSE OF THE STUDY

In Nigeria, there are enormous increase in sales promotion activity of consumer products in recent times. The writer aims at carrying out a study of Unilever Nigeria Plc Aba, Abia state, Nigeria with a view to find out “the impact of sales promotion in the Marketing of consumer products”.

The main purpose is to find out what impacts of sales promotion activities have on the profit and sales volume of Unilever Nigeria Plc, Aba. Before promotion, during promotion and after promotion.

The purpose of this study are therefore, as follows.

1. To find out the effects of sales promotion on profit and sales volume of consumer goods with special emphasis on the demand of the companies products.

2. To find out the type of sales promotion used or engaged by the companies product.

3. To determine the acceptability of sales promotion as an important Marketing strategy by the consumer of the product.

4. To find out relationship between a firm strategy and its products acceptance.

5. To offer suggestions as to the profitability of the sales promotion as a strategy of the promotion mix elements.

1.4 SIGNIFICANCE OF THE STUDY

This study is not a mere academic exercise. It will be great benefit to the following:

Firstly, the Unilever Nigeria Plc will benefit immensely from this study. This because it will help the company to know the actual sales promotion tools to be used for each of their consumers.

Secondly, it will help the company to ascertain the effect of sales promotion on consumer purchase of their products.

Thirdly, the study will be of immense benefits to customer as adequate measures that will be recommended, which will go a long way to boost the satisfaction and value delivery ability of Unilever Nigeria Plc.

Furthermore, this research work is significant because it will provide a basis on which further research works could be undertaken in future.

Above all, the study will be of benefit to the reader as adequate knowledge and understanding will be gained from the information contained in the study.

1.5 HYPOTHESES

In the course of this study the following hypotheses will be formulated.

1. NULL HYPOTHESIS (Ho): Sales promotion does not have a positive effect on the profit of firms.

Alternative hypothesis (Hi): Sales promotions have a positive effect on the profit of firms.

2. NULL HYPOTHESIS (Ho): sales promotion does not increase the demand for a product.

Alternative Hypothesis (Hi): Sales promotion increase the demand for a product.

3. NULL HYPOTHESIS (Ho): Sales promotion is not always on the increase when there is a setback on business activities.

Alternative Hypothesis (Hi): Sales promotion is always on the increase when there is a setback on business activities.

1.6 SCOPE AND LIMITATION OF THE STUDY

This study is limited to the Unilever Nigeria Plc located with Aba Metropolis of Abia state of Nigeria and consumers of Unilever within Aba metropolis and its environments.

The scope of the study focused primarily on the impact of sales promotion on marketing of consumer product in Nigeria and the philosophies behind the company’s decision to use sales promotion incentives.

It is important to note that there were limitations imposed by constrain variables, which includes:

a. Finance: Finance was a major constraint that hampered the study. This was due to the fact that the researcher has no source of financial support, besides his parents and relatives. To this end the researcher had difficulty in coping with the financial demands of the study.

b. Time: This is another very big or major constraining variable that limited the study. This was due to the fact that the study was carried out at the peak of lectures and other academic activities consequently; the researcher had difficulties in meeting up appointments with respondents.

c. UNCOOPERATIVE ATTITUDE OF RESPONDENTS: This was another constraint to the study. Most of the respondents more importantly employees of the case organization were not easily convinced to co-operate and release valuable data that could help me carry out the study.

1.7 BRIEF HISTORY OF UNILEVER NIGERIA PLC

The name lever brothers refers to William Lever and James Lever. They are two brothers of the same parents. William lever was born at Bolton in England on the 19th of September 1856 while the date of birth of the late James lever could not be ascertained by the researcher.

Both brothers (William and James) formed the company in 1881 and move up to port sunlight in 1889. They also visited some places of interest like Solomon’s Islands, pacific Ocean, Congo and even British West Africa in Search of raw materials.

In 1920, lever Brothers, purchased they Royal Niger Company for 8m (8million pound Sterling). The aim was to facilitate the quest for raw materials. In 1929, there was the formation of Unilever by merging Margarine Union which involved Dutch Margarine makes throughout Europe.

Lever Brother came to Nigeria towards the end of 1923 and subsequence founded their company in 1924. In 1929, it opened as West Africa Soap Company.

In 1954, there was the formation of Van Dean Berghs which was declare open by Lady Kofi Abayomi this became their subsidiary company in 1957, the branch was extended to Aba now in Abia state.

1.8 DEFINITION OF TERMS

1. Sales promotion according to Evans and Berman (1990:457), are those Marketing Communication activities, other than personal selling, advertising, public relation that stimulate consumer purchases.

2. Detergent: Is defined a substance that removes dirt, or as a chemical substance used for clearing especially clothing and dishes.

(i) Soap and Soapy Detergents: These includes house Soaps, toilet soaps, bar soap and so on.

(ii) Soapless detergent: This appears in form of powder, and liquid detergent meant in this research.

3. Advertising: Is any paid form of non-personal presentation of idea, goods or services by an identified sponsor.

4. Personal selling: Oral presentation is a conversation with one or more perspective purchasers for the purpose of making sales.

5. Public relation: Is defined as a communication functions which evaluates public attitude, identities the policies and procedures of an individual or organization with the public interest, and execute a program of action to earn public understanding and acceptance.
REVIEW OF RELATED LITERATURE

INTRODUCTION

This chapter will review relevant literature on the subject matter of this study. That is impact of sales promotion on Marketing of consumers product in Nigeria. The relevance of this chapter is that, it will provide the theoretical foundation for appraising the effectiveness of sales promotion incentives designed to boost sales in –off-season.

2.2 THE CONCEPT OF SALES PROMOTION

Sales promotion is one of the components of marketing promotion mixes usually in short term incentives nature designed to stimulate sales and quick action. Stanton (1981:427), noted marketing manager just consider carefully the role sales promotion can play in the marketing mix. Kotler and Armstrong (1993:427), viewed sales promotion as consisting of short term incentives nature to encourage purchase or sales of a product or service.

Adirika (1996:142), observed that sales promotion is that something extract that can arose interest, created by buying desire, spark and immediate reaction from customers middlemen or company sales force.

Randall (1996:157), in his own view defined sales promotion as all means of promotion not specifically classified as advitising or personal selling. Ifezue (1990:144) defined it as consisting of those sellers initiated activities that supplement either advertising or personal selling and render them into a more effective persuasive force. And in the view of McCarthy (1970:274), sales promotion is regarded as those promotional activities other than personal selling and mass selling that encourage customers to buy.

According to Robert C. Blattberg and Scott A. Neslin, sales promotion consists of a diverse collection of incentive tools, mostly short term, disguished to stimulate quicker or greater purchase of a particular products or services by consumers or the trade. Whereas advertising offers a reason to buy, sales promotion works to increase sales and market share in the short run, but does not have much effect in the long run.

In addition, marketers, face a series of challenges in most forms of sales promotion, especially the high cost supporting them.

J. F. Luich and William L.Z. Leger (1965) view sales promotion as “a direct inducement which offers an extra value or incentive for the product to the sales force, distributors, or the ultimate consumer. This definition implies that sales promotional activities are always directed at categorized targets may be the consumer, the middlemen or a-company’s sales force.

It is important to emphasize that every sales promotional effort or campaign must have a clear statement of objectives, which usually result in securing an improved quantity of sales. The statement of objectives usually enhances evaluation of performance. While the marketing and General promotional or communications usually embrace the entire spectrum of marketing activities over all the relevant environment. The objectives of sales promotion appear to be restricted to a target market at any particular point in time.

2.3 OBJECTIVES OF SALES PROMOTION

The objectives of sales promotion will vary with the type of target market:

For consumers, the objectives include increasing buying response by encouraging:

a. “Shop and buy”- This is to build trial among not-users and to create in the consumer the desire to purchase.

b. “Buy Bigger”- inducing more usage and purchase of large quantity, and

c. “Repeat purchase” persuading customers to return again and again.

For retailers, objectives include increasing selling efforts and intensity by encouraging.

i. More allocation of shelf space and large stocking of the firms merchandise in the hands of the resellers-retailers and whole sellers.

ii. Special selling events and in store displays and a commitment to a firms sales promotion undertaking by resellers and

iii. Promotions by resellers to offset competitive promotions.

iv. Entry into new retail outlets.

For sale s force, objectives include increase selling efforts by encouraging:

a. Call on more accounts or prospects.

b. Stimulation of sales in off-seasons.

Over-all, the objective of sales promotion is to attract new buyers, penetrate new markets, generate new customers and provide better values and increase buying incentives for the firms present customers.

McCury, (1971:p.33), however, suggested the following reasons for undertaking sales promotional efforts:

1. Calling attention to product improvement.

2. Informing buyers of a new brand.

3. Improving market share.

4. Accelerating usage rate by present users.

5. Maintaining customer patronage and brand loyalty.

6. Obtaining dealer outlets.

7. Securing additional shelf space and added display.

8. Creating talking points for sales force.

9. Aiding in the products positioning.

10. Increasing dealer investors in lieu of competition (this is called ‘trade loading’).

2.4 SALES PROMOTION TOOLS

On the issue of sales promotion tools, Kotler (1999) observed that sales promotion tools enjoy a general usage by most organizations including producers, distributors, retailers, trade Associations such as churches and Ngo’s. He further identified three major sales promotion tools namely: Tools for consumer promotion, trade promotion tools, and lastly business and sales forces promotion tools.

According to him, the consumer promotion tools includes samples, coupons, cash refund offers, price off, premiums, prizes, patronage rewards, free trails, warranties, tie in promotions, cross promotions, point-of-purchase displays, and demonstrations.

Trade promotion on the other hand comprises price off, advertising and display and sales force promotion includes trade shows and conventions, contests for sale reps, and specialty advertising.

2.4.1 PRODUCT SAMPLING AND DEMONSTRATIONS

Sampling is generally more effective when important aspects of product features or benefits cannot be fully conveyed in advertising or personalizes selling. Sampling offers the greater method of getting the consumer to actually try the product. It demonstrates manufacturer’s confidence with his product. Sampling, however, is expensive, and includes the cost of the special packing cost is incurred where the sample are not the normal size.

Demonstrations are very important seeing the product in use, frequently purchased and “not too expensive” products such as detergents, toiletries, tobacco, confectionery etc are suitable for “give away sampling promotion.

2.4.2 COUPONING

Coupons are legal certificates offered by manufacturers and retailers that grant specified saving on selected products. When presented for redemption at the Point of purchase; manufacturers bear the cost of advertising and distributing their coupons, redeeming their face values and paying retailers a handling fee (Burnet 1998:p.362).

The consumer is given a leaflet (coupon) or voucher which enables him or her to buy a product at a cheaper price. Coupons are regular users and to attract many prospects to the product. Coupons are some times used to increase usage by present users and to ensure repeat purchase especially in the face of competition, and where the coupon is redeemable against the firm’s product. For example, “Coupon worth #30 inside post today and save #5 for every pack of cookie crunch.

2.4.3 POINT OF PURCHASE PROMOTIONS

These are incentives that are displayed at the point of purchase manufacturers provide advertising allowances and display allowances to middlemen to enable them display their merchandise attractively and encourage them to carry the manufacturer’s products. Points of purchase advertising include window display, Tell tags (labels affixed to produt that describe in detail the products characteristics and unique selling benefits), Shelf takers (labels that are attached to the shelf close to product displays), banners and signs, counter displays clocks that carry the products or manufacturers name and logo and other installations that advertises the manufacturer’s products. Point of purchase advertising may at times be considered a consumers stimulate since they induce the consumer to make unplanned purchase of the them because “they saw it displayed”. Point of sale promotion influences the impulse buyer. Outside the store, external point of sale promotion is used to attract customers into the store.

2.5.1 DEALER PROMOTIONS INCENTIVES

Trade Deals

These are buying allowances introduced to stimulate middlemen to carry merchandise or to increase sales efforts. For example, price discount or reduction for the introduction of a new product or “free goods” given to whole-sellers and retailers if they purchase a stated amount of the firms product. Retailers often complain about the form and amount of consumer deals by manufacturers.

2.5.2 TRADE SHOWS AND EXHIBITS

The motivational aspects of trade shows cannot be underestimated. Manufacturer sales person meet with top executives of various middlemen to introduce the product, demonstrate it, field questions, gather information and establish future contacts.

Many industries, professionals and manufacturers participate in National or state trade fairs or exhibitions. In Nigeria, the chamber of commerce in conjunction with the Nigerian Association of Commerce Industries, Mines and Agriculture (NACIMA) organizes three national trade exhibitions every year, in three different zones. The zones are Enugu, Kaduna and Lagos states.

Trade exhibitions are form of promotional device that enables companies to show and demonstrate their products to both middlemen and ultimate consumers.

2.6.1 SALES FORCE PROMOTION INCENTIVES

The sales force promotion activities are intended to motivate sales people to increase over all sales. These activities, general build enthusiasm for the task at hand. The aimed at raising the moral of the sales force. Sales promotion activities directed at the sales force are classified into two categories-Direct incentives and sales aids or supportive programs.

2.6.2 DIRECT INCENTIVES

Direct stimulation of the sales force is undertaken by manufacturers to spur them to higher sales performance sales offered direct incentives to enlist brand support especially in situations where these sales persons handle a large number of different brands. Sales bonuses, contests and gift incentive programs are the major direct devices for sales force promotion.

2.6.3 SALES AIDS/SUPPORTIVE MATERIALS

These are other sales force aids designed to provide salesmen with more effective support. Sales manuals, sales literature, photo albums, proto-type models, video tape presentations units, catalogue etc, such aids or sales presenters (as it is usually called) are almost certain to serve as an interactive selling medium. Burnet (1998:p.386) is of the opinion that sales manuals is the most useful to sales people because it contains both product information and element of a sales presentation. Situations appropriate for the use of such presenter can be found in both industrial and consumer selling.

2.7 PLANNING AND DESIGNING THE SALES PROMOTION PROGRAMME

As mentioned earlier, there is no best sales promotional tool. Each sales promotion tool adopted should be viewed with the communication objective it is intended to accomplish for example, price-off pack are very effective in fighting and off setting competition while sampling is an effective technique in generating initial product trial in launching a new consumer brand, heavy sales promotion campaign including discounts, coupons etc is used to achieve the objective of early awareness, adoption and heavy trial mature brands require promotions primarily designed to maintain the current market share. Sweepstakes, Trading stamps and contest are used to build patronage and stone traffic by retailers and manufacturers. When the objective is to secure the cooperation and stimulation of middlemen to carry merchandise, increase shelf space and sales efforts, the appropriate promotion devices are trade deals, advertising and display allowances. For better sales efforts and increased efficiency of salesmen, the company will normally use sales bonuses, gift incentives and selling aids. Business gifts are used more effectively in industrial markets where buyer, seller relationship seen closer and more permanently Technically oriented companies usually offer design guides, brochures or information booklet/pamphlet to users of their product. Generally it appears that technical and industrial products do not undertake major sales promotion schemes of the type seen in say, grocery trade for example, car customers tend to purchase reputation and price or value for money. Therefore, the promotional activities call for showroom displays and motivation of sales staff.

The choice of a promotion tools should be in tune with the moment. For example, coupon offers and debates are very ideal in recessionary periods. The 90’s witnessed a growth in sweepstakes, contests and game promotions. The primary goals is to set objectives and develop strategies for their attainment. There are numerous array of sales promotion devices to consider. The promoter should understand that only a few of the numerous different promotions launched annually are very successful. Many fail completely

The design and implementation of the sales promotion must be co-ordinated with the firms advertising, personal selling and public relations efforts. Sales promotion programme involves more than choosing the appropriate promotion tools. There are other basic sales promotion decisions facing the marketer.

SUMMARY OF FINDINGS, RECOMMENDATIONS AND CONCLUSION

5.1 SUMMARY OF FINDINGS

Having critically analyzed the data collected from respondents, the researcher tested the three (3) hypotheses formulated. References were made based on the result of these hypotheses. However, major findings were made based on the result of these hypotheses. These include:

1. Sales promotion contribute to consumers frequency of purchase.

2. Unilever PLC Increases its sales promotion when there is a setback on business activities.

3. Sales promotion contribute to increase in profit of Unilever PLC.

4. Unilever PLC can improve upon its sales promotion activities, through the following.

(a) Appropriate timing

(b) Appropriate incentive

(c) Proper Management

(d) Adequate channel of contribution

(e) Sales promotion is usually applied at decline stage of a product.

5.2 RECOMMENDATIONS

In view of the above findings, the following recommendations were made.

5.2.1 Unilever PLC Aba, should continue the use of sales promotion as its principal promotional tools for the promotion of its future products, However, this should be appropriately blender with advertisement, publicity, personal selling and Public Relations.

5.2.2 The sales promotion activities/operation in organizations should be manned by promotion or Marketing experts only, in order to enhance improved sales promotion.

5.2.3 Management should properly ascertain the stage of any product in its life cycle before embarking on sales promotion activity.

5.2.4 Sales promotion as a short term, tactical temporary sales booster, should be primarily used to increase the sales of a product, especially at those times when normal asles are sluggish and declining.

5.2.5 Management should adopt the use of public relations as a bridge between an organization and its various internal and external publics, and should employ it mainly to inform the various publics about important aspects of the organization’s corporate policy and to cushion the effects of a corporate crises.

5.3 CONCLUSION

This work did not attempt to go into all the ramifications of the subject matter. It is actually meant to provoke and stimulate more seasoned debate and investigation on the Research topic. However, it represents an honest contribution of the researcher to this presumably very important research topic in particular and the general body of knowledge at large.

The major conclusion drown from this research project is that all the various elements of sales promotion incentives must be studied, analyzed, planned, and implemented in a coordinated, integrated and effective manner, so as to achieve optimum sales and total Marketing success in the market place.

QUESTIONNAIRE FOR MANAGEMENT AND RELEVANT STAFF

1. Position in the Organization?

(a) Marketing manager (b) Sale Representative

(c) Purchasing manager (d) Others specify

2. What is your Educational Qualification?

(a) Ma/M. Sc/M.B.A (b) B.Sc.

(c) H.N.D (d) ON.D (e) W.A.E.C

3. What is your position?

(a) Level 1- 6 (b) Level 7- 12 (c) Level 13 and above

4. In your own opinion, Do you think that sales promotion

have effect on the profit of the firm

(a) Yes (b) No

5. It yes, to what extent?

(a) Strongly (b) Moderately Lowly

6. Do you think that sales promotion contribute to increase

in demand for your company’s product?

7. If yes. To what extent?

(a) Moderately contributed

(b)Moderately contributed

(c) Lowly contributed

8.In your own opinion, when does your organization increase its sales promotion?

(a) Low sales (b) setback on business activities

(c) To increase market sales Other specify

9. Do you think that sales promotion is on the increase when there is a set back on business activities?

(a) Yes (b) No

10. To what extent?

(a) Strongly increased (b) moderate increase

(b) Lowly increased

11. Which of the sales promotion incentives does your company used more often?

(a) Couponing (b) sampling and demonstration

(c) Price off (d) Free gift

12. Please suggest those possible ways and means to improve upon the sales promotion activities of your company

INSTRUCTION: Please tick (√) in the correct option where appropriate and comment where necessary.

QUESTIONNAIRE FOR CONSUMERS PERSONAL PROFILE

1. What is your name?

2. What is your Age Bracket?

(a) 21–31years (b) 31–41years (c) 41- 50 years

(d) 51 – years and above

3. What is your occupation?

(a) Trader (b) civil servant (c) student

(d) Others (specify)

4. What is marital status?

(a) Single (b) Married

5. In your own opinion, do you think the sales promotion influences purchase of product.

(a) Yes (b) No

6. If yes, to what extents have sales promotion influences your purchase of product?

(a) Strongly influence

(b) Moderately influenced

(c) Lowly influence

7. Do you agreed, that sales promotion help to stimulate demand for a product.

(a) Yes No

8. To what extent

(a) Strongly stimulate demand

(b) Moderately stimulate demand

(c) Lowly stimulate demand

9. In your own opinion, Do you think the increase when there is a set back on business activities?

(a) Yes (b) No

10. Do you think, that there are ways and means to improve upon the sales promotion activities of the company

(a) Yes (b) No

11. Please suggest those possible ways and means to improve upon the sales promotion activities of the compay.

12. Please, recommend on the most sales promotion incentive of a product.

QUESTIONNAIRE FOR DISTRIBUTORS PERSONAL PROFILE

1. Name

2. What is your Educational Qualification?

(a) B.Sc. (b) H.N.D (c) O.N.D

(d) (W.A.E.C/ G.C.E

3. What is your sex?

(a) Male (b) Female

4. What is your marital status?

(a) Single (b)

5. How long have you been a distributor for Unilever Nigeria PLC Aba?

(a) 1 year (b) 2 years (c) 3 years and above

6. Do you embark on sale promotion?

(a) Yes (No)

7. If yes what is the impact of sales promotion on consumer purchase

(a) Strongly stimulate demand

(b) Moderately stimulate demand

(c) Lowly stimulate demand

8. In your own opinion do you think that there are ways and means to improve upon the sales promotion activities?

(a) Yes (b) No

9. Please suggest those possible ways and means to improve upon the sales promotion activities.

Sales Promotion – Impact In The Marketing Of Consumer Products In Nigeria: (A Case Study Of Unilever Nigeria Plc Aba)

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