Professional Documents
Culture Documents
Ans)
1. Advertising
2. Personal selling
3. Sales promotion
4. Publicity, and
5. Direct marketing.
Advertising :
Personal Selling :
Publicity :
Direct Marketing
Ans)
Advertising is one of the most visible activities of business and it does not
operate in a vacuum. By informing, persuading and reminding consumers to use
their products or services, companies risk public criticism and attack if their
advertising is offensive to the audience or if the advertised products or services
-do not perform as promised. The opinion of people about advertising is
dividedsome praise advertising while others criticise its role not only in
selling the products but also in the influence that it exerts on the economy and
society. John OToole, the late president of the American Association of
Advertising Agencies, pointed out that many people are critical of advertising
just because it isnt something else. We should appreciate the fact that
advertising is not education, journalism, or entertainment, though it often seems
to be performing the tasks of all the three. Being a tool of mass communication,
it shares some of the traits of all three but these standards should not be used in
judging advertising. Business houses, non-profit organisations and others use
advertising in the fond hope that it will help them sell products, services, ideas,
or images. There is no doubt that advertising affects all of us in numerous ways
and, due to this reason, the entire field of advertising has attracted many
controversies concerning its impact on the economy, society and ethics. Most of
these controversies relate to the following questions: How does advertising
affect the value of products? Does it cause higher or lower prices? Does
advertising promote competition or discourage it? How does advertising affect
overall consumer demand? What is the effect of advertising on consumer
choice? Does advertising make people more materialistic? Does it force people
to buy things they dont really need? Does advertising affect consumers in
subliminal ways they cant control? What is the impact of advertising on art
and culture of a society? Does advertising violate moral and ethical codes?
How much freedom should advertisers have in the kinds of products they
promote and how they advertise them? What should be the proper role of the
government concerning advertising? All these are important questions for which
there are no simple answers. The underlying principle on which all free
economies, around the world, operate is empowering people to make their own
decisions as free citizens. The study of economics tells us that there is no such
thing as perfect competition. The four basic assumptions on which free
market driven societies are based or which they strive to achieve are: 1. Self-
interest: It is assumed that individuals and organisations tend to act in ways that
can serve their own self-interest. By nature, human beings are acquisitive and
want more for less. Companies compete and advertise to attract self-interested
consumers. This leads to greater product availability, at more competitive
prices. 2. Perfect information: Buyers and sellers possess, or can have access to,
all information concerning products, their quality, prices, etc., at all times, and
this leads to greater competition and lower prices. 3. Many buyers and sellers: It
is advantageous to have a wide range of options and let the competitive forces
control the demand and supply in the market-place rather than a single, self-
interested monopoly. 4. Absence of externalities (social costs): Sometimes the
sale or consumption of products may harm those who are not involved in the
transaction, such as with pollution. The government may use regulations to
compensate for or eliminate the externalities, such as banning tobacco
advertising. Free enterprise is basically a utilitarian framework. It helps promote
behaviours that enhance the greatest good for the most people. No other
economic system has achieved this goal better than free enterprise and because
of this, more societies around the world are adopting this economic system.
Effect on the Value of Products or Services :Advertising sets off a chain
reaction of economic events. Why do consumers prefer advertised brands as
compared to unadvertised brands in the same product category? Not necessarily
because advertised brands are superior but because advertising can add value to
a brand in the consumers mind. The famous psychologist, Ernest Dichter,
known as the father of motivational research, has stressed that a products
image, created in part by advertising and promotion, is an inherent feature of the
product itself. Other studies have shown that while an ad may not speak directly
about a products quality, the image created by advertising may imply quality
and make the product more desirable by adding value to it. Advertising also
adds value by educating consumers about new uses for a product. For example,
Milkmaid was initially advertised as a tea or coffee whitener. Later
advertisements repositioned Milkmaid in consumers minds by informing them
that it could be used for preparing desserts and sweets. In a free-market system,
consumers have the option of choosing the desired value in the products or
services they buy. If price is more important to consumers, they have options of
buying less expensive alternatives. Others looking for luxury and status may
choose more fancy and expensive alternatives. Many of our wants are
emotional, social, or psychological in nature rather than purely functional.
Advertising also offers consumers the opportunity to satisfy the psychic or
symbolic needs and wants through products or services that they use.
Advertising contributes to the self-interest of both consumers and advertisers by
adding value to products and services in a free-market system. Further, it
encourages competition which adds to serve the consumers self-interest.
There are several costs involved in doing business and advertising is one of
them. What marketers spend on advertising, for majority of the product
categories, is very small as compared to the total cost of the product. In a mass-
distribution system, advertising is an important element. It helps many
manufacturers to mass-produce products and this brings down the unit cost of
products. Lower unit cost encourages marketers to bring down the product
prices and ultimately it is the consumer who benefits. Most retail advertising
prominently focuses on price and this tends to hold prices down. Manufacturer
advertising usually focuses more on product features, benefits or images in an
attempt to convince consumers that the product is better and, in these instances,
advertising tends to support higher prices.
The source of controversy over advertising stems from the way it is used by
advertisers. In accomplishing the sales or communication objectives of
marketers, advertising influences social values, lifestyles and societys tastes. It
is criticised for being untruthful or deceptive, offensive or in bad taste and
exploits vulnerable groups. Roland Berman has expressed the following views
in his book: The institutions of family, religion and education have grown
noticeably weaker over each of the past three generations. The world itself
seems to have grown more complex. In the absence of traditional authority,
advertising has become a kind of social guide. It depicts us in all the myriad
situations possible to a life of free choice. It provides ideas about style,
morality, behaviour. (Roland Berman, Advertising and Social Change, Beverly
Hills, Sage, 1981) It is generally agreed that advertising exerts a powerful social
influence and is criticised for encouraging materialism in society. Advertising is
blamed for manipulating consumers to buy things for which they have no real
need, depicting stereotypes and controlling the media.
There is no doubt that advertising and the advertised products are a part of our
culture and influence it in some way, however, advertising cannot be said to
have the power to dominate the forces of religion, family, literature, etc., that
contribute to the values of society. There seems to be little support for the view
that advertising is a pervasive force in altering consumer spending. Level of
income seems to determine the pattern of consumption which, in turn,
influences the intensity of advertising. In most societies, material possessions
are considered as an evidence of success and many argue that an emphasis on
material possessions does not mean disinterest in intellectual, spiritual, or
cultural values. Consumers, whose basic needs have been fulfilled, can be
interested in fulfilling higher-order needs. For instance, a consumer may buy an
expensive music system to really enjoy music rather than simply acquire a
material possession to impress someone. Proponents of advertising argue that
advertising merely reflects the tastes and values of society and doesnt shape
them. Advertising keeps pace with the dynamic market conditions and what is
seen as materialism is a matter of improved standards of living. Money has no
value by itself. Its value exists in the purchasing power that it puts at the
command of consumers. Who really wants to go back to medieval times and
leave the modern colourful way of life? The following points sum up the
rebuttal by the defenders of advertising: A significant amount of advertising is
essentially informational advertising. It is very difficult to separate
informational advertising from persuasive advertising. It is interesting to note
that advertising characterised as highly informational is often extremely
persuasive as well. In most developed and developing economies it is natural
for a large number of people to have higher order needs. Consumers are free to
choose the degree to which they attempt to satisfy their needs. Consumers have
the freedom of choice when faced with persuasive advertising. It is really very
difficult to force consumers to buy anything for which they do not see any
personal benefit. If advertising were really as powerful as claimed by critics,
many products with substantial advertising expenditures would not have failed
in the market-place. It is a hard reality that consumers do have a choice and
advertising cannot persuade them to buy products or services that fail to address
their needs.
4.3.2 Ethical Issues Ethics are moral principles and values that govern the
actions and decisions of an individual or group (Eric N Berkowitz et al.,
Marketing, 2nd ed. Richard D Irwin, 1992). Many laws and regulations are put
into force that determine what is permissible in advertising. However, not every
issue is controlled by rules. Marketers are often faced with decisions regarding
the appropriateness of their actions which are based on an ethical consideration
rather than what is within the law or industry guidelines. There is considerable
overlap between what many consider to be ethical issues in advertising and the
issues of manipulation, taste and the effects of advertising on values and
lifestyles. Certain actions may be within the law but still unethical. Cigarette
smoking, for example, has been shown to be associated with high levels of lung
cancer and other respiratory tract diseases and many people would consider
cigarette advertising as unethical. Advertising is a highly visible business
activity and any lapse in ethical standards can often be risky for the company.
Consumer protection groups question the sponsorship or support of sports
events by companies selling alcoholic beverages or tobacco products.
Advertisers, such as Kelvin Klein, LOreal, etc., have been criticised for using
overt sex appeals showing women as sex object in their ads. A few years ago,
Calvin Klein was even boycotted for featuring objectionable snapshots of
teenagers in various states of undress. Sex appeal and/or nudity used simply to
gain consumers attention and not even appropriate to the product or service
being advertised is in poor taste. Even when such appeal is used in case of
related products, such as condoms, people may be offended by it. Many people
consider nudity or suggestive sex in advertising as objectionable
Advertising is a very powerful and highly visible business activity. It has a
profound effect on consumer behaviour and, thereby, on society.
Companies risk public criticism if their advertising is offensive or
deceptive. Advertising is criticised for its impact on economic, social and
ethical aspects. The criticism is related to the specific approaches used in
advertising and their impact on societys values, tastes, lifestyles and
behaviour. Critics of advertising point out that advertising is often
deceptive or untruthful; sometimes it is offensive, irritating, in poor taste,
and at times it exploits vulnerable groups, such as children, uses sexually
suggestive ads and nudity, shows women as sex objects and also in
stereotyped roles. It is the belief of many people that advertising should
only be informative and not use subjective claims, puffery, and persuasive
techniques. The primary role of advertising is to make available to
consumers information that helps them make purchase and consumption
decisions. In doing so, it adversely affects competition, increases product
costs and prices to consumers. Advertisers rebut criticism by saying that
advertising only reflects contemporary values and lifestyles. Critics say the
presence of advertising in all imaginable media plays a major role in
influencing and communicating social values. Critics blame advertising for
encouraging materialism and persuading consumers to buy products and
services they dont really need. Advertising Standards Council of India has
prescribed certain norms for advertisers and also encourages consumers to
forward their complaints to ASCI to recommend appropriate action.
Market analysis
Sufficient Funds: The first condition relates to the nature of market and the
remaining three conditions relate to the product or service and the consumers'
perceptions about such offers. Even if all the above mentioned four aspects are
favourable, much depends on the availability of sufficient funds required for
advertising. People in the advertising business believe that "the greatest waste in
advertising is to advertise too little." If the firm lacks enough funds to commit to
advertising at some minimal level to create noticeable impact, it does not make
sense to advertise. It is hard to imagine that in a highly competitive market
environment one or two ads would even be noticed with so much of advertising
clutter. What Apple computer could achieve with just one ad by paying half a
million dollars for a 60 second commercial is not likely to happen with most
advertising. Successful advertising needs the support of adequate funds. The
prospective advertiser should make a deliberate and careful assessment of the
above mentioned conditions. It is likely that advertising may not be a suitable
option for the company for any of the reasons discussed. The advantage might
lie in allocating a larger portion of the promotion money for sales promotion,
for example, a sample drop in selected market areas. The role of advertising
may appear to be only marginal in a company's marketing programme.
6.2.6 Create Adds, Pre-test, and Release Adds Advertising companies cannot
afford to neglect pre-testing of the ad campaign. Rising costs of media,
thousands of advertising messages competing to get noticed and audience
apathy and often dislike of adds make it essential for companies to be
reasonably sure that the campaign message is attended to and comprehended.
Most authorities agree that advertising should be pre-tested before actual
execution to avoid any costly mistakes and increase its efficiency. For pre-
testing advertising strategy and execution, various techniques such as market
tests, focus groups, surveys, and computer simulation tests etc., are used before
the ads are placed in media.
TELEVISION
8.2.1 Advantages
Creativity and Impact The greatest advantage of TV is its ability to present the
advertising message in the most unique way. The integration of sight, sound,
motion and colour offers extraordinary flexibility to make dramatic and lifelike
portrayals of products and services. The commercials can effectively
communicate an image, or mood, associated with the brand. The commercial
can also help build an emotional association, or create entertaining messages
that might make an otherwise unexciting and common product seem to be
interesting. Television is quite adept at communicating humorous, serious,
realistic, or tongue-in-cheek commercials. If the nature of the product is such
that a demonstration would convey the ad message more effectively, TV is the
most suitable ad medium. The print ads of products such as autos, TVs, and
microwave ovens, etc., can show the product and provide information about
their features and benefits but a TV commercial can put the audience in a
position where he/she can actually sense driving or operating the gadget. This
can definitely make an impact not possible by any other advertising media.
People generally rate television as the most credible source of information.
Advertisers gain a qualitative edge because television enjoys the most positive
image of all media. Coverage and Cost Effectiveness Advertising on television
makes it possible to reach a large number of audiences. Doordarshan claims to
have its terrestrial reach to 70 million households in India, including rural areas.
It is estimated that over 191million television audiences are urban and 171
million viewers are located in rural areas. In villages, with a population between
1000 and 5000, average time spent in viewing TV ranges between 24.6 to 32.0
minutes per working day. The same in metros and cities ranges between 32.1 to
36.8 minutes per working day. Cable and satellite channels (C & S) reach 20
million homes, mostly urban. BBC Worldwide reaches a claimed 261 million
homes around the world. Television is a home and family entertainment
medium. Regardless of location, income, age, sex, or educational level, most
people watch at least some TV. A significant number of audiences watch TV
programmes on a regular basis. Television is credited as being the single biggest
factor in opening up the huge rural market to a variety of consumer products.
The simple rural people of India realised that there is a world outside, very
different in many ways. Television has been instrumental in raising the level of
aspirations of the Indian middle class.
Advertisers who are selling products and services that appeal to broad target
audiences find that by using television they can reach mass markets in a cost-
effective manner. This is a major reason that television has become a
particularly popular medium among advertisers of mass consumption products.
Companies having intensive distribution arrangements for their products such as
HLL, Procter & Gamble, Coca-Cola, Pepsi Co, Nirma, OTC (Over the Counter)
remedies, etc., use TV advertising to reach large audiences at a relatively very
low cost per thousand
Radio
Newspaper
Magazines
Outdoor media
Ans)
Sales promotion is the only method, among all the available promotional
methods, that can make use of a combination of pull-push strategy to
motivate consumers, trades people and the sales force simultaneously in
transacting sales. The two major target groups towards whom the sales
promotions are directed are consumers and traders. Temporary incentives, to
motivate the sales force, are also considered as sales promotions directed at the
sales force and are often referred to as sales force sales promotion. These
incentives are part of the motivational programmes to build enthusiasm in sales
force for the task at hand. Often sales force sales promotions are aimed as much
at raising the morale of the sales force as at creating a sale.
The company can use sales promotion to achieve many objectives, however,
every offer must start by being specific as to which objectives are to be
achieved. According to Schultz and Robinson (Sales Promotion Management,
Chicago: Crain Books, p 149, 1982), the objectives should be:
1. Specific
2. Measurable
5. Affordable and
6. Attainable
Some of the important objectives are mentioned below, and the more important
ones have been discussed briefly:
Launch New Products and Increase Trial Small budget companies, who
cannot afford sustained advertising expenditures to introduce new products, or
match the competitive advertising blitz, find sales promotions to be more cost-
effective and helpful in generating sales volume. Companies, who have a small
market share, cannot match the substantial advertising budgets of market
leaders in the same industry. It is also difficult for them to get proper shelf-
space in retail shops without offering incentives to re-sellers, or encourage trial
by consumers without offering some immediate or extra benefit. A free sample,
along with a coupon of attractive value, may prove to be more effective in
inducing trial of a new product by consumers and may also lead to purchase of
the regular pack from the market. A free sample is generally welcome to almost
all consumers and increases the probability of trial and, in some cases, purchase
as well. A number of personal care products, such as shampoos, cosmetics,
toilet soaps or laundry products, such as detergent powders and cakes, etc., have
been introduced successfully in the last few years. Colgate Palmolive launched
Palmolive toilet soap in 1989. Its sales in Chennai, which is one of the largest
markets for toilet soaps, were below all India levels. Market research studies
revealed that the cause of below-level acceptance was inherent conservatism of
the consumers in this market. They do not change brands easily and, despite
heavy advertising, consumer awareness and trial were low. The trial-retention-
ratio suggested that once consumers tried Palmolive soap, they liked the
quality and stayed with the brand. During a four-month period (February-May
1990), promoters called on about half a million households in this city. To
encourage consumers to buy from promoters, a stainless steel teaspoon was
given free with only one cake of Palmolive soap, and subsequent cakes were
sold on a marginal discount. The focus was on an incentive which would ensure
trial of even one cake. For this period dealer shelves were hired to place
attractive displays to make Palmolive soap a highly visible brand in the
windows of retail stores. Sales increased substantially in March and informed
people say, it almost doubled by the end of April 1990. Product adoption
increased just by stimulating trial rate by consumers and lead to growth in sales,
which was maintained subsequently. Consumers often use samples that are
distributed free, with or without a coupon, to introduce a new product or induce
trial of even an existing product. Small budget firms have to exercise extreme
caution and use such promotion judiciously because this may prove to be quite
an expensive proposition. It would be more appropriate to choose selected
markets with high potential.
12.3.6 Deflect Customers Attention from Price Price increase can often have a
negative effect on sales. Marketers can develop appropriate sales promotion to
accomplish the objective of reducing the negative impact on sales. If the price
of the product was Rs 50 before the price rise, and the new price is Rs 60, then a
coupon with a face value of Rs 5 is provided that places the products price
between Rs 50 and Rs 60, making the effective price only Rs 55. When the
coupon would not be available, the new price does not appear to be so high
relative to the new price of the product. Consumers develop a new reference
price for the product and the increase does not appear to be as high as it was
perceived earlier. Of course the coupon should be of immediate value, instantly
redeemable on-package, or the discount should be given at the time of
purchase.
: Some common Pull and Push strategies used in advertising and sales
promotion
Offers what the consumers want: Sales promotion must not attempt to push
any offer that is not regarded as desirable by target consumers. They cannot
attract consumers towards offers that are not perceived as interesting, exciting
and valuable to them.
Promotion should be highly visible: The offer must draw attention of target
consumers. The media selection is important. Effective promotion draws
attention from high visibility and from creative qualities.
Promotion must be legal: The marketers must check the legality of promotion
before announcing it.
There are different groups who might be the target of sales promotion:
consumers, trade and the sales force. Sales promotions originating from
manufacturers may be directed at consumers, resellers, or both. Simultaneously,
the manufacturer may also have a promotion programme for its own sales force.
Sales promotions may also originate from retailers and aimed at consumers,
though their objectives are different from those of the manufacturers. Their
purpose generally is to increase store traffic rather than sell a particular brand,
as may be the case with a manufacturer-initiated promotion. Sales promotions
directed at the end-user, whether by the manufacturer or the retailer, are called
consumer sales promotions. Manufacturer announced promotions to consumers
are based on pull-strategy of the manufacturer. However, retailer announced
promotions to consumers constitute the push-strategy of the retailer. The
objective of most consumer sales promotions is to stimulate consumers to buy a
brand. In certain situations, the objectives for both new and established brands
can also be to encourage consumers to try a product, load the consumers and
increase consumption of an established brand, retain the consumers, build brand
equity, targeting a specific market segment, or enhancing advertising and
marketing efforts, etc. In general, consumer promotions can be same for less
or more for the same which may get translated into a straight price-cut or
added value. Another approach to consumer promotion can be to offer an
interest promotion, which may or may not require purchase of anything, such
as contests and sweepstakes, mail-in premiums, free-premiums and free
samples, etc. Such interest promotions are intended to stimulate consumer
interest, other than price, in products, services, activities, or special events.
Some consumer promotions are considered as consumer-franchise building. In
such promotions, the communication portion included with the premium, free
sample, or the coupon, contains some selling message that reinforces the
consumers understanding about the brand, or the premium offered is related to
the promoted product. Consumer sales promotions cannot make consumers
loyal to a brand that is of little value or does not provide them with a specific
benefit. However, promotions can make consumers aware of a brand and by
communicating its specific features and benefits, contribute to the formation of
a positive and favourable brand image. Franchise building consumer promotions
are designed to create long-term brand preference and ultimately lead to the
goal of full-price purchases. Originally, advertising was viewed as the exclusive
means of image building and sales promotion was used for short-term
immediate sales. Marketers are now recognising the franchise building potential
of sales promotion. According to Betsy Spethmann (Money and Power,
Brandweek, March 15, 1993), a survey of senior marketing executives found
that 88 per cent believe that consumer sales promotions can help build a brands
equity and 58 per cent think that trade sales promotions can contribute.
Ans)
To assess what the marketers position in relation to competing sources is? For
example, the members of the audience may heavily rely on information from
friends or from published reports, or may also be open to some new sources of
information.
Ans)
Retail (Local) Advertising The manufacturer has little concern where his
product is purchased. To that extent, the goal of the retail advertiser differs from
that of the national advertiser who is the manufacturer. The retailer advertises to
encourage patronage by consumers and build store loyalty among them. He is
not particularly concerned with any specific brand. In case the retailer shows
some concern (say he wants to clear stocks of a particular brand), then the
message in effect is buy brand B at our store. The general idea behind retail
advertising is buy at our store. The sale of any specific brand is not the
concern of the retailer unlike the national advertiser.
The retailer must compete in one of the most competitive arenas of business and
move large volumes of products. Besides, the advertising must convey the
image of the store to particularly attract certain types of consumers. To achieve
these objectives, retailers often communicate price information, service and
return policies and the range of merchandise available through these ads. Some
retailer ads are specifically aimed at building store traffic. Generally, the retailer
works in a narrowly limited geographic market. This allows him to focus his
advertising messages to the likes, preferences and buying habits of the targeted
audience. The retailer advertises to precipitate a relatively quicker response to
most of this local advertising, while the national advertisers prime interest is in
establishing longrun favourable attitudes and building brand equity. Besides the
broad classification of display advertising into national and local, some other
forms of display advertising are discussed below. Cooperative Advertising:
Manufacturers of consumer durable goods or specialty products often show
special interest in their dealers advertising. To help identify the dealers in
different geographic markets, dealers put out ads in the local media under their
names. The manufacturer often provides the dealer with the material and
guidelines to develop ads for print, television, or radio commercials. This
ensures that the message is in line with what the manufacturer wants to
communicate. The manufacturer and the dealer usually share the media costs
and hence the name cooperative advertising. End-product Advertising: There
are many products that are rarely purchased direct by consumers. They are
usually bought as a part or ingredient in other products. For example, branded
products such as Teflon (DuPont), Pentium (Intel), Athelon (Advanced Micro
Devices), and many others are used in the manufacture of other end-products.
Advertising of such products is called end-product advertising (also called
branded-ingredient advertising). Manufacturers whose branded parts or
ingredients are used in producing usually other branded or unbranded consumer
products often undertake this type of advertising. Successful end-product
advertising helps create demand for the ingredient that helps in the sale of
another product. For example, Intel promotes its Pentium processors. The
sustained existence of consumer demand for such ingredients encourages
companies to use them in their consumer products. It is not easy to build end-
product demand. The manufacturer must have an ingredient that is widely
recognised by manufacturers and consumers and is believed as having
advantages that will improve the usefulness of the finished product. Extensive
advertising is required to communicate the advantages of such products to
consumers because the ingredients are often not obvious in the product. End-
product advertising may take national or international dimensions and can be
very advantageous to companies who can successfully do it. For example, in the
present scenario of computer market, different segments of consumers are
interested in knowing whether the computer has Intels Pentium processor
(Celeron, Pentium4) or Advanced Micro Devices (AMD), or something else. It
is no secret that Pentium is not only well-known among consumers but also has
the maximum market share in the world.
Classified ads: are a substantial source of revenue for newspapers. The ads are
arranged under subheads that describe the class of goods or the needs that the
ads seek to satisfy. Such ads provide a community market-place for goods,
services and opportunities of every typereal estate, autos, matrimonial,
domestic help, coaching, employment, business opportunities, etc. Most
classified ads are just text set in small type. Some newspapers also accept
classified display ads. These ads run in the classified section of the newspaper
but use illustrations, larger type sizes, white space, borders, colour and photos.
For example, Ascent section of Times of India is devoted to employment ads
and in some ads colour and photos are used.
3. Some critics say that advertising creates materialism in society. What is your
opinion of this view? Discuss.
Ans)
Media planning has become fairly complex and risky with the increase in cost
of various media and the proliferation of media choices. The planners have to
critically analyse the choice of media class, subclass and media vehicles.
Besides new and emerging media, the process of making a choice among
alternatives within the same medium becomes complicated because of a wide
range of alternatives. Media planning refers to a series of decisions concerning
media objectives and media strategies to accomplish the advertising objectives.
Media class refers to the general category of delivery system to carry ad
messages to the target audience, such as print media. Newspaper represents a
subclass in print media. Media vehicle is the specific message carrier within a
medium, for example, Times of India is a media vehicle in print media subclass.
Within the last decade, the media planning function has acquired a lot of
significance in developing advertising campaigns. The proliferation of media
choices and their increased costs have made the task of media planners more
difficult and risky. Mass media options include television, radio, newspapers,
magazines, out-of-home media and others. The choice may seem to be
straightforward, but it is not. The selection of media has become quite intricate
because of the nature of media themselves. The characteristics of each
alternative must be considered carefully. For example, TV can show action,
combining both sight and sound, and can produce an impact that simply is not
possible through other media. Newspapers can carry ads containing much
detailed information as compared to TV or radio. Magazines can convey
detailed information, which remains available to a potential buyer for a longer
time. The process of choosing between alternatives becomes even more
complicated considering the wide range of alternatives within the same
medium. For example, Femina, Vogue, Readers Digest, Filmfare, Stardust,
etc., are well-known fortnightly or monthly magazines. New and evolving
media have further contributed to the difficulty of planning when, where, and
how the ad message will be delivered.
Media planners face the essential task of ensuring optimal use of media budget
while deciding about the reach, frequency, and the number of advertising cycles
affordable for the year. We have seen in the hierarchy models that the first stage
requires awareness of the product or brand. Obviously, if more people are
aware, there is more likelihood that more of them will move to each subsequent
stage and finally to purchase action. Creating awareness among audience
requires reach which is exposing potential customers to the advertising
message. In case of a new product or brand, quite a high level of reach is needed
to make almost all the potential customers aware of the new introduction.
So far, there is no known way of determining how much reach is required to
achieve desired levels of awareness, attitude change, or purchase intentions.
Also, there is no certainty that an ad placed in a particular media vehicle will
actually reach the target audience. For example, if an advertiser buys 30 or 60
seconds of TV time during a certain programme, everyone who is tuned to this
programme will not necessarily see the commercial for a number of reasons. In
advertising terminology, frequency refers to the average number of times
audience individuals or households are exposed to a medium in an advertising
cycle, not necessarily to the advertisement itself. Most advertisers agree that 1:1
advertising ratio does not exist. An ad may be placed in a media vehicle and the
fact that an individual has been exposed to it does not mean that the ad has been
seen. For this reason, media buyers refer to the reach of media vehicle as
opportunity to see (OTS) an ad rather than actual exposure to it. Since there is
no certainty that an exposure to a vehicle actually results in an exposure to the
ad, it is accepted that one exposure to the media vehicle constitutes reach,
provided that this exposure must occur for the audience member to offer an
opportunity to see the ad. This approach, though, does not help in determining
what frequency level is needed to create the desired impact. Decisions in this
regard are not always based on any hard data. According to Joseph W Ostrow of
Young and Rubicam agency, Establishing frequency goals for an advertising
campaign is a mix of art and science but with a definite bias towards art.
Frequency =
Total Exposures Reach An example will illustrate the concepts of reach and
frequency:
S (Reach) = 8
Frequency =
The best trade-offs depend on the media strategy for the target audience and the
nature of the product/brand. It is possible that audience members are exposed to
more than one media vehicle carrying the same ad, resulting in repetition. If the
ad of a face cream is placed in two magazines, Savvy and Femina, a number of
target audience members will be exposed to both vehicles, resulting in
duplicated reach. If the ad is placed in one magazine only, the total number of
audience exposed only once is unduplicated reach. Figures of both duplicated
and unduplicated reach are important. Unduplicated reach represents potential
new exposures and duplicated reach provides an estimate of frequency.
6 Discuss the advantages and disadvantages of TV advertising. How is TV time
bought?
8. What is inventory risk? How can promotion planners reduce this risk for re-
sellers?
Ans)
Re-sellers are concerned about the inventory risk associated with stocking or
not stocking the product on promotion. If they are out-of-stocks, then there is an
opportunity cost, and if residual stocks are left that cannot be sold on list price
to consumers, then the traders are concerned with lost margins. Inventory risk is
higher for many reasons such as: When consumer demand for the product is
unpredictable When inventory holding costs are high When additional stocks
of the product cannot be obtained quickly for any reason When prices are
unstable When the product is seasonal When the product is likely to go out of
fashion quickly, and When the producer does not agree to accept unsold stocks.
Manufacturers of high inventory risk items generally promote the more popular
items during the peak period of consumer demand.
Inventory risk is less severe or milder if the manufacturer has more control on
the distribution channel, as in the case of exclusive distribution, or the delivery
is direct to the store. This gives the marketer access to more control and the
inventory can be managed more accurately to minimise risks with over or under
stocks. Some brands enjoy high awareness and loyalty. These brands may have
a dominant share in the product category and their sales may be growing. These
factors are important to the trade because they contribute to high sales turnover,
profits and the image of the store, more so if the intensity of competition is low.
Traders view such brands as good traffic builders and they do not hesitate in
allocating advantageous shelf placing to such brands. In promoting such strong
brands, it is preferable to offer price discount to traders as they are more likely
to pass through part of the benefit to consumers. If price cuts are offered in the
form of coupons to consumers, it is advantageous to mail coupons to nonusers
rather than existing users. Brands, which are weak, do not have many options.
Promotions requiring trade push are generally not available for such brands. A
higher percentage of promotion budget goes to price-deals for consumers to
reward them immediately at the time of purchase to create any impact. It is a
good idea to go for tie-in promotion with a strong brand that can attract greater
consumer and trade attention. Sales force is also unlikely to pay much attention
to weak brands unless they are offered some incentive (sales force promotion).
Higher inventory risk would require that promotions be developed for separate
markets. Excess product stocks from one market can be shifted to another
market where the sales potential is more.