ATL BTL research paper


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Guide to ATL & BTL Marketing

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ATL BTL research paper

  1. 1. 1 AbstractThe annals of Marketing Management have witnessed a tug of war between advertising andsales promotion since inception. But in the early phase of twenty first century this war hastaken a new avatar in form of Above - The- Line and Below - The- Line activities, wideningboth scope and intensity of this war. Above-the-line propagated traditional marketingchannels that strive to reach a mass audience with messages that reinforce a brandcommunicate general product information or inspire an emotional response. ―Below-the-line‖initiatives, by comparison, acts like traditional direct marketing efforts – they aspire toestablish targeted relationships between marketers and individual consumers, and offercomparable ease in measurability. With increase fragmentations and demographic along withthe increased pressure to increase effectiveness of marketing communication soon BTLactivities started substituting ATL activities and there has been a steady growth in BTLexpenditure in this century . With its unique ability to personalize and customizecommunication this form of communication is slowly replacing the mass media advertising.This paper attempts to highlight these trends and also comment about the existing channelsthat BTL activities employ. In order to substantiate the claims, a case study has beenspecifically designed in order to show the relevance of BTL activities in this fragmentingworld.Research Objective: To investigate the relevance of Below -The- Line activities to currentmarketing communication practices.Research Design: Analysis of secondary literature and industry documentsResearch Methodology: This paper has been written by analyzing the secondary literatureand other industrials documents .Data came from primary and secondary document sites onthe World Wide Web arising from the reduction in the advertising expenses. Documents fromthe marketing journals commenting on the obsolescence of mass media advertising in thecontext of fragmented media, fragmented audience and slowly decreasing retention levels. Inaddition to this white paper on Vertical Market Trends in Direct Mail and the Impact onProduction Service Providers, based on dozens of interviews with executives at largecompanies engaging in direct mail marketing—including agencies, printers and otherindustry experts— examines 7 key trends, and focuses particularly on market conditions fordirect mail printers and letter shop firms.
  2. 2. 2Introduction of the TopicThere are two kinds of marketing strategies that can be used to promote any product: "above-the-line" (ATL, essentially advertising in the mass media) and "below-the-line" (BTL). Thesecategory names reflect the business practices of advertising agencies. Agencies generallymake commission on placement of advertisements in newspapers, magazines and cinema,and on television, radio and billboards, a fee that appears "above the line" on their bill.Traditionally, other forms of promotion—events, direct marketing, email promotions, textmessage promotions, premiums, price reductions, public relations activities, sponsorship,trade shows, exhibitions, sales literature and catalogues—were charged at a fixed fee and thusappeared "below the lineAbove-the-line propagated traditional marketing channels that strive to reach a mass audiencewith messages that reinforce a brand communicate general product information or inspire anemotional response. ―Below-the-line‖ initiatives, by comparison, acts like traditional directmarketing efforts – they aspire to establish targeted relationships between marketers andindividual consumers, and offer comparable ease in measurability. Traditionally ATL andBTL strategies have been considered distinct, and BTL the poor cousin. BTL activities weregenerally used to complement the main mass media marketing activities and usually afraction of marketing resources were allocated for these activities. BTL activities first shotinto prominence when ATL activities for products which have unwholesome demand wereproscribed by the Socio-legal restrictions. Even though BTL activities started off to fill in forATL activities, increasingly, BTL strategies are now recognized as economical, unique, andpersonal ways to achieve "cut-through" in the supersaturated advertising environment. Figure 1.1 Channels of BTL and ATL activities
  3. 3. 3 Above-the-Line Media Below-the-Line Media Are targeted to individual consumers, 1. Are tailored to reach a mass audience based on their expressed needs and preferences 2. Establish brand identity or reinforce Issue a ―call-to-action,‖ inspiring specific emotional concepts surrounding a customer activity or tailored messages product or brand about a product or brand 3. May or may not drive customer Drive individual responses response Are highly measurable, allowing 4. Are difficult – if not impossible – to marketers insight into their return-on- measure with any accuracy investment, as well as those tactics that are (and are not) working Establish one-to-one relationships 5. Cater to the mass market between consumers and marketers Figure 1.2 Differences s in BTL and ATL activitiesEvolution of below -the- line activitiesIn a market rapidly adapting to changes in technology, available information and heightenedconsumer demand, traditional, brand-oriented advertising is no longer the primary driver ofcustomer behavior. Whether it’s reflected in dwindling print newspaper circulation or thestagnant market for network television commercials, significant evidence suggests that themarketing landscape has fundamentally shifted – from an ―above-the-line‖ focus on reachinga broad population with emotionally-oriented appeals, to a ―below-the- line‖ approach thatstresses targeted, customer-centric communications, measurable results and concrete return-on-investment.We believe that the metaphorical ―line‖ separating marketing philosophies (often quoted, butnever precisely defined) is reflected in three key qualities that separate today’s emergingpromotional methods from the top-down advertising monologue of the past. Acting inconcert, they embody the universal elements of successful below-the-line marketing efforts:
  4. 4. 4  Perception – The extent to which a consumer feels that he or she is engaged as an active participant in a marketing dialogue, rather than a target of an aggressive direct sales or branding effort  Interaction – The extent to which consumers are empowered to respond to marketing communications via preferred channels that are both convenient and accessible  Measurability – The extent to which a marketer can track the results of an individual initiative, determine commensurate return-on-investment and adjust future campaigns to provide for an enhanced chance of success Figure 1.3 Framework of BTL activitiesThe paper, based on exhaustive secondary explores the key factors that are leadingsophisticated marketers in all vertical segments to move dollars away from ―above- the- line‖(ATL) and toward direct, measurable ―below-the-line‖ (BTL) marketing tactics.
  5. 5. 5Channels of BTL activitiesDatabase marketing: It involves use of proprietary database of consumer records which canenhance prospect or customer data sources with unprecedented demographic, lifestyle andtransactional data. It can be utilized for tuning marketing offers targeted at new prospects --and provide their current customers with products that more closely match purchasingpreferences and habits.Database marketing services include:1. Data Enhancement/Append: Appending of desired information, including:  Contact information (email, telephone, and postal addresses)  Demographic information (age, gender, marital status, children, ethnicity)  Lifestyle information (income level, home ownership, interests, and hobbies)2. Data Quality and Maintenance: Performing full data cleaning to achieve the highestquality  Duplicates are identified and removed  Postal address standardization  Invalid records, such as "do-not-call" or "do-not-mail" are removed ensuring compliance with anti-spam regulations3. Database Modeling: Custom querying and modeling for complex marketing strategiesthat require comprehensive analysis and targeting.4. Database Management: Database collection and maintenance to more complexdatabase management.Mail marketing: It involves creation of compelling branded Mail/email templates andcampaign messages, and also our data driven services to develop precise targeting to reachthe highest number of quality prospectsEmail marketing services include:1. Access to responsive online consumers: Targeting the message to proprietary opt inconsumer databases, which offers over unique consumer email addresses through:  Carefully selected consumer profiles that fit their audience  Predefined niche audience segments2. Response analysis: On-going reporting and analysis to help clients assess results andmake adjustments if needed.
  6. 6. 6  Full campaign stats – Mails/emails sent, delivered, opens and click rates  Responder snapshots of demographic, geographic and lifestyle informationInteractive services: By designing online campaigns that generate valuable and conversionsby the use of Web Properties, Affiliate Network and Search Engine MarketingAffinity marketing: Enhancing brand value and gaining new customers by affinity programslike collaborations with  Veterans Organizations  Sportsmens Organizations  Conservation and Wildlife Advocacy Organizations  Seniors Advocacy Organizations  Political Organizations  Religious Organizations  Youth Activity Organizations  Ethnic Group Advocacy Organizations  Cause Based OrganizationsDirect Response Print: It’s most common form today is infomercials. It is achieved byeliciting a direct response via television presentations. Viewers respond via telephone orinternet, credit card in hand.Other media, such as magazines, newspapers, radio, and e-mail can be used to elicit theresponse, but they tend to achieve lower response rates than television.Event Marketing: It involves a strategic-based face-to-face contact designed to impact abrands perception among its constituents. It is set of promotional activities involving anevent such as a sporting or social event, designed to bring a product to the attention of thepublic
  7. 7. 7Promotional Marketing: It is a non-personal promotional effort that is designed to have animmediate impact on sales. Sales promotion is media and non-media marketingcommunications employed for a pre-determined, limited time to increase consumer demand,stimulate market demand or improve product availability.Examples include:  Coupons  Discounts and sales  Contests  Point of purchase displays  Rebates  Free samples (in the case of food items)  Gifts and incentive items  Free travel, such as free flightsSales promotions can be directed at the customer, sales staff, or distribution channel members(such as retailers). Sales promotions targeted at the consumer are called consumer salespromotions. Sales promotions targeted at retailers and wholesale are called trade salespromotions.Current Scenario in the field of BTL activitiesDespite general growth in advertising and marketing services expenditures -- as well as aone-year spike in broadcast television spending brought on by the quadrennial Olympics/U.S. presidential election cycle – market spending data suggest that above- the-line marketingis not fairing well compared to the industry at large. In 2006, ATL spending (encompassingsuch channels as television, radio, newspapers, magazines and yellow pages) is expected togrow 5.6 percent, a full 1.7 percent behind the industry as a whole. By 2007, that differencewill become more pronounced, as ATL spending growth is projected at just 4.6 percent forthe year, compared to an equivalent 7.3 percent industry growth. According to e-Marketer,spending on online advertisements – a unique medium that offers reach and brand exposurealong with the one-to-one benefits of BTL marketing – will reach $12.9 billion in2005, representing an increase of more than 34 percent from 2004 spending. By 2009, annualonline expenditures should hit $22.3 billion, reflecting an average annual growth of nearly 21percent since 2002.Gains are being realized among virtually all media that provide the BTL
  8. 8. 8advantages of perception, interaction and measurability. Whether in direct mail(projected growth 7.5 percent in 2005, according to the Winterberry Group), promotions (3.7percent, according to PROMO Magazine) or e-mail marketing (31 percent, according toJupiter Research), recent spending and marketer commentary indicate a real and growingpreference for tactics based on established data and quantifiable results. The world’s largestmarketing service providers, likewise, are adapting to the business imperative of one-to-onecommunications. In doing so, they appear finally poised to transition out of the massadvertising-centric focus that has for so long defined their business. WPP Group, for example– one of the world’s largest advertising and marketing services holding companies, withannual revenues of approximately $10 billion – recently announced that―media investmentmanagement continues to show the strongest growth of all our communications servicessectors, along with [below- the-line] direct, Internet and interactive and healthcarecommunications.‖ Figure 1.4 Growth in expenditure of BTL and ATL activities
  9. 9. 9 Figure 1.5 Composition of BTL and ATL activities Figure 1.6 US Marketing Spending, 2001- 2007Expenditure estimates say a lot about where sophisticated marketers are focusing theirefforts, but they don’t address the more fundamental question of why. Why, after so manyyears of success with above-the-line methods, are marketers finally changing theirapproach to reaching customers and fostering profitable relationships? And why docustomers appear so willing to accept this new communications philosophy? Thefollowing seven trends explore the factors, both external and internal, that are contributing tothis emerging marketing emphasis. Specifically, it identifies seven key trends that are directly
  10. 10. 10impacting the allocation of marketing budgets for both ATL and BTL campaigns. Theyinclude: 1. Changing consumer demographics decrease the influence of traditional mass media (i.e. ‖one-size-fits-all‖) marketing messages 2. Growing consumer sophistication heightens the demand for channel-agnostic communications 3. Widespread marketing ―clutter‖ diminishes the impact of commercial messages that don’t address specific and individually relevant consumer needs 4. Enhanced information availability empowers both marketers and consumers with insight that allows for precise customer targeting and intelligent purchase decisions 5. Heightened client pressure to deliver quantifiable value by evaluation of ROI of the marketing initiatives , forces marketing service providers – especially agencies – to re-evaluate services platforms 6. Growing effectiveness of ―multi channel‖ campaigns (those that cross multiple media) reinforces demand for tactics that establish one-to-one relationships between marketers and consumers 7. Rapid technological advances allow for consumer/marketer interactions that are frequent, easier and more relevant than previously possibleTrends Impacting BTL Marketing Budgets1.) Changing consumer demographics decrease the influence of traditional mass- media(i.e. "one-size-fits-all”) marketing messages.2. Growing consumer sophistication heightens the demand for channel-agnosticcommunications.3. Widespread marketing “clutter” diminishes the impact of commercial messages thatdon’t address specific and individually relevant consumer needs.
  11. 11. 114. Enhanced information availability empowers both marketers and consumers withinsight that allows for precise customer targeting and intelligent purchase decisions.5. Heightened client pressure to deliver quantifiable value forces marketing serviceproviders – especially agencies – to re-evaluate services platforms.6. Growing effectiveness of “multichannel” campaigns (those that cross multiple media)reinforces demand for tactics that establish one-to-one relationships between marketersand consumers.7. Rapid technological advances allow for consumer/marketer interactions that aremore frequent, easier and more relevant than previously possible.
  12. 12. 12Limitations of the ResearchThis paper has not taken into account the considerations that how BTL activities should becustomized and designed with respect to various industries and segments. It also fails toaccount for the relevance of a BTL activity to multicultural society. It also fails to considerthe linguistic considerations of the people while customizing these activities.Gap AnalysisThis research moves out of the world of Advertising and sales promotion and set up a newstandard in the field of marketing communication. Though the existing literature talks aboutindividual channels like direct mailing and event promotion in detail, there is no researchpertaining to relevance of all the BTL activities. The existing research highlights the new andmodern techniques of marketing communications but it fails to consider it a front end forceand it always complements the BTL activities with ATL activities. This paper attempt to defythis convection and shots BTL activities into the prominence just like ATL shot intoprominence a century agoIn SummaryWith an increasingly complex array of promotional options at their fingertips,marketers continue to search for solutions that deliver the essential concepts of perception,interaction and measurability offered by the below-the-line marketing approach. Caughtbetween the contrasting needs to grow profitability and meet the demands of a sophisticatedcustomer corps, this dual imperative has resulted in a significant shift in marketing emphasis– away from mass-oriented media and toward direct, targeted and return-on-investment-oriented channels including direct mail, direct response broadcast/print, e-mail, eventmarketing, online advertising, insert media, promotions and search engine marketing.To marketers, the go-forward challenge is to identify the appropriate media mix for theirbusiness, encompassing both above-the-line (for branding and identity) and below-the-line(for customer acquisition, retention and loyalty development) methods. Service providers thatsuccessfully intertwine these multiple channels stand to meet those needs more effectivelythan providers still mired in a siloed, single- channel approach.