Advertising effectiveness

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  • 1. http://www.allprojectreports.com/index.htm Project Report on Advertising Effectiveness [Advertising/Sales Promotion/Sales Management] ADVERTISING EFFECTIVENESS CONCEPTUAL STUDY OF PROMOTION MIXPeople no longer buy shoes to keep there feet warm and dry. They buy thembecause of the way the shoes make them feel masculine, feminine, rugged,different, sophisticated, young, glamorous, "in" buying shoes has become anemotional experience . Our business now is selling excitement rather thanshoes. - Francis C. RooneyModern Marketing Trends : Modern marketing calls for more thandeveloping a good product it attractively and making it accessible to targetcustomers. Companies must also communicate with their present and potentialcustomers. Every company is inevitably cast into the role of communicator andpromoter.What is communicated, however should not be left to change. To communicateeffectively; companies hire advertising agencies to develop effective ads; salespromotion specialists to design sales incentive programmes and public relationsfirms to develop the corporate image. They train their sales people to befriendly and knowledgeable. For most companies, the question is not whetherto communicate but rather what to say, to whom.Promotion Technique :Promotion influences demand by communicatingproduct and company message to the market. A promotion Techniques involvesthe co-ordination of all communication efforts aimed at a specific audience;consumer and shareholder. The most critical promotional question is the propermix of advertising, personal selling, sales promotion and publicity. Thepromotion mix is usually co-ordinated on a campaign basis, taking thecampaign may efforts include a total campaign with one unified theme. Allpromotion messages tie in to this theme in one way or the the, rather thanconflicting with it. ADVERTISING
  • 2. What is Advertising :The word ‘Advertising’ has its origin from a Latinword ‘Adventure’ which means to turn to. The dictionary meaning of theword is ‘to announce publicity or to give public concerned to a specific thingwhich has been announced by the advertiser publicity in order to inform andinfluence them with the ideas which the advertisement carries. In businessworld the terms in mainly used with reference to selling the product of theconcern.The advertising, as Jones defines it is "a sort of machine made mass productionmethod of selling which supplements the voice and personality of theindividual salesman, such as manufacturing the machine supplements the handsof the craftsman." It is thus a process of buying/sponsor/identified media spaceor time in order to promote a product or an idea. From a careful scrutiny of theabove definition, the following points emerge :Advertising is a paid form and hence commercial in nature. This any sponsoredcommunication designed to influence buyer behaviour advertising.Advertising is non-personal. Unlike personal selling, advertising is done in anon-personal manner through intermediaries or media whatever the form ofadvertisement (Spoken, written or visual). It is directed at a mass audience andnot directed at the individual as in personal selling.Advertising promotes idea, goods and services. Although most advertising isdesigned to help sell goods, it is being used increasingly to further publicinterest goals.Advertising is identifiable with its sponsoring authority and advertiser. Itdiscloses or identifies the source of opinions and ideas.Advertising thus is :1. Impersonal2. A communication of ideas.3. Aimed at mass audience4. By a paying sponsor.The two forms of mass communication that are something confused withadvertising are publicity and propaganda. If we eliminate the elements of the
  • 3. "paying sponsor" (The paid requirement) we would have the element ofpublicity left : For publicity is technically speaking, advertisement withoutpayment. In a similar manner. If we eliminate the requirement of an "identifiedsponsor", the resulting communication is propagandistic.It is important for us to emphasize that advertising may involve thecommunication of ideas or goods of service. We are all aware that advertisingattempts to sell goods and services. But we may overlook the more importantfact that it often sells ideas. Advertising may persuade with information; it maypersuade with emotion: more frequently, it endeavours to persuade with somemixture of both. (1) Electronic MediaAdvertisers use two types of media to reach target consumers over theairwaves; radio or T.V.(A) Radio :Advertisers using the medium of radio may also be classified as National orLocal advertisers. The radio is a prominent vehicle of advertising in ourcountry and accounts for a large sum of the total advertising budget.The radio serves principally local rather than national or large regional markets.Many small advertisers use the radio. So do some large organizations.When T.V. became a factor in the advertising scene, some industry observersfelt that radio advertising might become insignificant or even disappear. Thishas not been so, for radio operators have responded to the challenge by offeringprogrammes that features music etc. which appeal to local audience consumershave responded very favourably to this approach. Moreover TV does not havemuch coverage in our country.(B) Television :T.V. - Advertising Media :Late in India, a growing class of advertising mediahas been the TV. In our country, commercial advertising on TV is severelylimited because broadcast timings are only in the evenings. The TV is a uniquecombination timing of sight and sound and achieves a deeper impact than theother media do. This is particularly advantageous for advertisers whose productrequire demonstration. TV advertising offers advantage of impact, masscoverage, repetition, flexibility and prestigious. In our country not everyone has
  • 4. a TV set; therefore it does not reach everyone. Moreover, in rural India where76.31% of our population lives. There are hardly any TV sets, except at thecommunity centres where electricity is available. Moreover, TV programmes inour country do not offer much selectivity. The translation is limited, any centersdo not have TV towers.TV appeals to both the senses of sound and of sight . As a result is combinesthe two to produce high-impact commercials. Finally, the fact that product orservice is promoted on TV may build a prestigious image of the product and itssponsor. The pleasure derived from watching TV is at least potentiallytransferable to the advertising message delivered through the medium. (ii) Print MediaThe print media carry their massages entirely through the visual mode. Thesemedia consist of newspapers, magazines and direct mail.(A) Newspaper :A sizable share of the total advertising budget is spent on advertising innewspapers. Newspapers in our country virtually reach most of the homes inthe cities. Since newspapers are local, marketers can easily use them to reachparticular markets. This selectivity is easily rigorous. Some are in the twelve-hour range. From the viewpoint of the advertiser, newspaper offers severaladvantage, they are local in content and appeal and provide opportunity fordirect communication between a product and its local dealers or distributors.Because newspapers supply news, they offer an atmosphere of factualinformation and of currency that may be favourable for some advertisingsituations. Advertisers can reach a very broad audience through newspaperswhich offer great flexibility. The advertisers may choose the specific area to becovered and the advertisement can be placed in newspapers at very short noticeas compared with other media.(B) Magazines :Magazines are also mean of reaching different market, both original andmatinal and of general and specific interest. An organisation may approachnational markets through such publication as Business India, Famina,Sportsweek, India Today, Business World and Filmfare. Some marketers dividetheir market on the basis of such variable as age, educational level and interestmagazines. Magazines are divided into those parts that serve business,industrial consumers, ladies, sports etc. The diversity of magazines is
  • 5. tremendous. Some offer news or together "General Interest" content to hugeaudience. Others are highly specialised, technical or even exotic. In general,magazines offer advertiser the opportunity to reach highly selective audience.The primary advantage of magazine advertising are selectivity of markettargets; quantity reproduction long life; the prestige associated with somemagazines; and the extra service offered by many publications. The quality ofmagazines reproduction is usually high. Consumers sometime keep individualcopies for long period of time; reread them or pass them on to other. Somemagazines have prestige value. The marketer can cover national or largeregional markets at a low cost per contract (per individual reached). Magazinesgenerally offer high-quality printing of advertisement. (iii) OUTDOOR AND TRANSIT MEDIA(A) Outdoor Advertising :Outdoor Advertising :Outdoor advertising involves the use of sign and bill-boards, posters or displays (such as those that appear on a building’s wall) andelectric spectacular (large, illuminated, sometime animated sign and display).The marketers may purchase billboards on the basis of showings. A showingindicates the percentage of the total population of a particular geographic areathat will be exposed to it during one month period. The highest showing is 100.Here the number of billboards is would attract approximately 50% of the localpopulation about 20 times during a month. Sings are usually smaller thanbillboards and are erected and maintained by the marketer rather than by theadvertising media.This form of advertising has the advantage of communication quick and simplyideas of repetition and of the ability to promote products that are available forsales. Outdoor advertising is particularly effective in metropolitan and othercan use this medium to bring the products to the attention of consumers or toremaining them of the product, while they are on shopping trips or areadisposed towards shopping. Advertisers may utilize this medium toeconomically reach a large mass of people or small local markets.(B) Transport Advertising :Transport advertising appears on the inside or outside of taxis, buses, railwaysand other modes of passenger transportation. Marketers may use transitadvertisement to attain high exposure to particular groups consumers on theoryway to and from work and tourists. Repeat exposure is possible for a majority
  • 6. of the people in our country use public transport basis. Transport advertising isuseful in reaching consumers at an advantageous point which they areembarking on a shopping trip. This medium is a low cost medium. SALES PROMOTIONAccording to the American Marketing Association, Sales Promotion consists ofthose marketing activities other than personal advertising and publicity thatstimulate consumer purchasing and dealer effectiveness, such as displaysshows and expositions, demonstration and various non-recurrent selling effortsnot in the ordinary routine.Sales promotion activities are impersonal and usually non-recurring and aredirected at the ultimate consumers, industrial consumers and middlemen. Theseactivities tend to supplement the advertising and personal selling efforts.Examples of sales promotion are free product samples, trading stamps, storedisplays, premiums, coupons and trade shows. For many organisations,including the marketers of food, toys and clothing, store displays are animportant sales promotion device. Display exposes the promotion messages toconsumers at the time and place of purchase. Such exposure is especiallyimportant for items that are bought on impulse. Numerous consumers productsare purchased in stores that use self-service selling methods. Marketers of suchitems need effective display in order to distinguish their products from those oftheir rivals. PUBLICITYPublicity is a means of promoting the mass market and is similar to advertising,except that it is free, is found in the editorial portion of news media andpertains to newsworthy events. The most common type of publicity are newsrelease (also know as press release), photographs and feature stories. Marketershave less control over the nature of the publicity that their organisation andproducts receive than they have over their advertising, personal selling andsales promotions messages. Upon receiving a news release, for instance, theeditor or broadcast station programme director may choose to throw the releasein the waste paper basket, change the hording, or print or broadcast it in theoriginal form. The disposition of the news release is entirely in the hands of themedia and cannot be dictated by the marketer. Publicity may be negative aswell as positive. Some products and brands have received bad publicity; forexample cigarettes, wings, artificial sweeteners have been branded unsafe orunhealthy in the publicity which they would rather have done without. Many a
  • 7. companies and trade association officials attempt to develop favourableworking relationships, with the media in order to minimise bad publicity. Theyrealize that such communications to the public may have every adverse impactupon the image of the organisation. PERSONAL SELLINGPersonal selling consists of persons to communication between the salespersons and their prospects. Unlike advertising, it involves personalinteractions between the sources and the destination. Advertising aims atgrouping the shotgun approach, while personal selling aims at individuals theright approach. Sales persons are in the position to tailor their messagesaccording to the unique characteristics of each prospect. Further, by observingand listening, sales persons receive immediate feedback on the extent to whichtheir messages are getting across. If feedback indicates that the message is notgetting across, the sales person may quickly adjust it or the method of itspresentation.Personal Selling :Personal selling may be a very intense means of promotion.Consumers can easily leave the room-during a TV commercial, ignore a storedisplay. The most effective method of promotion probably is to have salesperson provided that the organisation has sufficient funds. The most effectivemethod of promotion probably is to have sales person call upon every targetconsumers, for many institutions, especially those that appeal to the massmarket, this would be terribly inefficient. As a result, they employ massmarketing techniques such as advertising, personal selling is very important inindustrial marketing. PUBLIC RELATIONSMarketers engage in public relations in order to develop a favourable image oftheir organisation and products join the eyes of the public. They direct thisactivity to parties other than target consumers. These "other" include the publicat large labour unions, the press and environmental groups. Public relationsactivities include sponsoring, lobbying and using promotion message topersuade members of the public to take up a desired position. The term publicrelations refers to a firms communication and relationships with the varioussections of the public. These sections include the organisation customers,suppliers, share holders, employees, the government, the general public and thesociety in which the organisation operates. Public relations programme mayhigher be formal or informal. The critical point is that every organisation,
  • 8. whether or not it has a formalized (organised, programme, should be concernedabout its public relations. ADVERTISING EFFECTIVENESSAdvertising is an art not a science. Effectiveness of which cannot be measuredwith a mathematical or empirical formula some advertisers argue thatadvertising efforts go to waste, but every advertiser is keenly interested inmeasuring or in evaluation of ad. effectiveness. Testing for the effectiveness ofad. will lead advertisement testing must be done either before or after the adhas done in the media. It is of two types, pretesting which is done before the ad.has been launched and one is referred to as cost testing which is done beforethe ad. has been launched and one is referred to as cost testing which is doneafter launching the advertising campaign. The basic purpose of advertisingeffectiveness is to avoid costly mistakes, to predict the relative strength ofalternative strength of alternative advertising strategies and to increase theirefficiency. In measurement of ad. effectiveness feed back is always useful evenif it costs some extra expenditure to the advertiser.Sales-Effect :Communication-effect advertising research helps advertisers assessadvertisings communication effects but reveals little about its sales impact.What sales are generated by an ad that increases brand awareness by 20% andbrand preference by 10%?Advertisings sales effect is generally harder to measure than its communicationeffect. Sales are influenced by many factors besides advertising, such as theproducts features, price, availability and competitors actions. The fewer ormore controllable these other factors are, the easier it is to measureadvertisings effect on sales. The sales impact is easiest to measure in direct-marketings effect on sales. The sales impact is easiest it is to measure in direct-marketing situations and hardest measure in brand or corporate-image-buildingadvertising.PROGRESS TESTSThese assess the various stages of buyer awareness, preference, buyingintention and the actual purchase in relation to ad. effort. They are called saleseffect tests.Measuring Sales Response to Advertising :
  • 9. Though increase in sales in the true measure of advertising effectiveness, inreality it is difficult to measure the increase that is due to a particularadvertisement. It is rather difficult to correlate the response in sales with theadvertising programme. However, a few methods have ben discalled in thefollowing paragraphs which are generally used to measure the sales response toadvertising.The Netapps Method :The term Netapps has been framed from the term net-ad-produce-purchases.This method, which has been developed by Daniel Starch and Staff company,requires the measurement of both readers and non-readers who purchased andwho did not purchase the brand under investigation. The netapps method isuseful in the relative measurement of the sales-effectiveness of variousadvertising approaches. But the method is subject to a high level of falsereporting and open to interviewer bias. Moreover, we have consideredadvertising influence as the only factor which results in a purchase. There maybe, and often are, other variables which affect purchases.Sales Results Tests :The additional sales generated by the ads are recorded, taking several routes.Past Sales before the ad and sales after the ad are noted. The difference isattributed to ad impact.Controlled Experiment : In experimental market, any one element of marketingmix is changed. It is compared with the sales of another similar market. Theelements presence observance is a reason for difference in sales.Instead of two markets, the experiment can be carried on the two groups ofconsumers.The inventory audit is dealers inventory before and after the ad is run.Attitude TestsThis is an indirect measurement of the post-testing effects of ads on attitudestowards the advertised product or brands. The change in attitude as a result ofadvertising is assessed. The assumption is that favourable attitude towards theproduct may lead to purchases.
  • 10. Most ads are designed to either reinforce or change existing attitudes. Anattitude is a favourable or unfavourable feeling about a product.