A Comprehensive Project report on Indian Advertising Industry

TABLE OF CONTENT
ChapterNo. Particular Page No.
Chapter –01 Introduction about Industry 1
Chapter –02 Research Methodology
2.1 Objectives of the study 13
2.2 Research Design 13
2.3 Data Collection and sources 13
2.4 Limitations 14
Chapter - 03 Global Scenario of Industry 16
Chapter - 04 Indian Scenario of Industry 20
Chapter - 05 Advertising Agencies
5.1 Study on Agencies 29
5.2 Types of Agencies 29
5.3 Functions of Advertising Agencies 32
5.4 Services Offered by Agencies 33
5.5 Agency Personnel 34
Chapter - 06 Key Players of Advertising Industry 37
Chapter - 07 PEST Analysis
7.1 Political Factors 49
7.2 Economic Factors 55
7.3 Social Factors 59
7.4 Technological Factors 62
Chapter - 08 Porter’s Five Force Model
8.1 Threat from new entries 69
8.2 Threat from Substitute 70
8.3 Bargaining Power of Buyers 71
8.4 Bargaining Power of Suppliers 73
8.5 Rivalry among Competitors 75
Chapter -09 Strategic Analysis 78
Chapter -10 OT Analysis 85
Chapter -11 Conclusion & Bibliography 88

S.V.INSTITUTE OF MANAGEMENT, KADI Page1
Chapter 1
Introduction about
Industry

Introduction
ORIGIN OF ADVERTISING
The origins of advertising lie thousands of years in the past. One of the first known methods of
advertising was an outdoor display, usually an eye-catching sign painted on the wall of a
building. Archaeologists have uncovered many such signs, notably in the ruins of ancient Rome
and Pompeii. An outdoor advertisement excavated in Rome offers property for rent, and one
found painted on a wall in Pompeii calls the attention of travelers to a tavern situated in another
town.
As much as some three thousand years ago Papyrus sheets were used in Thebes in Egypt for
announcing the reward for return of runaway slaves .The first advertisement was somewhat in
the form of stenciled inscriptions. Which were found on earthen bricks prepared by the
Babylonians about three thousand years before Christ. The bricks carry the name of the temple in
which they were used and the name of the king who built it, just as a modern public building
which contains a corner stone or stone tablet with the names of officials in office when the
structure was erected. The method was to cut a stencil in hand stone and with it each brick was
stamped while the clay had been in its son stage. The kings who did this had advertised
themselves to their subjects who could be read in hieroglyphics"
In medieval times a simple but effective form of advertising was very popular. Merchants
employed the so called "town criers" who shouted the praises of the merchants' wares and the
arrival of trade-ships. Printed advertising played no big role until the invention of the printing
press by Johannes Gutenberg in 1445. Now the printers and later the merchants used little flyers
to advertise their products these flyers often contained characteristic symbols of the guild
members and the tradesmen and were also used as a poster on walls. This form of advertisement
lasted for a very long time.

In the olden days, advertisements were more passive and extremely limited in scope. The earliest
forms of advertisements were sign - boards and writings on the walls of prominent buildings.
Sampson (1874) in his History of Advertising, which was first published in 1874, points out that
" signs over shops and stalls seem naturally to have been the first efforts in the direction of
advertisements and they go back to the remotest portions of the world's history ''. These early
signs were, for the most part had been made of stone or terra cotta "and set in to the pilasters at
the sides of the open shop fronts". Later, signs were hung over the walks and above the entrances
of shops. Some of them had been extended entirely across the streets.
In the 1880s a new era of advertising began; new methods of manufacturing led to greatly
increased outputs and decreased costs for the producers of consumer goods. The products at that
time could be packaged at the plant itself. Moreover, the telegraph network came into existence
and a network of rail - roads, had also crisscrossed the continent. All these were the factors,
which allowed a nation-wide distribution and nation-wide advertising. This state necessitated the
growth of advertising agencies and dictated their activities. The most widely advertised
consumer products at that time had been the patent medicines.
Broadly speaking the history of advertising might be divided into six periods or stages as
follows:
a. Pre-printing period, prior to the Fifteenth century
b. Early printing period from the Fifteenth century to about 1840
c. Period of expansion, from 1840 to 1900
d. Period of consolidation from 1900 to 1925
e. Period of scientific development, from 1925 to 1945
f. Period of business and social integration from 1945 to the present

S.V.INSTITUTE OF MANAGEMENT,
Pre- Printing Period
The 'Town crier' was the first means of supplementing sign advertising during the Pre
period. The 'criers' had charters from the Government and were often organized in a sort of
union. Their numbers were usually restricted. In the province of Berr
1141, twelve 'criers' organized a company and obtained a charter from Louis VII giving them the
exclusive privileges of town crying in the province. The Power of commercial criers grew until
they were able in some instances
to employ a 'crier'.
Early Printing Period
The invention of the printing press and the revival of learning meant much to business. It had led
to the production of advertisements in large quant
English advertisement was a 'handbill' or 'poster' announcement written by William Caxton in
1472. A copy of that advertisement
advertisements in Kerala from early periods to the present time are shown in Plate No.
Plate 1 First Printed Advertisement
NT, KADI
The 'Town crier' was the first means of supplementing sign advertising during the Pre
union. Their numbers were usually restricted. In the province of Berry, in France, in the year
they were able in some instances to obtain an edict from the ruler of the land forcing shopkeepers
to the production of advertisements in large quantities for wide distribution. The first printed
1472. A copy of that advertisement is exhibited in Plate No. - I and the changing styles of
from early periods to the present time are shown in Plate No.
1 First Printed Advertisement
Page4
The 'Town crier' was the first means of supplementing sign advertising during the Pre-printing
y, in France, in the year
ain an edict from the ruler of the land forcing shopkeepers
ities for wide distribution. The first printed
I and the changing styles of
from early periods to the present time are shown in Plate No. - I I.

Plate 2Changing Style of Advertisement
1
A typical advertisement of a health tonic appeared in ‘Nazarene Deepika’ on 17 May 1905.
2
An advertisement of a tablet which can be used for Fever, Asthma etc. appeared in ‘Nazarene Deepika’ 29 April
1905.
3
An Advertisement of Safety Matches.
4
An advertisement of Bath Soap.
NT, KADI
Plate 2Changing Style of Advertisement
1
3
A typical advertisement of a health tonic appeared in ‘Nazarene Deepika’ on 17 May 1905.
Page5
2
4

The Translated version of the same which was made by Dr. Edward Pousland of Worcester
Junior College would read as follows: "If anyone, cleric or layman wants to buy some copies of
two or three service books arranged according to the usage of Salisbury Cathedral and printed in
the same desirable type in which this advertisement is set. let him come to the place in the
precincts of Westminster Abbey where alms are distributed, which can be recognized by a shield
with a red central stripe (from top to bottom), and he shall have these books cheap. The same
advertisement was also followed by another warning message as: 'please don't tear down this
notice’. By the middle of the Seventeenth Century, weekly newspapers, called 'Mercury’s,
started to appear in England. The printing press was then being used in a fashion, which led to
the gradual growth and development of advertising by providing a practical, readily available
medium to deliver advertising messages to the literate portion of the public. Many of the early
newspaper advertisements were in the form of announcements of a pure informative nature.
Beverages, Cosmetics and patent Medicines had a prominent place among the advertisements
appeared in media. Well-known among early advertisers were the importers of products, which
were new to England. For instance, the first offering of coffee was made in a newspaper
advertisement in 1652, followed by an offering of chocolate in 1657 and of tea in 1658.
England was the Centre of advertising growth during the first half of the early printing period. It
also began to develop in America in a significant way in the 1700's. Early American advertising,
however, was largely devoid of the exaggeration found in English advertisements. By comparing
patent medicine advertising in these two countries up to 1750, James Young (1961) says: "While
the English proprietor sharpened up his adjectives and reached his vitriol, in America, with rare
exceptions advertisers were content merely to list by name their supplies of imported English
remedies."
In general, the growth of advertising during this period paralleled the increase in population and
in the number of periodicals and newspapers in circulation in both Europe and the United States.
However, in 1712, England levied a tax on newspapers and advertising, which retarded the
growth of newspapers as well as the advertisements in newspapers. It caused the bereavement of
such a leading publication as 'Addison’s spectator''. During that time the tax on each
advertisement, regardless of size, amounted to 84 cents at its peak. In England the taxes on both

newspapers and advertisements were abolished in 1853. The circulation of newspapers in the
United States, where no tax was imposed, was much greater than in England during this period.
Consequently more advertisements advertisers had emerged in the United States when compared
to England. Printed advertising was generally in use until the end of the Eighteenth century.
Period of Expansion
This period includes, roughly, the sixty years between 1840 and 1900. It was during these six
decades that the great changes, which had a vital influence on the business of advertising, were
witnessed in the United States. By 1840, railroads in the United States were recognized as an
efficient means of transportation. This had led to the broadening of markets and had resulted in
an increase in the number of advertisements in magazines, which served large territories. The
growth in the numbers and the circulation of magazines were mainly due to the development of
rapid and long distance transportation.
This parallel movement is rather striking, while it does not prove a casual relationship between
the growths of long distance transportation and advertising media, it is logical to believe that the
increase of transportation facilities did have a definite influence on the rapid rise in the number
of publications. In fact, the increased revenue from the sale of advertising space encouraged a
growth in the number of publications and their wider circulations.
Advertisements during that period were mostly trade advertisements in nature, announcing the
arrival of shipments of Coffee, Tea, Silk cloth, etc. Advertisements at that time were also
designed especially for dealers in consumer goods as well as grocery or dry goods
Advertisements were mostly handled by printers and publishers of newspapers, who used to sell
advertisement space to procure necessary finances for their survival and growth.

Period of Consolidation
This period stretches over a period of 25 years from 1900 to 1925.1n 1911 a crusade against the
ranker types of untruthfulness in advertising was launched in the United States". Printers Ink.
Inc., the Curtis Publishing Company and other organizations led the fight to reduce or eliminate
the use of gross exaggeration, false testimonials and other forms of misleading and untruthful
advertising. It was also during this period that trust - busting, expose and reform programs
became popular. It is not surprising that advertising was caught up in this clean up movement.
The Associated Advertising clubs of America helped in launching a campaign to promote
truthful and ethical advertising. Consequently, several codes for truth in advertising were
devised. Probably the most famous was the Printers Ink. Statute, published in 1911. It was a
model that indicated the types of activities that were considered ethical, unethical and
questionable.
The establishment of the Audit Bureau of Circulations in 1914 was another move for fewer
untruths in the field. This Bureau sewed to validate the circulation statements made by
publishers. This was a measure for self-preservation but it sewed to consolidate the gains made
in the heyday of publication and advertising growth. Later several advertising organizations and
groups like the Advertising Federation of America. American Association of Advertising
Agencies, Association of National Advertisers, Audit Bureau of Circulations, Direct Mail
Advertising Association. Outdoor Advertising Association and various publishers associations
were formed or became active as a result of these Changes. These groups tended to give a semi-
professional character to the advertising business. They have had some influence in solidifying
the business and in raising the ethics somewhat above the levels of previous periods.
It is interesting to note that the American Association of Advertising 19 Agencies in 1918 placed
little or no emphasis on the importance of studying the consumer, his buying habits, needs and
desires. This factor emerged as a vital element in advertising later by advertisers. By the end of
this period many advertisers had established their own market and consumer research
departments and specialized research firms had been organized to make independent and
unbiased investigations for advertisers and media. This increased the quality of advertising
strategy and the performance as well as benefits rendered to consumers. World War I witnessed

advertising as a profession and regarded it as a tool of social engineering with advertisements
being used to mobilize public opinion in favor of the war. The support of social scientists and
psychologists to the U.S advertising industry in 1920's contributed towards marking this industry
more dynamic and imaginative. Product appeals were emphasized less and greater prominence
had been laid on appeals such as fear, hope, emotions, insecurity, attachments, desires, etc. The
advent of Radio in 1920 marked a remarkable development in the advertising world.
The initial stages excluded the use of radio for advertising; only to be included two years later
with the W.E.A.F. broadcasting station in New York selling radio time to producers. Thus during
1920s advertisers and their agents had come to realize the possibilities of radios as a means for
attracting the prospective consumers of various products and services. With its drama and
immediacy, radio could convey their messages directly to the consumers who would not need to
purchase a publication or even need to be literates. By the mid 1920bs, advertisers' sponsored
programs on Radio were a common feature in the U S. Only to be joined by T.V.
Period of Scientific Development
This period saw the application of the scientific methods to resolve the problems of advertising.
Knowledge was systematized to a much greater degree than before and facts were observed,
recorded and classified through the application of various scientific devices.
There were a few "radical" advertising men who were so bold as to suggest that advertising be
subjected to tests to prove or disprove its ability to work the wonders claimed for it. Not until the
depression, starting in 1929, did these men get much of a hearing. But with advertising
appropriations receiving liberal cuts, both professional advertising men and advertisers set out to
test the effectiveness of advertising as a selling tool. Consequently, emphasis began to be placed
on consumer research with a view to making advertisements more meaningful and ethical.
Efforts in this direction include the Audience Research Institute formed by A.C. Nelson and
George Gallup in order to evaluate the advertisements on psychological basis, which had enabled
the businessmen in improving considerably the quality of advertisements.

During this period of scientific development serious attention was given by many agencies and
organizations to various methods for testing the sales effectiveness of advertising strategy, media
and copy. This was a new philosophy in the sense that it had meant subjecting the work of the
creative man, the artist, the person who depended upon his own insights and intuition to some
kind of performance yardsticks.
Period of Business and Social Integration
The post war years were characterized by prosperity in advertising. In the 1950s came television
which developed fast to the advertising-media .The growing popularity of T.V as an important
media of mass communication and recreation had contributed greatly in bringing about this
situation and had also provided the much needed momentum to the advertising business. This, in
its turn, had led to a host of American companies to start sponsoring T.V programmes. These
advertisers could demonstrate the use of their products and services and present well-known
figures to praise such products and services. They also could arrange emotions through
television.
With the passage of time, advertising assumed an important position as a means of mass
communication in Industrial societies. It not only generated greater sales but also had played an
active role in boosting the images of companies The increased recognition which the advertising
organizations attained as a part of the total fabric of the society had enabled such organizations
all over the world to establish themselves as an integral factor in the dissemination of vital
information retaining to various products and services beneficial to the society. Advertisements
also have become a common medium through which churches, political parties, labor groups,
trade associations and the ordinary people communicate their ideologies, ideas and concepts to
many of the public’s making up the total society. Advertising has also become an institution of
persuasion to promote such social and economic values as safety, health, education benevolence,
Liberty, democracy, free enterprise and tolerance.
Today, advertising is wide- spread all over the world in different countries. But advertising
trends vary from country to country. The turbulent environment of the 2oth
century, with rapid
changes in technology, products, processes, methods, cut throat competition and emergence of

new marketing challenges only indicates the significant role of advertising, which is expected to
play in the survival and growth of business units.

Chapter-2
Research Methodology

Research Methodology
2.1 Objectives of the Study
2.1.1 Primary objective
 To study on Advertising Industry in India
2.1.2 Secondary objective:
 To find out over all market condition of Advertising industry
 To study the political, economic, social, and technological factors affecting Indian
Advertising industry
 To compare the market competition among different players
 To study the growth of advertising industry in India
 To find out new opportunities for advertising industry in Indian market
2.2 Research Design
Exploratory research
Exploratory research of research conducted for a problem that has not been clearly defined.
Exploratory research helps determine the best research design, data collection method and
selection of subjects. It should draw definitive conclusions only with extreme caution. Given its
fundamental nature, exploratory research often concludes that a perceived problem does not
actually exist.
2.3 Data Source
Newspaper- Business Standard, Times of India, Economic Times, New Indian Express
Magazines- Pitch, Brand Equity, Impact, Campaign India, Alfas Reporter
References books – Strategic Management, Marketing Management, and Strategic Marketing,
Adverting and promotion (Belch)

2.4 Limitations
 Data is based on secondary sources. So, it may be insufficient
 Unavailability of financial data

Chapter-3
Global Industry
Scenario

Global Scenario of Advertising industry
Getting the best out of advertising is a highly skilled job. It requires the inputs of experts in many
different fields like writers, artists, photographers, designers, television production crews and
many others. Even the biggest advertisers cannot afford to employ all these experts. Almost all
advertising is therefore arranged through an advertising agency which provides the necessary
skill to turn the message into a memorable and effective advertisement. Advertising has not only
come to reflect pop culture but has also become an important element of economic growth.
Today, every person connected with the Indian economy or public should be fully aware what
advertising really is and why effective advertising campaigns can be performed by full-service
advertising agencies.
Advertising agency is one of the most important components of advertising industry. It has
played a significant role in the development of modern advertising. The advertising agency has
evolved to provide the specialized knowledge, skills and experience needed to produce effective
advertising campaigns. It provides a quality range of service greater than any single advertiser
could afford or would need to employ. An advertising agency is a firm that specializes in the
creation, design and placement of advertisements, and in the planning and execution of
promotional campaigns for products and services of their clients.
The Association of Advertising Agencies of America (AAAA) defines advertising agency as
“An independent business organization composed of creative and business people who develop,
prepare and place advertising media for sellers seeking to find customers for their goods and
services.”
The glamour, the unlimited expense accounts, and the exhilarating lifestyle - all these popular
portraits of life in the big-time advertising agency are misleading. Advertising is demanding,
challenging, hard work. It is also interesting and fulfilling. Advertising requires a mix of
personal abilities, considerable business skills, and an ability to work under pressure to meet
deadlines. Compared to larger industries, there are never many entry-level positions open in
advertising agencies (dozens rather than hundreds). And competition is stiff. The industry,
however, is constantly on the lookout for skilled, bright, articulate, creative and personable men
and women with a well-rounded education and a good business sense.

1. Period of early growth 1841 - 1865
The first advertising agency on record in the US was Olney B. Palmer. In 1841, Palmer
organized a newspaper advertising and subscription agency. By 1849 he had established offices
in the cities of New York, Boston, Baltimore and Philadelphia.
At this early fate, there were no directions of newspapers and no published rates for space to be
sold to advertisers. Palmer acted as an informatory agent in these matters to prospective
advertisers. In essence, he served as a salesman of space for publishers and they in turn, gave
him a commission of 25percent of such sales. The publishers found these methods of selling
more effective than trying to sell direct and advertisers, wishing to reach more than one territory
found value in such service.
Completion increased, and the usual price cutting occurred. Success seemed to depend upon
one’s ability to bargain with the publisher and advertiser. The natural result of this policy was a
general reduction in profits to the agency; this led to a search for new competitive tools which
would return a profit.
2. Wholesaling Period 1865 – 1880
George P. Rowell, who opened an agency in 1865, supplied the new competitive tool. Rowell
contracted with 100 newspapers to sell him a column of space each week for a year. Throughout
the wholesaling period, the agent continued as a seller of space for publishers.
This took on different forms, one of which was the exclusive right to sell space in certain
publishers. Thus, one agency developed a controlled list of religious papers, other “List of
Thirsty” household magazines. Any advertiser wishing to buy space in the controlled
publications was forced to buy through the exclusive wholesaler for that paper.

3. Semi Service Period 1880 – 1917
The wholesaling phase of agency work was checked when publishers began to establish their
own sales departments for selling space. Some of these departments sold direct to the advertiser,
others to the general advertising agency. Thus, the agency was forced to turn its attention
somewhat away from the particular function of selling space for publisher and toward the
function of buying space for the advertiser.
Early in the semi service period agencies offered to write the copy for the advertiser, thus giving
added weight to their claim of being servants of the advertiser. This concept of service was slow
to develop; but in the early part of the 20th
century, agencies began to emphasize strongly this
“free” service. One agency in 1905 advertised that it paid $28,000 a year for a copywriter. These
methods increased the agency business and forced most space sales to be made through them.
4. Service Period 1917 – Present
By 1917 the idea of service had grown until not only was copywriting done for the advertiser but
many other things as well. During the service period, many agencies have grown to the position
of advertising and marketing counselors for advertiser.
The service elements has modified the position of agencies to such a degree that radio and
television, network and magazine publishers have come to depend upon them as the primary
channel through which time and space are sold. Publishers claim to have had an important part in
encouragements of agencies to provide extra service to the advertiser. By provide advertising
with the kind of assistance that will improve the effectiveness of advertising, more time and
space naturally will be sold.

Chapter 4
Indian Market
Scenario

Study on Indian Scenario
At the Ancient Times
Advertising in India dates back to the Indian civilization. Relics of Harappa, Mohenjo-Daro
indicates names engraved on exquisite earthen, stone or metal works, which is comparable to the
present trade mark system. Paintings or writings on wall indicating slogans or stone engravings
indicate a form of advertising.
The earliest forms of advertising were mostly used for religious purposes. That is, advertising
was in the form of propaganda. To spread the teachings of Buddha, the emperor Ashoka of
Kallinga set up rock and pillar edicts all over the lndian Territory between 563 and 232 B.C.
These rock and pillar edicts can be called the forerunners of poster advertising of today. Thus, it
was the outdoor advertising that came to light with the point of sale display in market places. The
indoor visual communications were the wall paintings in the cave temples of Ajanta, Sanchi and
Amraoti. Literally the lndian Advertising starts with the hawkers calling out their wares right
from the days when cities and markets first began.
Till the advent of British rule in India, advertising was not taken for business purposes. The
reasons were that India was the unique example of household industrial activities. At the time of
British entry, India was in Village Economy stage where the relations between the producers and
consumers were direct. The local markets were weekly and the producers displayed their wares
by shouting and giving samples for promoting their trade. The skills of Indian artisans in the
areas of textiles - silk and cotton and metal works were all accepted and there was no need of any
special efforts of advertising.

At the British Ruling Time
British settlement and ruling from 1600 onwards brought about certain changes in our country.
British needed advertising efforts to popularize their goods, particularly the luxury goods. They
made it possible through the print medium. The first printing press was brought by Portuguese in
1556, which was used exclusively for printing Christian literature. It was only in 1780 that the
first lndian newspaper was started, namely the 'Bengal Gazette' in Calcutta. By 1786, there were
four weekly newspapers and a few monthlies published from Calcutta. It was in the 'Bengal
Journal' that all the government advertisements were printed during that period In 1790, ' The
Courier' , published from Bombay during that period also contained advertisements in various
lndian languages, namely Marathi, Guajarati, Konkani, Urdu and Kannada. In 1791, the
government Gazette was started in which all the Government advertisements in different
provincial languages were printed. Though the first newspaper in an Indian language was started
in 1833, it took pretty longer time to put advertisements in lndian languages. There were no
advertising agencies but the newspapers had provided the services of space selling.
The origin of commercial advertising in India is relatively recent. ‘B. Dattaram and Co.' was the
first advertising agency promoted in the country in 1905.The growth of lndian advertising too
has been slow with the pre-independence era. Only a few companies were engaged in the
business of advertising on an unprofessional basis and had remained almost confined to the
media buying services with Very little creative work. Until the outbreak of the World War 1
(1914-1918), most of the advertising was planned and placed by the foreign manufacturers.
During the First World War, the newspaper circulation was increased as the people were
interested in hot news of war affairs. During the post war period lndian market was flooded with
foreign goods that gave a lot of spurt to newspaper advertising so that more and more space had
been reserved for advertising.
After the First World War, the lndian agencies failed because of the acute competition, mostly
from the British and the American agencies. The Indian agencies had a tough time but could
learn the importance of agency business as a rich source of employment and earnings. It made

them to try the outdoor advertising media as many of the newspaper media were under the
control of foreign agencies.
In 1918, the first professionally managed modern advertising agency, 'Tats Publicity' was started
by Lastro mach a British army officer in Bombay, followed by D. Jekey More's operation in
1929 and the 'Thompson Advertising Agency' which started its operation in India in early 1930's.
In fact, 1930's can be considered s the period of consolidation in the history of lndian
advertising. The 'Swadeshi' movement made a turning point in the history of advertising in India
as this movement had led to the increased appearance of advertisements in the country with a
view to popularize Indian goods against the imported stuff.
Indian advertising has had many changing faces. The pro-independence advertisements were
mostly about ladies goods, gents' clothes, travelling, restaurants and hotels and entertainments
for the British people in India. Motor cars, electricity and lifts in houses were considered to be
the items of luxuries in those periods. Many of the early advertisements were about hotels four
wheelers, tea, gramophones, cotton goods, tailoring shops, etc., and their target audiences were
the British people in India, the princely families and the people from the upper strata of the
society. It is only after independence and the abolition of the princely order that a new born
middle class received attention of advertisers.
As against 14 Advertising agencies in 1914, there were 45 agencies in 1944, indicating over a
threefold increase in the number of agencies. However, the gross annual media billing was just
Rs. 5 crore. This indicates that the initial stages were marked by a slow growth in advertising
agencies in the country. Among the reasons cited for such a sluggish growth were the
unfavorable attitudes of companies towards advertising, limited market, slow pace of
industrialization and lack of competition.
The first full-fledged Indian advertising agency was set up in 1931. The increased competition
demanded a thorough improvement in the quality of advertising work and services. To improve
the art-work and copy illustration, Indian agencies used to send their employees abroad for

special training. The All India Radio started telecasting various programs in 1936. In 1939, The
Indian and Eastern Newspaper Society was founded to protect and promote the legitimate
interests of the newspapers and to deal collectively with the Government, agencies and the
advertisers. In 1941, Indian Languages Newspapers Association was formed to deal with the
problems of Indian language newspapers.
After World War 2
By the end of World War II, the political and economic scene underwent a sweeping change.
Consequently the scarcity conditions prevailing in the Indian economy gave much impetus to the
growth and development of light and small industries. In 1945, the Association of Advertising
Agencies of India (A.A.A.1) was formed to raise the standard of advertising and regulation of
advertising practices through a code of conduct. In 1948 Audit Bureau of Circulations of India
(A.B.C.1) was started on the lines of A.B.C of America. In 1952, The Indian society of
Advertisers was formed to promote the interests of advertisers so as to raise the standard of
Indian advertising. Until independence, the number of large - scale industries in India were
limited. Though there were some foreign cosmetic Industries in major cities, their products were
not of any natural popularity. After independence, the Five Year Plans were implemented and
several factories and large - scale projects have emerged. Consequently, production and
transportation facilities have increased tremendously. These spurts in various activities enabled
the distribution of products anywhere in the country and this marked the beginning of the
'Golden Age' of advertising in India.
Advertisements in the Indian print Media achieved a considerable importance only from the
beginning of the Twentieth century. Educational development and the popularization of media
had also contributed much to the expansion in the field of advertising in India. Advertisers' Club
of Bombay was started in 1955 and such clubs had emerged later in all the metropolitan cities in
India. The telecasting of programs through TV had commenced in India on 15th September 1959
at Delhi. Besides these, there are some other forms of publicity used by the advertisers, which
include the use of short films, slide shows, messages on the radio and in TV. TV advertising has
become popular in India as it is abroad. Film Advertising has also attained popularity among the
advertisers and the consumers alike in India to a large extent as these could be exhibited through

cinema theatres even in the remotest hamlets in the country by many advertisers. Radio
Advertising has been introduced by the All-India Radio 30 at Bombay from 1st
November 1967.
This pilot project was started with commercials being put over low power Vividh Bharati
transmitters at Bombay, Poona and Nagpur it has gained a wide popularity among the traders and
industrialists. Radio Advertising has also been introduced in Calcutta since September 1968 and
later extended to Delhi, Madras, Tiruchirappalli (l969); Chandigarh, Jullundur, Bangalore,
Dharwar, Ahmedabad, Rajkot, Kanpur, Luck now, Allahabad (1970), Hyderabad - Vijayawada
(1971) , Bhopal, Indore, Cuttack, Jaipur. Jodhpur, Patna, Ranchi, Trivandrum, Calicut and
Srinagar (1975). Advertisements have been accepted in many languages as tape recorded 'spots
of various durations Sponsored programs have been introduced in radios since May 1970. Now
more than 85 percent of the total population in the country is covered by the All India Radio
(A1R).
The television age has now dawned on India. It started in a very humble fashion by way of
experimental transmissions at Delhi on 15th
September 1959 the early television advertisements
were merely stills with voiceovers or short versions of cinema advertisements. Regular TV was
first introduced in 1965, and there has been a large scale expansion. The television set up in India
was delinked from the all India Radio on 1St
January1976 under its new name 'Doordarshan'. a
separate department meant for the full development of the medium and specialized skills peculiar
to television. Presently there are eight TV stations in the country. The year 1976 -77 was a
turning point in the history of Indian advertising. It was in this year that the Doordarshan (DD)
started accepting advertisements. Commercial advertising on television was introduced in a small
way on 1st
January1976 and the revenue from commercial advertising has shot up at an
astronomical rate, leading to a flooding of sponsored programs and the opening of a second
channel in Delhi and Bombay.
The first burst of public sector advertising was in the 1980's but what catapulted the industry on
to a higher plane was the landmark launch of color television on August 15. 1982. Color printing
in Newspapers and Magazines also brought about a new hue to their readability. To proclaim the
serious role of advertising in competitive scenarios, the Advertising Standards Council of India
(ASCI) was born. The 1980's also witnessed the first round of sponsored television

programming. From an Rs.100 million Industry in 1955, to Rs.1600 million in 1978 and to a
rupees 50,000 million industry in 1999, the advertising industry has traversed a long way.
Satellite TV has ushered in epochal changes in entertainment I awareness of trends and lifestyles
abroad. It has also dramatically expanded media options and influenced the styles and substances
of advertising, which is now richer and stronger in imagery and emotional appeal. The economic
liberalization of the past twelve years has created challenges as well as opportunities for
advertising. Indian products and services face fierce competition, both nationally and
internationally. International brand wars are now being played out on Indian turf. During the last
cricket world cup - 2003, the television image of giant, Coke bottles being wheeled on to the
pitch to serve cricketers "the official drink" was obliterated by that of cricket celebrities swilling
Pepsi and wise cracking the Pepsi slogan "Nothing official about it".
Market researches by various organizations have also been making spectacular strides in India.
Hindustan Lever, the biggest marketing conglomerate of consumer goods in India, for instance,
has pioneered the market research, particularly in rural India. Hindustan 'Thompson Associates
(HTA) and Lint as perhaps lead the country in market research competence. Specialist market
agencies such as MARG and MODE have also come up offering their specialized services to the
producers and marketers of both the industrial and consumer goods.
In 1994-95, the total TV Advertising in India came to the tune of Rs. 775 crore, in which the
DD's share was Rs. 400 crore. Out of these, Rs. 200 crore was advertised on the network and the
satellite channels accounted for the remaining Rs.175 crore, Consequent upon the Globalization,
the Indian advertising firms have also been entering into the sphere of global tie-ups. The styles
and the ways of presentation of advertisements have also been changing rapidly in India.
Advertising on the Internet is also growing rapidly in India. India's online advertising revenues
are expected to increase from $ 2.5 million in 1999 to $ 150 million in 2003.
Technological advancements have changed even the way of functioning of the advertising
agencies in India. Many of the advertising agencies in India are splurging on the latest gizmos
(note books, digital studios and media planning software). Computers and computer graphics
have brought new power, versatility, speed and value to advertisement production in our country.

Video editing is smarter, facile and swifter than ever before due to the use of computerized
gadgets from the U.S by the Indian commercial advertisers. Advancements in printing
technology and color processing have enabled the Indian advertisers to bring out hi-fidelity
advertisements of International standards in various magazines and periodicals. Video tonics and
special effects have also enabled the Indian advertisers to improve the production quality of TV
advertisements.
Today there are more than 50 channels, including 8 Malayalam channels, active and vying for a
share of the mind and money of the advertisers. Even the behemoth Doordarshan has woken up
to the market reality of fierce competition leading to a tie-up with the CNN for the new channel.
Advertisement Researches have indicated that even the rural folk in our country have started
watching programs like Oshin, Santa Barbara, Matrix, Superman, Tom and Jerry and Alias,
unlike the traditional programs filled with Mythological Indian heroes and heroines.
Some brilliant examples of timing and relevance of the history of Indian advertising In the recent
past have been Ankhita Jhaveri, the child model, who made 'Rasna' a household name in the
1980's; Penny Vaz and Remo Fernandas as they echoed ' Yehi hai right choice" for 'Pepsi';
Circus artists modeling for 'Action Shoes', which was broadcasted just before the tele-serial
'Circus'; 'Britannia biscuits' advertising Amjad Khan just before the immortal lines of 'Sholay'
film. The styles and ways of presentation of advertisements by various advertisers have changed
drastically during the recent years. Sachin Tendulkar voraciously grabbing a 'Britannia Tiger
biscuit' from an impish child, Mohammed Kaif sharing 'Lays potato chips' with film star Saif Ali
Khan and guys like Harbhaajan Singh. Rahul Dravid and Sourav Ganguly playing jungle games
with a lion in a 'Pepsi' advertisement have become the style of the day.
The number of advertisers on TV has grown quickly from just over 2000 in 1994 to a close of
5000 in 2002. At the same time, the number of companies generating 80 per cent of the TV
revenues had fallen from 223 companies in 1994 to 173 in 2002. In other words, the number of
advertisers on TV has almost doubled during the last 8 years, while the percentage of companies
accounting for 80 per cent of the total of Rs. 3900 crore of TV revenues has fallen from 11 per
cent to 3 5 per cent during the same time .

On analyzing the history of the growth in the media advertisement expenditure in India from
1985 to 2003, it can be seen that the media advertising in our country has shown a steadily
increasing trend from Rs.580 crore in 1985 to Rs. 15000 crore in 2003 (Table No.1)
Growth in Media Advertising Expenditure in India
SR.
NO.
Years Advertising Expenses
1 1985 580
2 1995 3000
3 1998 6824
4 1999 8437
5 2000 10000
6 2001 12000
7 2002 13500
8 2003 15000
(Business India, 2000)

Chapter 5
Agency

5.1 Study on Agency
An advertising agency or ad agency is a service business dedicated to creating, planning and
handling advertising (and sometimes other forms of promotion) for their clients. An ad agency is
independent from the client and provides an outside point of view to the effort of selling the
client's products or services. An agency can also handle overall marketing and branding
strategies and sales promotions for its clients. Typical ad agency clients include businesses and
corporations, non-profit organizations and government agencies. Agencies may be hired to
produce single ads or, more commonly, ongoing series of related ads, called an advertising
campaign.
5.2 Types of advertising agencies
Ad agencies come in all sizes, from small one- or two-person shops to large multi-national,
multi-agency conglomerates such as Omnicom Group, WPP Group, Interpublic Group of
Companies and Haves.
Some agencies specialize in particular types of advertising, such as print ads or television
commercials. Other agencies, especially larger ones, produce work for many types of media.
Lately, Search Engine Marketing (SEM) and Search Engine Optimization (SEO) firms have been
classified by some as 'agencies' due to the fact that they are creating media and implementing
media purchases of text based (or image based in some instances of search marketing) ads. This
relatively young industry has been slow to adopt the term 'agency' however with the creation of
ads (either text or image) and media purchases they do qualify technically as an 'advertising
agency' as well as recent studies suggest that both SEO and SEM are set to outpace magazine
spending in the next 3-5 years.
Not all advertising is created by agencies. Companies that create and plan their own advertising
are said to do their work in house. Today selection of ad-agency is very difficult. The advertiser
should make list of all possible agencies that can serve his purpose and the agency best qualified
to provide required and effective services are selected. Some advertiser may select more than one
advertising agency to handle effectively the various product lines.

Following are major types of advertising agencies that are currently serving the advertising
industry.
 Full Service Agencies
A full service ad agency is one that provides a range of marketing services. A full services
agency provides services that are directly related to advertising such as copywriting, artwork,
production of ads, media planning etc. It also provides such services in respect of pricing,
distribution, packaging, product design etc.
 Modular agencies
A modular agency is a full service agency that sells its services on a piece meal basis. Thus an
advertiser may commission an agency’s creative department to develop an ad campaign while
obtaining other agency services elsewhere. Or, an advertiser may hire an agencies media
department to plan and execute a program for advertising that another agency has developed.
Fees are charged for actual work undertaken.
 In House agencies
Those companies, which prefer to have closer control over advertising, have their own in-house
agency. This type is owned completely by the advertiser. It performs almost all functions that an
outside advertising agency would perform and that are why some people refer to it as full-service
advertising department of the advertiser. However, the difference between an in-house agency
and an advertising department is that the in-house agency can undertake to serve several other
clients, if the owner so desires, but an advertising department solely undertakes that work of its
owner and not of outside clients. Secondly an advertising department may not be equipped the
personnel and facilities, which an in-house agency would possess. In-house agency not only
provides control over advertising schedule and costs, but also offers convenience for its owner,
because it is just available in the same building as that of the head office of advertiser.
Such in-house agency also benefits the owner as it can bring revenue through agency
commission that are offered by the media and by way of fees that are collected from outside
parties for undertaking their advertising work. Such revenue increases the funds and profits of
the company. There is another version of in-house agency whereby advertiser handles the total

agency functions by buying service unit to buy time, space and place the ads. Such an In-house
agency is an administrative center (under the direction of an advertising director) that gathers and
directs varying outside for its operation.
 Creative Boutiques
These are shop agencies that provides only creative functions and not full-service. The
specialized creative functions include copy writing, artwork and production of ads, they charge a
fee or percentage of full service agencies, and as such most of them convert into a full service
agency or merge with other agencies to provide a wide range of services.
 Mega agencies
A significant of 1980’s is the development of mega agency. Agencies worldwide merge with each other
serve their clients in much better way. It was in 1986, Saachi & Saachi, a London based agency that
started the movement and at present it is the third largest agency network in the world.
 The Specialists Agency
There are some agencies who undertake advertising work only in certain areas. There are
agencies that specialize only in financial services or only in publicity or only in point-of-
purchase material etc. for instance Soubhagya advertising agency concentrate on specialized in
financial advertising.

5.3 Functions of an Advertising agency:
 To accelerate economic growth and create public awareness.
 To provide a total, professional, experienced service this is very personal in its nature.
 To take the advertiser's message and convert it into an effective and memorable
communication.
Communication and marketing decisions involve specialized expertise. Many companies that
design and produce products or offer services lack these specific capabilities. This is where
advertising agencies fit in. Advertising agencies exist to help companies to communicate with
the public, Market the company's product.
The process of advertising involves considerable specialized knowledge and expertise
 about people- their interests, preferences, needs, wants, lifestyles, expectations
 about media- their reach, their effectiveness, their specific appeal
 about the company and its product– and about competing companies and their products
Company with a
product or service
Ad Agency Media Public

5.4 Services offered by Ad agency
 Total Advertising Services
Strategic planning, creative development and media services for advertising, particularly in
television, newspapers, magazines and radio; providing the best creative designed to capture the
imagination of consumers
 Marketing Services
Provision of a number of advertising related services, including sales promotion, market
research, PR and event marketing.
 E-Solution Services
E-solution services, including system integration services, e-business consulting and customer
relationship management (CRM), Search Engine Marketing (SEM) and Search Engine
Optimization (SEO) and e-promotions using the Internet and mobile.
 Content Business
Sales of sponsorship, broadcasting and other rights, and the production and marketing of such
media / content as sporting events, films, TV programs, animated content, music and other forms
of entertainment.
 Integrated Media Services
Bringing value to both clients and media-related companies by offering a wide range of media
solution services.
 Sales Promotion
Providing comprehensive sales promotion planning designed to complement mass media and
other activities.
 Event Marketing
Assisting clients by providing dynamic vehicles for their messages in the form of on-the-spot
interactive communications.
 Integrated Branding Services
Assuring clients the highest quality of branding services for their communication needs.

5.5 Agency Personnel
 Production Team
Ad agencies may have their production team which includes Photographers, Printers,
Typesetters, Television Producers, etc. but since the work is very diverse most ad agencies
coordinate with freelancers or established production units for task to be completed. Production
workers are concerned with all the technical process of turning the final copy and art work into a
real ad for print, TV, radio.
 Storyboard artist
Storyboard artist is a profession specializes in creating storyboards for advertising agencies and
film productions. A storyboard artist is able to visualize any stories using quick sketches on
paper at any moment. Quick pencil drawings and marker renderings are two most common
traditional techniques, nowadays Flash, Photoshop and other storyboard applications are
gradually taking over, and digital camera is one of the latest techniques in creating storyboards.
Storyboard artist is also known as illustrator or visualizer, they are mostly freelance. Art
directors or film directors are the most likely type of peoples that would contact storyboard
artists and the deadline is always tight, overnight working is very common.
Most used storyboard applications are the Corel Painter and the Adobe Photoshop, some
storyboard artists nowadays begin and finish their work on computers using drawing software
and digital pencils like Wacom (Graphics tablet), in this way they save effort and most important
time which always has the first priority for a storyboard.
 Graphic designer
Graphic design is a form of visual communication using text and/or images to present
information, or promote a message. The art of graphic design embraces a range of cognitive
skills and crafts including typography, image development and page layout. Graphic design is
applied in communication design and fine art. Like other forms of communication, graphic
design often refers to both the process (designing) by which the communication is created, and
the products (designs) such as creative solutions, imagery and multimedia compositions. Graphic
design is traditionally applied to static media, such as books, magazines and brochures.

Additionally, since the advent of computers, graphicdesign is utilized in electronic media - often
referred to as interactive design, or multimedia design.
There are varying degrees of graphic design. Graphic designing involvement may range from
verbally communicated ideas, to visual rough drafts, to final production. In commercial art,
client edits, technical preparation and mass production are usually required, but usually not
considered to be within the scope of graphic design unless the client is also a graphic designer.
Although the term 'graphic designer' was first coined in the 20th century, the story of graphic
design spans the history of marks of humankind from the magic of the caves of Lascaux to the
dazzling neon’s of Ginza. After all, they share the same elements, theories, principles, practices
and languages, and sometimes the same benefactor or client. In advertising art the ultimate
objective is the sale of goods and services. In graphic design, "the essence is to give order to
information, form to ideas, expression and feeling to artifacts that document human experience.”
Fine art refers to arts that are 'concerned with beauty'...

Chapter 6
Key player of Industry

Key Players in AD Industry
Famous advertising agencies in world
 BBH (Bartle, Bogle&Hegarty) -- famous for Audi, Levi's, Johnnie Walker, British
Airways.
 Crispin Porter + Bogusky --famous for Subservient Chicken, works with Burger King,
Virgin Atlantic Airways, Volkswagen
 Wieden + Kennedy -- famous for remaining an independent agency; as well as Nike "Just
Do It", ESPN "This Is Sports center", Coke, EA, Starbucks, ESPN, Honda UK.
 JWT (formerly J. Walter. Thompson) -- works with Kelloggs, Unilever, and Diageo.
 Leo Burnett -- works with Procter & Gamble, Kelloggs, McDonald's, Marlboro,
Hallmark, and Heinz. Famous for creating characters such as Tony the Tiger, Snap
Crackle & Pop, the Jolly Green Giant, the Marlboro Man, and Charlie the Tuna.
 The MartinAgency -- UPS, GEICO, NASCAR, Miller (Lite, MGD), Hanes, and others
 N.W. Ayer & Son -- the first ad agency in the United States, coined "When it rains it
pours" (Morton Salt), "A diamond is forever" (De Beers), "Reach out and touch
someone" (AT&T), "Be all you can be" (United States Army), and others
 Ogilvy & Mather -- famous for the Rolls-Royce print ad with the headline "At 60 miles
an hour the loudest noise in this new Rolls-Royce comes from the electric clock", among
other ads
 Saatchi and Saatchi -- most famous for working with the Conservative Party especially
during the 1979 general election (Maurice and Charles Saatchi later left and set-up M&C
Saatchi)
 TBWAChiatDay -- works with Apple Computer (including the "Think Different"
campaign), adidas, and Sony PlayStation. Responsible for creating the funky brand and
(in the UK) Wonderbra advertising.

Top 10 Advertising Agencies in India
1. Ogilvy and Mather Ltd
Corporate office – New York, USA
Establishment – 1948
Business – Advertising, Marketing
Website – www.ogilvy.com
Ogilvy and Mather is a well-known and among the top Advertising companies in India founded
by David Ogilvy and have offices in more than 150 countries worldwide. Some of the notable ad
campaigns done by Ogilvy and Mather include Cadbury Dairy Milk and Vodafone.
2. GWT Hindustan Thompson Associate’s
corporate office – New York, USA
Business – Advertisement and Marketing
Website – www.jwt.com
One of the oldest advertisement companies in the world, JWT was founded in year 1864. The
company has been operating in more than 90 countries worldwide and taken over Hindustan
Thompson in the year 2002. It is a leading advertisement company in India which has notable
clients such as nestle, Unilever, DTC etc.

3. Rediffusion – DY&R
Corporate office – New Delhi, India
Establishment
Business – Advertisement
Website – www.wpp.com
Rediffusion is a part of WPP group which is rated one among the leading advertising agencies in
India. The company offers various services which
design, social media, promotion and program setups.
4. Mudra Communications Ltd
Corporate office – Ahmadabad, Gujarat
Business – Advertising and Marketing
Website – ddbmudragroup.com
Mudra Communications Ltd. founded in 1980 a Omnicom/DDB Worldwide Group company is a
leading advertising company in India. It has offices in fifteen cities in India. Its clients include
HDFC, Akai, Future Group , Ashok Leyland, Asian Paints, Bata, Cipla, A
NT, KADI
New Delhi, India
India. The company offers various services which include advertisement, consultancy, web
design, social media, promotion and program setups.
Ltd
Ahmadabad, Gujarat
Advertising and Marketing
ddbmudragroup.com
Akai, Future Group , Ashok Leyland, Asian Paints, Bata, Cipla, Aircel& Reebok.
Page39
advertisement, consultancy, web
ircel& Reebok.

5. McCann-Erickson India Ltd
Corporate office – U.S.A
Business – Advertising
Website – mccann.com
a highest ranked company in the advertising agencies in India McCann has offices in 120
countries. McCann has been awarded the Global Agency of the Year by Ad week thrice. Some of
the iconic ads created by McCann Erickson include Coca Cola, MasterCard commercial and
Nescafe.

6. Pressman Advertising and Marketing Ltd
Corporate office – Kolkata, West Bengal
Website – www.pressmanindia.com
Pressman is a well-known name in the advertising industry in India, having presence in many
cities includes Siliguri, Mumbai, Kolkata, Delhi, Chennai, Bhubaneswar, Hyderabad, Bangalore,
Nagpur, Guwahati and Patna. Pressman is India’s ISO 9001:2008 certified agency.
7. FCB-Ulka Advertising Ltd
Corporate office – Mumbai, Maharashtra
Website – www.draftfcbulka.in
FCB-Ulka established in 1961 is consistently maintaining its position in the top 10 Advertising
agencies in India since its inception. FCB-Ulka has its presence in 92 countries having 150
offices across the world.

8. RK Swamy BBDO Advertising Ltd
Corporate office – Mumbai, Maharashtra
Website – www.rkswamybbdo.com
RK Swamy started the advertisement business in year 1973 and became leading brand since
then. The company merged with BBDO and renamed it to RK Swamy BBDO advertising. It
deals with giant MNC’s and national companies and corporate such as Air India, Mercedes-
Benz, Piaggio, Asia motors, Volvoline Cummins etc.

9. Trikaya Grey Advertising (India)
Corporate office – New York, U.S.
Business – Advertising, Entertainment, Marketing
Website – www.grey.com
Grey offers variety of services like advertising, marketing, entertainment, customer relationship
management etc. Based in New York, U.S. Company has offices in 96 countries including India,
Bangladesh, Thailand, Malaysia, Canberra, Korea and more. Company’s clients include
GlaxoSmithKline, Procter & Gamble, Volkswagen and other renowned brands.
10. Chaitra Leo Burnett Pvt Ltd
Corporate office – Chicago, United States
Website – leoburnett.co.in
Rated among the top 10 advertisement agencies in India, Leo Burnett is a Chicago based
advertisement company established in 1998. The company is operating in India from their
regional offices based at Bangalore, Karnataka. It has over 100 offices located in different parts
of the world.
NT, KADI
(India) Ltd
New York, U.S.
sing, Entertainment, Marketing
services like advertising, marketing, entertainment, customer relationship
oSmithKline, Procter & Gamble, Volkswagen and other renowned brands.
Ltd
Chicago, United States
advertisement agencies in India, Leo Burnett is a Chicago based
Page43
services like advertising, marketing, entertainment, customer relationship
advertisement agencies in India, Leo Burnett is a Chicago based

Agency Reckoner
According to the Brand Equity Agency Reckoner 2014 survey and it was conducted by Nielson.
In to this survey Nielson approached professionals with a minimum 5 years of relevant
experiences. The following 4 categories of respondents evaluated different segments of the
survey.
Marketers: Marketing professional across industries such as FMCG, Finance, Consumer
Durables, Automotive, Pharmaceuticals/Healthcare, Telecom, Retail, Hospitality, etc. AD
agency Professionals: Professionals Across Creative, Account Servicing & Planning. Media
Agency Professionals: Client servicing professionals from all sectors. Ailed Marketing
Professionals: Mix of professionals across various verticals such as Digital Specialists, Shopper
Marketers, Promotion, and Event& Design Consultants.

Top 10 AD Agency in India Top 10 Media Agencies
Rank Ad Agency Name
1 Ogilvy And Mather
2 JWT(James Walter
Thompson)
3 Lowe Lint as
4 McCann Erickson
5 Taproot India
6 DDB Mudra
7 Leo Burnett
8 Contract
9 RK Swamy BBDO
10 Rediffussion Y&R
Top 5 Agencies across marketing services
5
5
www.aaai.com
www.davp.org
www.exchange4media.com
Rank Media Agencies
1 Mindshare
2 Madison
3 Initiative/BPN
4 StardomMedia Vest Group
5 Lodestar UM
6 Maxus
7 Media Com
8 Dentsu India
9 OMD
10 Zenith Opt media
DIGITAL
1 Ogilvy One
2 Web Chutney
3 Grey Digital
4 Hungama Digital Services
5 Dentsu Digital
PROMOTION
1 DDB Mudra Max
2 Encompass
3 Candid Marketing
4 Percept Activ
5 Momentum
DESIGN
1 Elephant
2 Fitch
3 Design sutra
4 Ray + Keshvan
5 Red Lion
FILM PRODUCTION
1 Nirvana Films
2 Chrome Pictures
3 Bang Bang Films
4 Equinox Films
5 Ramesh Deo Production

Creative Leaders at India’s top five advertising firms, as per the agency reckoner 2014, pick their
agency’s greatest work. Here are their five all-time-best campaigns.
 1st
Piyush Pandey (Executive Chairman, Ogilvy and Mather India and South Asia)
 Cadbury Dairy Milk
 Vodafone
 Fevicol
 Asian Paints
 Titan
 2nd
Swati Bhattacharya (National creative Director, JWT)
 Maggi
 Pepsi
 2nd
Senthil Kumar (National creative Director, JWT)
 Nike
 The TIMES OF India Chennai and Kerala
 2nd
Tista Sen (National creative Director, JWT)
 Birla Sun life
 3rd
R Balki ( Chairman & Chief creative officer Lowe Lintas)
 Bajaj
 Surf Excel
 Idea
 Tanishq
 4th
Prasoon Joshi (President, South Asia McCann World group)
 Coca-Cola
 Happydent
 Nestle
 The Dabbawala Campaign
 Marico Saffola
 5th
Santosh Pandhi ( Co-Founder, Taproot)
 Pepsi-Change the Game
 Mumbai Mirror- I am Mumbai
 Airtel- Har ek Friend Zaroori Hota Hai
 The Times of India –Aman Ki Asha
 The Times of India- farmer Suicide

Chapter 7
PEST Analysis

 PEST Analysis of Advertising Industry

Political & Legal Factors
 Laws that affect Advertising in India
 Cable Television Network Act
 Drugs and Cosmetics Act
 Drugs Price Control Act,
 Drugs and Magic Remedies (Objectionable Advertisements) Act,
 Emblems and Names (Prevention of Improper Use) Act
 Copyright Act
 Trademarks Act
 Patents Act – Introduction to Intellectual Property Right
 Indecent Representation of Women (Prohibition) Act
1. Cable Television Network Act
No Advertisement Which Violates The Code For Self- Regulation In Advertising As Adopted
By The Code By The Advertising Standards Council Of India (ASCI), Mumbai Of Public
Exhibition In India, From Time To Time, Shall Be Carried In The Cable Service. No
Advertisement Shall Be Permitted Which;
 Derides any race, caste, color, creed and nationality;
 Is against any provision of the constitution of India;
 Tends to incite people to crime, cause disorder or violence, or breach of law or glorifies
violence or obscenity in any way;
 Presents criminality as desirable;
 Exploits the national emblem, or any part of the constitution or the person or personality
of the national leader or a state dignitary;
No advertisement shall be permitted;
 This projects a derogatory image of women.
 Women must not be portrayed in a manner that emphasizes passive, submissive qualities
and encourages them to play a subordinate, secondary role in the family and society.

 Portrayal of the female form, should be tasteful and aesthetic, and within the well-
established norms of good taste and decency;
 Exploits social evils like dowry, child marriage;
 Promotes directly or indirectly production , sale or consumption of Cigarettes, tobacco
products, wine, alcohol, liquor or other intoxicants;
 Provided that a product that uses a Brand name or Logowhich is also used for cigarettes,
tobacco products, wine,alcohol, liquor or other intoxicants, may be advertised oncable
service subject to the following conditions that
 The story board or visual of the advertisement must depict onlythe product being
advertised and not the prohibited products inany form or manner;
2. Drug and Commission Act 1940
The Act regulates the import into, manufacture distribution and sale of drugs and cosmetic in the
country. The Act was amended to impose more strict penalties for manufacture and sale of
adulterated or spurious drugs or drugs not of standard quality which are likely to cause death or
grievances hurt to the userCosmetics included toilet soap as it may contain harmful ingredients.
The competent gelatin was induced in the drug. Patent and proprietary medicines included
Ayurveda, Siddha or Unani systems of medicines. The Central Government is empowered to
prohibit import of manufacture of drugs and cosmetics if it is harmful to humans as well as
animalsany person with license has to maintain records and other documents and to produce
them when required. Inspectors are empowered to stop and search any vehicias carrying drugs &
cosmetics if an offence under the Act is being committed enhancement of the quantum of
punishment for offences under the Act. The Technical Advisory Board will have representatives
or experts in Ayurvedic, Siddha and Unani systems of medicine.
3. The Drug & Magic Remedies (Objectionable Advertisement) Act 1954
This is an act to control the advertisement of drugs in certain cases, to prohibit the advertisement
for certain purposes of remedies alleged to possess magic qualities and to provide for matters
connected herewith According to the Act “Magic Remedy” includes a talisman mantra, kavacha
and any other charm of any kind which is alleged to possess miraculous powers for or in the
diagnosis, cure mitigation, treatment or prevention of any disease in human beings or animals

The legislation enacted by the center, was under the entry “Drugs and Poisons” and “Legal,
Medical and other Professions” in the concurrent list
 Subject to the provisions of this Act, no person shall take part in the publication of any
advertisement relating to a drug if the advertisement contains any matter which: Directly
or indirectly gives a false impression regarding the true character of the drug Makes a
false claim for the drug Is otherwise false or misleading in any particulars
 No person shall take any part in the publication of any advertisement referring to any
drugs in terms which suggest or are calculated to lead to the use of that drug for:The
miscarriage in women or prevention of conception in women The maintenance or
improvement of the capacity of human being for sexual pleasures The correction of
menstrual disorder in women The diagnosis, cure mitigation, treatment or prevention of
any disease, disorder or condition specified in the schedule or which is specified in the
rules
4. Drugs (Price Control) Order 1995
The order was passed so that the government may regulate the equitable distribution and
increasing supplies of a bulk drug specified in the first schedule and make it available at a fair
price and specify a maximum sale price at which such bulk shall be sold If the manufacturer
desires a revision of the maximum sale price and application may be made to the government
 The manufacturer has o give details of all scheduled drugs along with the cost of such
bulk drugs
 The government can by this order, direct manufacturers to sell to other manufacturer of
formulations of it deems necessary
 The government had the power to fix the retail price of a scheduled formulation. This
fixed price cannot be increased by any manufacturer

5. The Emblems and Names (Prevention of Improper Use) Act 1950
This is an act to prevent the improper use of certain emblems and names for commercial and
professional purposes. It extends to the whole of India and also applies to citizens of Indian
living outside India. The name, emblem or official seal of the following organizations cannot be
used:
 United Nations, World Health Organization, The Indian Flag, The Government of India
or any of its departments, The State Government, The President, Governor, UNESCO,
The International Civil Aviation Organization, World Metrological Organization,
International Atomic Energy Agency.
 The name of pictorial representation of Rashtrapati Bhava, Raj Bhavan, Chhatrapati
Shivaji Maharaj or Mahatma Gandhi, Jawaharlal Nehru, Srimati Indira Gandhi or the
Prime Minister of India.
 The name of Ashoka Chakra and Dharma Chara or the pictorial representation of Ashoka
Chakra as used in the Indian Nat5ional Flag, the name of parliamenet or legislature of
any state, the supreme court, High Court, The Central Secretariat.
 The name and emblem of The Rama Krishna Math and Mission, Sri Sarada Math and
The Rama Krishna Sarda Mission, The Bharat Scouts and Guides with its emblem, the
name and emblem of the International Olympic Committee, The National Youth
Emblem, The emblem of St. John Ambulance Association (India) and St. John
Ambulance Brigade (India)
6. Copyright act,1957
It introduced several new features which are briefly indicated below:
 A Copyright Officer is sought to be established under the immediate control of a
Registrar of Copyrights who shall act under the superintendence and direction of the
Central Government. The principal function of the Copyright Office will be to maintain
Register of Copyrights in which may be entered, at the option of being and other relevant
particulars. Such a Register will easily make available useful information to interested
members of public in regard to copyrighted works.

 An author assigning copyright in his work is allowed the option to re-acquire the
copyright after seven years but before ten years of the assignment on the condition that he
returns the amount received by him at the time of the assignment with interest thereon.
 The normal of the copyright is fixed to be the life of the author and a period of 25 years
after his death as against the existing term of the life of the author, and a period of 50
years after his death. Shorter terms are fixed for anonymous or pseudonymous works,
cinematograph films, mechanical contrivances, photographs, etc
7. The Trademarks Act 1999
The Trade and Merchandise Marks Act, 1958
It had served its purpose and review of the existing law was necessary because of developments
in trading and commercial practices, increasing globalization of trade and industry, etc a need for
simplification and harmonization of trademark and to give effect to important judicial decision.
Hence the Trademark Act, 1999 incorporated the following
The registration of trademarks for services in addition to goods. Registration of trademarks
which are limitation of well-known trademarks not to be permitted. Simplified procedure for
registration with equal rights. Enhancing punishment for the offences relating to trade marks.
Appointing and Appellate Board for speedy disposal of appeals. The final authority for
registration of certification trademarks to the Registrar instead of the Central Government.
8. The Patents Act 1970
It extends to the whole of India. Person who can apply for patents;
 Is the first inventor of the invention?
 Is any person being an assignee of the person who claims to be the first invention?
 Is any representative of any deceased person who immediately, before his death was
entitled to make such an application?
Application has to be for one invention only and has to be made in the prescribed form and filed
in the patent office. When a provisional application is made, a complete specification has to be
filed within 12 months otherwise the application is deemed to be abandoned. Every International

application under the Patent Co -operation Treaty for a patent may be filed designating India
only if a corresponding application has also to be filed before the Controlle6
r in India. The date
of filling in both the places has to be same.
9. The Indecent Representation of Women (Prohibition) Act 1986
It extends to the whole of India, except the State of Jammu and Kashmir. No person shall publish
or cause to be published, or arrange to take part in the publication or exhibition of any ad which
contains indecent representation of women in any form; Prohibition of publication or sending by
post of books, pamphlets, slide, films, drawing; photographs, etc containing indecent
representation of women. Under the Indecent Representation of Women (prohibition) Act,
“Indecent representation of women by the way of depiction of the figure of a woman, her form of
body, or any part thereof to have the effect of being indecent, or derogatory to, or denigrating
women, or is likely to deprave, corrupt or injure the public morality or morals.”
The act will not apply of the prohibition is proved to be justified on the grounds that such book,
pamphlet, etc is in the interest of science, literature, art or learning. Any representation
sculptured, painted or otherwise represented on or in: Ancient monument any temple of any car
used in the conveyance of idols or kept or used for religious purpose
6
http://www.ascionline.org/
http://www.ascionline.org/index.php/laws-governing-ads.html

Economic Factors
1. Effect on the Value of Products
Why do most people prefer branded products? Are the advertised products functionally better?
Not necessarily. But, in the mind of the consumer, advertising has given these brands added
value.
One advantage of the free-market system is that consumers can choose the values they want in
the products they buy. If, for example, low price is important, they can buy an inexpensive
economy car. If status and luxury are important, they can buy a fancy sedan or racy sports car.
Many of our wants are emotional, social, or psychological rather than functional. One way we
communicate who we are (or want to be) is through the products we purchase and display. By
associating the product with some desirable image, advertising offers people the opportunity to
satisfy those psychic or symbolic wants and needs.
In terms of our economic framework, by adding value to products, advertising contributes to
self-interest—for both the consumer and the advertiser. It also contributes to the number of
sellers. That increases competition, which also serves the consumer’s self-interest.
2. Effect on Prices
Some advertised products do cost more than unadvertised products, but the opposite is also true.
Both the
Federal Trade Commission and the Supreme Court have ruled that, by encouraging competition,
advertising has the effect of keeping prices down. That again serves the consumer’s self-interest.
And that is why professionals such as attorneys and physicians are now allowed to advertise.
Sweeping statements about advertising’s positive or negative effect on prices are likely to be too
simplistic. We can make some important points, though:
 As one of the many costs of doing business, advertising is indeed paid for by the
consumer who buys the product. Inmost product categories, though, the amount spent on
advertising is usually very small compared with the total cost of the product.

 Advertising is one element of the mass-distribution system that enables many
manufacturers to engage in mass production, which in turn lowers the unit cost of
products. These savings can then be passed on to consumers in the form of lower prices.
In this indirect way, advertising helps lower prices.
 In industries subject to government price regulation (agriculture, utilities), advertising has
historically had no effect on prices. In the 1980s, though, the government deregulated
many of these industries in an effort to restore free-market pressures on prices. In these
cases, advertising has affected price—usually downward, but not always.
 In retailing, price is a prominent element in many ads, so advertising tends to hold prices
down. On the other hand,national manufacturers use advertising to stress features that
make their brands better; in these cases advertising tends tosupport higher prices for their
brands.
3. Effect of Competition
Some observers believe advertising actually restricts competition because small companies or
industry newcomers can’t compete with the immense advertising budgets of large firms.
 It’s true that intense competition does tend to reduce the number of businesses in an
industry. However, some of the firms eliminated by competition may be those that served
customers least effectively. In other cases, competition is reduced because of mergers and
acquisitions (big companies working in their own self-interest).
 High costs may inhibit the entry of new competitors in industries that spend heavily on
advertising. In some markets, the original brands probably benefit greatly from this
barrier. However, the investments needed for plants, machinery, and labor are of far
greater significance. These are typically the real barriers to entry, not advertising.
 Advertising by big companies often has only a limited effect on small businesses because
a single advertiser is rarely large enough to dominate the whole country. Regional oil
companies, for example, compete very successfully with national oil companies on the

local level. In fact, the freedom to advertise encourages more sellers to enter the market.
And we’ve all seen non-advertised store brands of food compete very effectively with
nationally advertised brands on the same grocery shelves.
4. Effect on Consumer Demand
The question of advertising’s effect on total consumer demand is extremely complex. Numerous
studies show that promotional activity does affect aggregate consumption, but they disagree as to
the extent. Many social and economic forces, including technological advances, the population’s
educational level, increases in population and income, and revolutionary changes in lifestyle, are
more significant.
Advertising can help get new products off the ground by giving more people more “complete
information,” thereby stimulating primary demand—demand for the entire product class. In
declining markets, when the only information people want is price information, advertising can
influence selective demand—demand for a particular brand. But the only effect it will have on
primary demand is to slow the rate of decline. In growing markets, advertisers generally compete
for shares of that growth. In mature, static, or declining markets, they compete for each other’s
shares.
5. Effect on Consumer Choice
For manufacturers, the best way to beat the competition is to make their product different. For
example, look at the long list of car models, sizes, colors, and features designed to attract
different buyers. And grocery shelves may carry more than 100 different brands of breakfast
cereals—something for everybody. The freedom to advertise encourages businesses to create
new brands and improve old ones. When one brand reaches market dominance, smaller brands
may disappear for a time. But the moment a better product comes along and is advertised
skillfully, the dominant brand loses out to the newer, better product. Once again, the freedom to
advertise promotes the existence of more sellers, and that gives consumers wider choices.

6. Effect on the Business Cycle
Historically, when business cycles dip, companies cut advertising expenditures. That may help
short-term profits, but studies prove that businesses that continue to invest in advertising during a
recession are better able to protect, and sometimes build, market shares. However, no study has
shown that if everybody just keeps advertising, the recessionary cycle will turn around. We
conclude that when business cycles are up, advertising contributes to the increase. When
business cycles are down, advertising may act as a stabilizing force by encouraging more buyers
to buy.

Social Factors
Because it’s so visible, advertising gets criticized frequently, for both what it is and what it isn’t.
Many of the criticisms focus on the style of advertising, saying it’s deceptive or manipulative.
Collectively we might refer to these as short-term manipulative arguments. Other criticisms
focus on the social or environmental impact of advertising. These are long-term macro
arguments.
The social aspect of advertising typically involves the two principles: complete information and
absence of externalities. In fact, social issue debates can be seen as instances where advertising
tends to violate one or more of these basic economic principles. We can examine many issues
from these two perspectives. Some of the most important are deception and manipulation in
advertising, the effect of advertising on our value system, commercial clutter, stereotypes, and
offensiveness. Let’s look at some of these common criticisms of advertising, debunk some
misconceptions, and examine the problems that do exist.
1. Deception in Advertising
One of the most common short-term arguments about advertising is that it is so frequently
deceptive.
For advertising to be effective, consumers must have confidence in it. So any kind of deception
not only detracts from the complete information principle of free enterprise but also risks being
self-defeating. Even meaningless (but legal) puffery might be taken literally and therefore
become deceptive. Puffery refers to exaggerated, subjective claims that can’t be proven true or
false, such as “the best,” “premier,” or “the only way to fly.”
Under current advertising law, the only product claims—explicit or implied—that are considered
deceptive are those that are factually false or convey a false impression and therefore have the
potential to deceive or mislead reasonable people. But puffery is excluded from this requirement
because regulators maintain that reasonable people don’t believe it anyway. Preston points out
that since advertisers regularly use puffery and non - product facts to enhance the image of their

products, they must think consumers do believe it. Non – product facts are not about the brand
but about the consumer or the social context in which the consumer uses the brand.
The fact is that advertising, by its very nature, is not complete information. It is biased in favor
of the advertiser and the brand. People expect advertisers to be proud of their products and
probably don’t mind if they puff them a little. But when advertisers cross the line between
simply giving their point of view and creating false expectations, that’s when people begin to
object. One problem is the difficulty of seeing the line, which may be drawn differently by
different people.
2. The Subliminal Advertising Myth
Advertising that uses images and sounds that the conscious mind is not aware of, in order to
influence people and make them attracted to a product. By embedding dirty words in the ice
cubes in a liquor ad, for instance, advertisers can somehow make us want to buy the product.
Advertisers are messing with our heads—manipulating us psychologically, and without our
consent, into buying things we don’t want or need. This gets to the heart of the complete
information principle because the criticism suggests that advertising does not give
consumers information upon which to base rational decisions, but rather manipulates us through
brainwashing. Consumers are, therefore, like captured prey, helpless in the jaws of marketing
predators.
3. The Use of Stereotypes in Advertising
Advertising has long been criticized for insensitivity to minorities, women, immigrants, the
disabled, the elderly, and a myriad of other groups—that is, for not being “politically correct.”
This long-term argument also addresses externalities because the very presence of advertising
affects the nature of our culture and environment, even when we do not want it. This is ironic,
because marketing and advertising practitioners are supposed to be professional students of the

communication process and consumer behavior. But, in fact, they sometimes lose touch with the
very people they’re trying to reach.
However, problems still exist, especially in local and regional advertising and in certain product
categories such as beer and sports promotions. Many advertisers are just not aware of the
externalities that their ads can create, and they may perpetuate male and female stereotypes
without even realizing it. Other advertisers resort to stereotypes for convenience. All too often,
women are still not represented accurately. And the minimal use of minorities in mainstream ads,
both local and national, still smacks of tokenism. Observers hope that with increasing numbers of
women and minorities joining the ranks of marketing and advertising professionals, and with
continuing academic studies of minority and sex-role stereotyping, greater attention will be
focused on these issues.
4. Offensiveness in Advertising
Today, grooming, fashion, and personal hygiene products often use partial nudity in their ads. Where
nudity is relevant to the product, people are less likely to regard it as obscene or offensive—except, as in
the case of Abercrombie & Fitch, when the advertising is targeting kids. In many European countries, in
fact, nudity in commercials is commonplace. Even the usually staid Brits are starting to see women’s
breasts in TV commercials and posters.36 Some industry observers predict that nudity in U.S. advertising
will increase in the twenty-first century but there will be fewer overt sexual scenes of the Abercrombie &
Fitch style. Some consumers get so offended by both advertising and TV programming that they boycott
sponsors’ products. Of course, they also have the option to just change the channel. Both of these are
effective strategies for consumers because, ultimately, the marketplace has veto power.7
7
http://www.aef.com/pdf/arens_ch03.pdf

Technological Factors
 Technology has always played an important role in the advertising and communication
aspects of business. It has provided businesses with a means to communicate with their
customers and target market. From the history of business, advertising has been hand in
hand with business. Various strategies have been used by business men to market their
businesses, products and services. Advertisement began with the word of mouth as a
media; they walked from door to door talking about their goods. Businessmen and
women moved from town to town, across states and landscapes to sell their products.
They relied heavily on their customers to market their products by talking about the
products to family, friends and acquaintances. Though this strategy is in use today,
especially with the sales representatives it is a tradition that is slowly dying out. From the
age of 'the word of mouth' we moved to the print media, then the most widely used form
of advertising was the newspaper, the moment man learnt to print, he used this medium
to promote his causes and products. Apart from news the newspaper has been a key
advertising tool, which is still in use today. Other forms of print advertising media that
have been in use are magazines, posters, signs and billboards. These used pictures to
stimulate the visual sense, they were attractive to look at, and hence they appealed to a
wide audience (Krewen, 2010).
 For audio media the radio has been an effective advertising tool, the attraction in radio
was the use of sound to promote products, the moment radio came into the market it was
used for news, entertainment and advertising. The advertisements in radio used music to
capture the audience; in the process they found it to be a good sensory stimulator. With
the advent of radio, came the television which beat all forms of advertising, because it
combined visual and audio. Television advertisements were and still are attractive; the
competition between the companies was to realize the best advertisement that would awe
the crowd. For many decades the these media were used to advertise, the catch in the
advertisement industry was the production of the best and most catching slogan and
advertisement that would not be forgotten and would be the talk in the market. All
businesses and industries realized the importance of advertisements and hence in the

process advertising became a discipline on its own. The competition to produce the best
advertisement was seen in both the marketing departments of organizations and the
advertisement agencies. Advertisements, they realized required creativity and
entrepreneurship, the coming up with original advertisements is seen as paramount in the
advertisement and communication industry. Those who have made for themselves a good
name in the advertisement industry, are seriously sort and consulted in the making of
advertisements.
 There exists advertising agencies that compete in the advertisement sector, the realization
that proper communication with clients and potential clients is very important. These
agencies have embarked on the advertisement industry, where the business of advertising
has become very profitable. Hungry markets are demanding for creativity and ingenuity,
but few agencies have enough talent and entrepreneurship to make it. Most advertising
agencies have no aspiration, nor are they ready to change, what they are plagued with is
executives who are conservative and are not ready to leave their comfort zone. Then there
is a crop of advertising agencies that are very aggressive, they are progressive and try to
continually find ways to meet their customers' needs (Frank, 2007).
 The reason that technology has greatly affected advertising and communication is the fact
that it is widely used today. Since advertising entails the communication of a message by
a business to its clients and potential clients, the mode of communication in the market
determines greatly the media used to advertise. Technology has overtaken the world by
storm; the modes of communication have changed as a result. This means that any
advertisement agencies has to comply with the market rules, they need to follow the
changing trends. Those that are still stuck in time are finding it hard to cope. From the
conservative advertisement media; television, radio, print media, to the technological era
characterized by; mobile phones, internet, digital television, DVR, smart phones, social
networks. The reason for the use of these technologies is the fact that they are the leading
sources of entertainment today. The leading market researchers predict that a continued
growth of the digital world. The fact that the consumer greatly influences brands in the
digital market is an important factor, according to Forrester research, 31% of the market

A Comprehensive Project report on Indian Advertising Industry

A Comprehensive Project report on Indian Advertising Industry

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A Comprehensive Project report on Indian Advertising Industry