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Effective media of advertisement for 201

F.M.C.G 1

A
RESEARCH REPORT
ON

EFFECTIVE MEDIA OF ADVERTISEMENT


FOR F.M.C.G
SUBMITTED IN PARTIAL FULFILNENT FOR THE AWARD
OF DEGREE OF
MASTER OF BUSINESS ADMINISTRATION
(G.B. TECHNICAL UNIVERSITY, LUCKNOW)

2010-11

Submitted To: Submitted By:

Mr.RajendraSharma purnendra Srivastava

Assistant Professor MBA IVth, SEM

J.D.I.M.T

JEEVANDEEP INSTITUTE OF MANAGEMENT AND


TECHNOLOGY
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INDEX
TITLE

1. ACKNOWLEDGEMENT
2. DECLARATION
3. PREFACE
4. EXECUTIVE SUMMARY
5. INTRODUCTION OF THE PROJECT
6. OBJECTIVE OF THE PROJECT
7. SCOPE OF THE PROJECT
8. USE OF THE PROJECT
9. ADVERTISEMENT –AN INTRODUCTION
10. CHANGING PARADIGM OF ADVERTISMENT
11. MEDIUMS OF ADVERTISMENT
12. FACTORS AFFECTING THE EFFECTIVENESS OF A MEDIA
13. FACTORS AFFECTING THE MEDIA USE
14. ISSUES IN ADVERTISING
15. RESEARCH METHODOLOGY
16. CHARACTERISTICS OF GOOD RESEARCH METHODOLOGY
17. RESEARCH FINDINGS
18. CONCLUSION
19. RECOMMENDATION
20. LIMITATIONS
21. BIBLIOGRAPHY
22. ANNEXURE
23. QUESTIONNAIRE
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ACKNOWLEDGEMENT
This Research Report is an outcome of the colossal support and encouragement provided
by a number of people at my Institute and outside.

I would like to acknowledge with extreme gratitude, the unfailing wise counsel,
intellectual and moral support extended to me esteemed honorable Sir Mr. Rajendra
Sharma, Assistant Professor, J.D.I.M.T, Varanasi, His indispensable suggestions have
led to the successful culmination of the work and completion in the form present Report
and chance to learn.

Word have never seemed so inadequate as now, when I am endeavoring to express my


deepest sense of thankfulness to Mr. Ambrish Singh Sir Vice Chairman J.D.I.M.T,
Varanasi, without his valuable guidance, support and encouragement it would have been
impossible for me to accomplish this work. It was mainly because of him that the work is
presented coherently and its purpose shines through.

I would like to pay my humble regard and thanks to my entire respected librarian and all
those who directly or indirectly rendered their help in completing this research project
report.

I also like to present a deep bow of gratitude to my family and friends who have been of
great directly and indirectly.

(PURNENDRA SRIVASTAVA)
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DECLARATION

I NEERAJ SRIVASTAVA student of master of Business Administration from


JEEVANDEEP INSTITUTE OF MANAGEMENT AND TECHNOLOGY,
VARANASI Hereby declare that all information and facts in this research report are my
findings and original in nature, which are collected from various sources.
The same has been never submitted by the under signed either in part or in full to any
institution.
This information is true to the best of my knowledge.

Date:

Place: (PURNENDRA SRIVASTAVA)


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PREFACE
In less than a decade, the Indian advertising environment has changed almost beyond
recognition. The old certainties are dead. The fixed 15% commission is on its way out,
being replaced with a fee-based compensation system tied to actual performance. With
growing media fragmentation, rising costs per contact and emergence of new media like
the internet, companies are no longer prepared to invest in traditional advertising without
R.O.I. with brand and product competition heightening, the consumer is being bombard
with thousands of message daily, making the advertiser’s task of making a connection that
much more difficult.

World-wide, and increasingly in India, marketers have realized that they have to try and
reach the consumer in different ways, not only by advertising but with different aspects
like-wise quality of the product, quantity of the product and appropriate time. The
buzzword is precision targeting of customers, and advertising, with its one-size-fits-all
message, lead to a lot of spending wastage in products aimed at niche audience.

Even the traditional mass market brands daily use FMCG products like chocolates,
biscuits and many more begun to look at advertising as only one element of the marketing
communication mix. With product differentiation narrowing, FMCG companies are
weighting the pros and cons of increasing advertising spend against investments in
product innovation, sales promotion and strengthening distribution networks.

In the scenario, advertising agencies are going through a tough process of introspection
and change. At one level, they are slimming down to become leaner and meaner. With
media planning and buying being spun out of many top notch agencies as separate
activities, the core brand agency is getting more sharply focused on delivering client value
by becoming more creative and versatile. This has necessitated a delivering of the creative
and client serving functions, with the old multi-layered structure flattened to more
manageable three or four-tier structures. Simultaneously, agencies are stressing
multimedia creative skills, and just print or T.V communication. The new creative terms
thus tend to be more versatile, with the ability to create effective communication across
various media ranging from print to T.V, internet, outdoors, direct marketing and event
sponsorship.
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Consumers don’t experience media in a vacuum. Many research studies are establishing
the fact that at any one time half, the people watching T.V will be opening their mail,
surfing the web, or listening to the radio. Yet media planners for the most part continue to
plan in isolation, considering each medium as a separate element of a campaign, rather
than binding them together. While synergy certainly makes sense, there hasn’t been much
data to argue that it produced measurably better results. Well, now there is, and it relates
to synergies between television and internet.

According to a study done by New York based research firm Dynamic Logic, adding
online advertising to a T.V campaign boosts brand awareness, but the inclusion done little
to impact purchasing decisions.

The firm examined 10 cross media studies in which T.V and online advertising and found
that the web is a particular effective medium for reinforcing a brand’s sponsorship of an
event, cause or other entity. When respondents were exposed to internet ads, sponsorship
association increased nearly 16 points, more than doubling T.V’s impact.

“The most interesting fact is that we are actually able to conduct these types of cross-
media studies.” says dynamic logic vice president of research analyst Bill Havlena.

“It means that the metrics-both brand and persuasion metrics, such as purchase intent and
brand awareness are comparable for both T.V and online, as opposed to online-only
measurements such as click-through,” the ad’s.

Dynamic logic evaluated five criteria namely aided brand awareness, message association
sponsorship association, brand favorability and purchase intent/consideration were
evaluated in 10 cross media campaigns over the past two years. The study found that
sponsorship and message association are most affected by television advertising,
compared to the baseline of individuals who are not exposed to any advertising.

At the point of retailers shop the most effective and inclusive medium of advertisement is
the product dispenser and the P.O.P, stands and pamphlets by which the customers as well
as the visitors can see the name of the product and make them aware about the product/
services.

Television advertising increases sponsorship association 12.7% over the baseline and
improve message association by 12.5%. Both measurements were also the most affected
by the addition of an online campaign. Sponsorship association increased to 28.4% over
the baseline with online activity, and message association grew to 19.9%.
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The only criterion that did not improve significantly with the addition of online effects is
purchase intent/consideration, which showed 5.0% improvement with television but only
an addition 0.4% improvement with incremental online efforts.

While the results of the analysis of the 10 campaigns aren’t conclusive, Havlena says they
give directional insight into the value of television and internet working together.

“Advertisers are interested in becoming mere synergistic. They are producing ads that
complement each other across various media types in a comparable way’s”

Carton Donofrio partners chief experience officer Sean Carton says multimedia efforts
aren’t just a futuristic trend but integral to current strategies. “Synergy isn’t the way
things are going. It’s the way things are right now. Being at every point where a customer
can tough your company is vital and obvious for anyone who wants to have the most
effective strategy. It makes media sense. More people who see the message in whatever
medium means more awareness. He says part of the reason the internet is not being better
utilized by advertisers has to do with media planners, measurements and standards.

According to carton the cultural differences between traditional media planners and online
media planners have yet in many agencies. In addition, measurement tools for serving and
tracking buys tend to be cost-prohibitive for many small and mid-sized shops.

“Also, online suffers from lack of standards. At this point, the IAB (Interactive
advertising Bureau), AAAA (American Association of Advertising Agencies) and MRC
(Media Rating Council) still haven’t arrived at a standard for what counts as an
impression- pretty basic stuff. They’re working on it, but until the standard is agreed to by
all the players, adoption of online is still going to lag.”
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EXECUTIVE SUMMARY

Title of the Research: Effective Media of Advertisement for FMCG

Research Duration : One Month.

Area of Coverage : Varanasi

Sample Size : 100


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Marketing is becoming a
battle more on information
than on sales power.
Philip Kotler.*

Marketing Management
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Page no-122

INTRODUCTION OF THE PROJECT

This project is a research work undertaken to find out the most effective medium of
advertisement for FMCG and the role of promotion. (Fast moving consumer goods). This
is the study of Varanasi division. FMCG has very wide varieties of product of different
type. Each and every product has a very vast line and width. Everyday so many new
products are launched. There are so many mediums of advertisement, which is explained
in detailed.

This project is to search out the most effective medium of advertisement from different-
different mediums. Most effective in the sense that the medium from where people get to
know about a new product or existing one most of the time.

Customer as well as the retailers both are the one who has to interact with each other daily
and the product /service is provided by the retailer to the customer is some time depend
upon the goodwill with the customer at the point the advertisement and the banner plays a
big role to maintain the relationship between the customer and the retailer so while in
FMCG product most of the time the customer is already aware about the product by adds
on TV and on newspaper. Here the profit is to gain maximum attraction of the customer
towards the product and services provided by the company and it depends upon the
advertisement medium and the present ability style of the product in the market.
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SCOPE OF THE RESEARCH

1. Finding out the most effective media of advertisement.


2. Effect of advertisement in consumer buying behavior.
3. Role of advertisement consumer decision making.
4. Study of advertisement as a promotional tool.
5. Comparative and cost effective media vehicle.
6. Importance of advertising in consumer awareness.
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USE OF THE PROJECT


Research use can be studied in following two categories.

USE OF THE PROJECT FOR MARKETER-


1. Deciding most effective media of advertisement.

2. Cost effective media selection.

3. Understanding consumer behavior.

4. Consumer decision making.

5. Study of consumer buying behavior.

6. Sales promotion through advertisement.

7. Advertisement in brand building and product positioning.

USE OF PROJECT FOR CONSUMER-


1. Help consumer in decision making.

2. Useful in product choice.

3. Product and brand awareness.

4. Low price product choice.


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The best advertising is


done by satisfied
customer.
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Philip Kotler.*

Marketing Management

Page no-589

ADVERTISMENT – AN INTRODUCTION

Advertising is a paid form of non-personal communication or presentation and promotion


of ideas, goods, or services by an identified sponsor. Advertiser include not only the
business firms, but also museums, charitable organizations, as well as government
agencies that direct messages to target publics.

Organizations handle advertising in different ways. In small companies, advertising is


handled by someone in the sales or marketing department, who works with advertising
agencies. A large company will often set up its own department.

According to the new encyclopedia Britanica,” Advertising is a form of communication


intended to promote the sale of the product or service to influence public opinion, to gain
political support or to advance a particular cause.”
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FEATURES OF ADVERTISING-

1. Advertising is paid if not paid it become propaganda.

2. It is a form of communication, presentation, or promotion.

3. Advertising is non-personal.

4. There were identified sponsors.

5. It is a persuasive act.

Money
Message
Factors to consider:
1. Message
 Stage in generatio
PLC. n.
Media
Mission  Market 2. Message
1. Reach
evaluatio
share.
Sales Goal frequenc
n. Measuremen
 Competition. y,
Advertising impact.
t
Objective  Advertising
Frequency. 2. Major  Commun
media ication
 Product type. impact.

3. Specific  Sales
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Role of Advertising.
I. Communication with consumers.

II. Persuasion.

III. Contribution to Economic growth.

IV. Catalyst for change.

Objective of Advertising.
I. Introduce new product.

II. Sustain the establish product.

III. Help middle men.

IV. Increase the target group.


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V. Increase the public welfare.

Types of Advertising.

1. According to Geographical spread:


a. National Advertising.
b. Local Advertising.
c. Global Advertising.

2. According to Target Group:


a. Consumer Advertising.
b. Industrial Advertising.
c. Trade Advertising.
d. Professional Advertising.

3. Advertising based on demand influence level:


a. Primary Demand.
b. Selective Demand.
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4. Institutional or Product Advertising:
a. Institutional Advertising.
b. Product Advertising.

5. Timing of Response it Effects:


a. Direct action Advertising.
b. Indirect action Advertising.

Changing Paradigms of Advertising.

Ever since its inception, the internet and world wide web have been constantly spawning
new rules and vocabulary for the marketplace in the virtual sphere. Through the basic
principles of marketing like utilizing all possible channels of contact to earn consumer
attention remain the same, the approach to achieving these ends has changed a bit.
Businesses have also caught on to the marketing possibilities of the internet early, and
now internet advertising is big business.
With the popularity of ‘PLASTIC MONEY’ and the advert of secure online payment
gateways, the e-commerce revolution has finally taken off. Nowadays, many of us
routinely buy products from internet websites. It’s easy and convenient and often we can
get better prices than at our local store. Naturally, businesses are now take trying to
advantage of the internet and market their products effectively online.

Internet advertising is now slowly emerging from the shadows of traditional advertising.
Through both these forms of media have a common platform, their approach and
perspective is entirely different when it comes to the kind of medium that is involved.
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Recognizing this development, many traditional advertising and offer specialized
campaign designed specifically for web based businesses.

Internet advertising combines aspects of both traditional mass media advertising with
more personal one on one type selling. It is most effective when it prepare an online
advertising strategy that combines both elements. Internet advertising can include things
such as e-mail campaigns, banner ads, pop-up ads, etc. there are variations to each of
these elements. For example there are different types of banner such as static banner,
animated banner or interactive banner.
A rich media banner allows consumers to have more interaction, such as playing games.
The other various types of internet advertising include search engines web advertising,
pop-up under advertising, banner exchange advertising, online directory, yellow pages.
And link exchange advertising.

Vocabulary of Internet Advertising.


A brand new vocabulary and terminology of internet have emerged on which all online
advertising initiatives are based. The most critical components of this vocabulary are:
 CTR (click through ratio/rate)
It is the most common form of measuring the success of an advertising campaign
on the internet. CTR is the percentage of the ad view that results in an ad click.
 Ad view or ad impression is the number of times a visitor downloads or views an
ad banner.
 The conversion rate is equivalent to a completed sale or other online action taken
by user after a click through.

 Cost per Thousand (CPM)


It is amount of expenditure incurred to receive a thousand impressions.

Most CPM’s can range from $25 to $60.

 Cost Per Click


Another form of measuring advertising spends. CPC’s are what businesses pay
for every individual who clicks on the Ad this is generally favorable for the
business buying the ad, because they don’t pay unless there is action taken. This
is becoming more popular as return on advertising investment is critical.
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Cost per click (CPC) = CPM/ (CTR * 1000) for example, if you paid $15 CPM
for a banner with a 2.5% CTR, the CPR, the CPC will be 15/2.5*1000 =0.006

 Cost Per Visitor (CPM)


It is the cost of advertising for every visitor the website

 Cost Per Sale (CPS)


It is the amount of ad money a company pays per sale.

 Impression
A measure of how many times a banner is displayed. Each time the banner is
shown is counted as one impression.

 Page view
A measure of how many times a complete page is displayed. It is one page view
each time a page displayed.

 Banner views
Similar to page views, banner views track the number of times a banner has been
viewed.

 Run of site (ROS)


Run of site advertising is less expensive than more targeted advertising methods.
ROS refers to displaying a banner ad throughout a website or a banner network
but without the targeting; in other word, the ad displays on a variety of sites
without a target audience in mind.

 Banner Exchange

It is a system where websites exchange banner advertisements on a reciprocal


basis and mutually benefit each other.

Website advertising can make or break an internet business. Website advertising may
include things like banner ads, e-mail campaigns, and pop-up ads. Each of these different
devices caters to different needs of businesses. All he factor defined above play an
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important role in determining the kind of advertising an advertiser should engage in, as
the success of that advertising effort will depend on the choice made.
A certain amount of ‘free’ website advertising can also be done through word of mouth.
Writing articles, and posting blogs about your particular business. Putting your website as
a link on as many other websites that are related to your company or industry is also a
good option.

The most conventional of all kinds of internet advertising remains banner advertisement
followed by Rich Media advertisements. Rich Media ads refer to multimedia advertising
on the websites.
They differ from banner ads in the sense that they do not guide a website-visitor to
another website; instead the entire message without leaving the website displaying the
advertisement. These kinds of ads came much later than banner ads mainly as an
enhancement technique to spice up the ads and make them more attractive initially, java
applets were used to create rich media ads but were later replaced with faster, compact
and simpler software programs like flash and director developed by macromedia.

However, ever with advert of so many types of advertising, banner ads still are the most
popular choice of the advertisers right from the year 1994, when they first came into
being. They started with click through rates as high as 25% but now these rates have
fallen drastically over the years due to a phenomenon often referred to as ‘banner fatigue’
i.e. so many banners being presented to the people rate is just about a fraction of a
percentage but they are still going strong when compared to the other kinds of online
advertisements.
A banner advertisement typically consists of a banner (graphic image) and a link
displayed on a high traffic website, which the people visiting that site (the audience) see
when the page loads. This banner commonly advertises a product, service, or just another
website. They run across the top of an internet webpage or in a margin or other spaces
reserved for ads and are usually graphics interchange format (GIF) images. The most
popular banner ad is the horizontal banner which is placed along the top or bottom of a
web page.
According to the internet advertising bureau (www.iab.net), the standard banner size is
468 pixels high. This takes up approximately 10% of a normal sized web page. There is
enough room for text, graphics or animation. Since most banners only hold the attention
of a visitor for at best 3 to 5 seconds, design is critical. Concise, clear messages that are to
the point are most effective.
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Buying and selling banner ads.


Banner space is usually sold by impressions, or banner views, although it is sometimes
sold by click-through when the user clicks on the banner for more information. Banner
advertising can cost anywhere from $25 to $150 per 1,000 hits, depending on the website
an advertiser choose. One can also participate in banner exchanges with complementary
businesses. The other business owner gets to place a free banner advertisement on your
website and you, in turn, get to place one on his website promoting your product or
service.

Types of banner advertisements.


Through GIF images are the most commonly used banner ads, several other types of
banner can be created, such as static banner, animated banner or interactive banner. There
are also different kinds of interactive banners – HTML, interactive banner allow user to
have interactions, and rich media banner allows user to have even more interactions such
as playing games, banner ads are of-then animated because animation has been shown to
attract a larger percentage of users.
There are two major types of banner’s static banners and dynamically rotated banners.
• Static banner do not change, they stay the same to every user, every page load.
• Dynamic banner can change for each user. With each and every click.
A dynamically rotated banner is usually a more effective way of advertising, but it
requires a program to make it work, usually a CGI script.

User of banner advertising.


• To increase the traffic on the site.
• To sell more of your product or service.
• To be able to notify buyers of new product or service, or offer them a special
deal/discount.
• To spread your ideas about a certain topic.
• To get people to remember your company name.

Advertising on the internet translate into more sales and visibility and brands recall for
your website. Banner advertising can be done either independently or through existing
applications that simplify the whole process. The main advantages of advertising
individually are:
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Advertising – the new age mantra


David Ogilvy of Ogilvy&Mather once famously quoted as “the consumer is not a moron,
he is your wife”. The fact that companies are now realizing that raising ad spends is no
longer a debt burden but rather an investment for the future, has shown that advertising
has become an integral part of every products success and for that matter its failure as
well.
Sunil Alagh, the ex-managing director and CEO of Britannia industries pointed out that
“the success of a product can be measured in terms of how effectively it can be
communicated to the consumer”
The current lots of F.M.C.G companies use advertising as a fighting tool to upset their
rivals rather than to up bring their product. The coca cola and Pepsi war (so fondly known
as the “cola wars”) has given new dimensions to advertising. Consider this: HLL spent
more than Rs.696.58 crores by the year ending December 2000 and the ad-spend has
further increased by 10% in the next year. This proves the fact that companies lay a lot of
emphasis on advertising of their products.

The important reasons why one should advertise are mentioned below:
 Advertising helps in building a “Brand Name” for the company.
Today when we hear the word “Thanda” we immediately associate it with Coke. A
company has to build up its brand name for its products so that the consumers do not
shift to other rival products. In making a brand name a company has to be loud and
clear about its products and its qualities, this is where advertising steps in.

 Advertising helps a consumer to understand about a product:


A consumer gets to know more about the product available in the market through
advertising. In case of F.M.C.G companies it is more important because the products
have to continue over a long run in the market and have a wider competition
compared to the other sectors.

 It acts as a tool to upset the competition:


Advertising is definitely a tool to upset competitors and up bring your product in place
of theirs. Even today people recognize butter with “Amul” brand even when there are
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other brands existing in the market because of the infamous Amul butter girl who has
acquired an iconic status.

 “Jo dikhta hai, wahi bikta hai”


This applies to all the companies in every sector. Consumers buy what they see and
neglect what they don’t identify with. They are influenced by the flashy
advertisements which affect their buying motives.

 Persuasion:
Advertising helps in persuading the prospective buyer in taking a decision regarding
the product. In a supermarket the advertising acts as a factor why the consumer goes
straight to the soap of a particular brand or toothpaste of “x” company.

 Helpful in introducing new products:


Advertising is a tool which helps in introducing new and innovative products in to the
markets. Companies spend a large chunk of their revenue on research and
development of new products and when such high stakes are involved companies
would not want their products to fail in the market.

Advertising significantly contributes to the creation of top brands and increases their
brand values. Today when one hears the word “Ye dil maange more” or more recently
“youngistan ka wow” then the next person immediately understands that he/she is
talking about Pepsi. This is the impact of advertising. Gone are the days when one
used to sell the products by going door to door or through salesman or the next door
“baniya”, today advertising helps one out if one has to successfully run a product.
Some of the advertising campaigns and their punchlines are mentioned below:

Slogan Company/product

Thanda matlab Coca cola


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Youngistaan ka wow Pepsi

Dentist ka sujhaya hua no 1. brand Colgate

Utterly, butterly delicious Amul

Kit-kat break to banta hai Kit Kat

Kuch meetha ho jaaye Cadbury’s dairy milk

G matlab Genius Parle-G

Boost is the secret of our energy Boost

Tan ki shakti man ki shakti, bournvita Bournvita

Lagey raho! Alpenliebe

(lifebuoy hai jahan yandurusti hai wahan----lifebouy)

The Implications of Advertising on the Buyer:


It has been argued from the beginning that “advertising does not add any value to the
product rather it helps in increasing the price of the product. The consumer is not
influenced by the flashy ads and does not respond to them.” These statements do not hold
true in the real sense. When one goes in to the market one can notice how consumers
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recognize a particular brand of toothpaste from the 20 odd brands available and he asks
for a particular brand only. This proves the fact that how much impact has been created by
the particular brand through advertising.

Advertising is not a waste and companies set aside huge budgets for advertising just so
that they can create an impact in the minds of the consumer. The consumer also gets valid
information through advertising like in case of social service messages like the polio ad
campaign or the aids awareness campaign, this helps the consumer know what is
happening around him. Also in case of F.M.C.G companies some products which are
complex to use can be well explained and their utility be made known to the consumer.
Advertising has played a major role in re-establishing and increasing the shrinking sales
of some products

One strong example of this can be the re-launch of the “Frooti” brand of mango drink a
few years back. A fictitious character by the name of “Digen Verma” was created by the
company and his name was flashed all over raising the curiosity of the people. This
curiosity was later removed by introducing the product. This campaign helped Frooti re-
establish its market share and helped in increasing the sales for the company.

Also recently Dabur had re-launched its chyawanprash brand with a new look and a new
ad-campaign, this has helped Dabur to regain some of its lost share in the market which
has been dominated by it.

There is a defined strategy for advertising known as the A-I-D-A model of advertising
promoted by Mr. Elmo Lewis which emphasizes on how a customer purchases a product.

The model is followed by companies for formulating advertising strategies.

A – Denotes “attention” which refers to the ability of the advertisement to attract the
attention of the consumer. Often there are products which may be good in quality but are
ignored by the consumer because they are not able to generate enough attention.
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I – Denotes “interest”, once the product draws the attention of the consumer, there should
be an interest created in the minds of the consumer for the product. It is only when an
interest exists that a company will be able to establish the model successfully.

D – Denotes “desire”, it is the desire to own and possess the product. Often we see small
children forcing their mothers to buy them a particular chocolate or food because they
have seen it with their friends or they are very much influenced by the advertisements.
Once the desire is created it will always get converted in to ownership of the brand.

A – Denotes “action”, the final result of all the efforts is the ultimate decision made by
the consumer to purchase the product. The company cannot sit back and wait for their
products to sell automatically. The desired action in terms of brand building and further
increasing the sales should be in the minds of the company. The company should try and
maintain its relations with the customer. According to Paretos law, 20% of customers give
80% of the business. Therefore a company should hook the consumers on to the brand
and make them “brand loyal”.

Advertising has the following effects on the


consumer perceptions:
It helps the consumer to identify the product

 It is useful to realize which brands are available in the market


 It helps in delivering the importance of the product
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 It helps in bridging the gap between the company and the consumer
 A consumer can realize what is good and what is bad for him.
 It influences him to buy a particular product
Overall advertising creates a desire in the minds of the consumer regarding owning the
product. It makes him think about going for a particular company’s product over his rivals
products.

The mere fact that the “Thanda Matlab Coca-Cola” advertisement increased the sales of
coca-cola by more than 10% proves the fact that consumers are receptive to advertising.

Also companies advertise their various offers and promotions through the medium of
advertising. The consumer is ignorant to these offers unless he has been exposed to a
healthy dose of commercials or prints showing the offer. Research has shown that
advertised products have more chances of survival in the long run than the non-advertised
products.

A recent study conducted by MCI India took into consideration people from various
sections of the society and is worth mentioning in the report. The study divided the
consumers in to male and female categories and in each category they divided them in
three parts. They were segmented as per their age, status, location, basic traits. The study
revealed the following information:

INFLUENCES OF MEDIA ON CUSTOMER


PURCHASE DECISIONS
Television 77%

Ads in newspapers 40%

Free samples 38%


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Word-of-mouth 38%

Ads at purchase points 34%

Shopkeepers 32%

Articles in dailies 30%

Hoardings 26%

Ads in magazines 23%

Fillers/Leaflets in dailies 22%

Also the research has shown that consumers in cities like Delhi, Mumbai and other metros
are likely to get influenced in purchasing the product if it is advertised. This simple fact
has shown that companies do require advertising to support the qualities of their product.

Media and agency selection for F.M.C.G products


Merely spending hoards of money in advertisement is not going to help the product. It
should be coupled with the right type of media and the best use of the possible methods
for advertising. The right kind of media selection is done by utilizing the following
strategies:

Budgeting expenditure:

Before selecting the media one must keep in mind ones budget. Companies like HULL,
Coca-Cola, and P&G etc. keep aside a sizeable proportion of their expenditure for
advertising. The advertising budgets of the company are influenced by the product sales
and its popularity. It is essential to understand that the money spent by these companies
will not flow back in but will reflect in terms of the sales achieved by the company in the
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annual budget. Since advertising expenditure has to be deducted from the sales, it is
essential to plan it in advance to avoid wastage of resources.

Selecting the media based on the budget:

Once the budget is set then one can select the media which will be utilized by the
company to commercialize its products. The various medias available will be discussed in
the next chapter. Companies which have a huge ad-spending select the best possible
medium while those working on a tight budget try to find out the cheapest and most
effective medium through research.

Analyzing the media reach:

The media selected should be able to effectively reach a number of people and should
convey the message sent by the company. The following table gives the consumer
demographics relating to the various media available in the urban areas and their response
Nowadays while selecting the media companies have to also keep in mind the government
rules and regulations. The government of India has banned the advertisements done by
cigarette and liquor companies and they cannot violate this rule.

From the table given it is clear that the reach of television is the greatest among all the
mediums available and that all classes of society show a similar response to the television
advertisements.
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Purpose of advertising:

One should define the goals for which the advertising has been done. Proper planning of
the objectives and goals will lead to successful advertising decisions. Companies have
specific interests and specific target segment in mind when they want to select the media.
Companies who are going to re-launch a brand have to pay more attention towards the
advertising because it can be detrimental in deciding the fate of the brand in the years to
come. Recently Dabur had re-launched its brand of chyawanprash. The purpose was to
make the brand more contemporary and to make it relatable since the brand was losing its
relevance over a period of time, besides the company had also renewed the packaging and
the look of the brand. The campaign featured Mr. Amitabh Bachhan and the campaign
was a success resulting in growth of the brand and cementing its market share.

Keeping in mind the demographics and the influence of various media on buyer behavior
(mentioned in earlier part), one should select the most useful media.
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Agency selection:

After the companies finalize their objectives and goals, it is now time to select the most
appropriate agency to fulfill those goals. In India there are more than 100 ad agencies and
most of them are pioneers in the global market. There are agencies, which have a base in
foreign countries and have established themselves in India like Ogilvy&Mather
worldwide. Some of the best names in the industry are given below:

 McCann Erickson (global)


 Lowe India (global, equity participation in enterprise nexus communication in
India)
 Mudra (Indian)
 WPP (global)
 Lintas (global)
 FCB Ulka (global, equity participation of 51% from Foot Cone &Blending, New
York )
 Grey Worldwide (global)
 Ogilvy&Mather (Indian subsidiary)
 Leo Burnett (global, equity participation in Chaitra India )
 J.Walter Thompson (global, acquired Indian subsidiary Hindustan Thomson
Associates)
The A&M magazine survey indicated that the largest 25% of agencies account for nearly
75% of the top billings. The increase in the ad-expenditure of Indian companies and the
tough competition makes it all the more sense to establish a subsidiary in India. Most of
the ad agencies are from the big apple and have grabbed the opportunity after
liberalization opened the doors to the economy. Most of the agencies have either acquired
or have equity participation in the Indian agencies. The agencies have given us names like
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Piyush Pandey, Prasoon Joshi, R.K. Ramaswamy, Madhukar Kamath, Prahladh Kakar
and many more.

Some companies have established their own in-house agencies like Dabur has its own
agency called “Adbur” which takes care of all its advertising and media decisions. Other
companies have two or three regular advertising agencies which are given contracts based
on their creativity and name. The agency selection is done by the marketing and media
department of the company and at a given time more than three to four agencies are vying
for the accounts of a big company. A company may even have different agencies handling
its different product lines, like for example, McCann Erickson handles the advertising of
Coca-Cola while Ogilvy&Mather handles Coke’s brand “Fanta”. Thus the selection of an
agency is essential when companies have to make the most out of its advertising. It is said
that a good advertising agency is one “who is able to sell a refrigerator to an Eskimo”.
The more creative an agency can get, the more are the chances of the success of the
company’s products.

Celebrity endorsements:

The media decisions of a company also include another factor that has come in to the
reckoning that is whether to select a celebrity for endorsing the product or not. Today the
trend is that major players are using the services of celebrities who are well established
and have a mass reach. The following are the companies and some of the celebrities that
they have chosen to promote their products. Companies like Pepsi, Coke, and HLL have
an endless list of celebrities because of their nature to select a large number of celebrities
and also since they have an extended number of product lines.

COMPANY CELEBRITY

Dabur Amitabh Bachchan

Pepsi Shah Rukh Khan, Preity Zinta, Saif ali Khan, Amitabh
Bachchan, Arshad Warsi, Sachin Tendulkar, Saurav
Ganguly, ranbir kapoor
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Coca-Cola Virender Sehwag, Aishwarya Rai, Amir Khan, Hrithik
Roshan, Akshay Kumar

Cadbury Preity Zinta, Amitabh Bachchan

Britannia Rahul Dravid, Mohammad Kaif, Parthiv Patel, Sachin


Tendulkar.

HULL Aishwarya Rai, Kareena Kapoor, Katrina kaif

Parle products Dino Morea

Kurkure (frito Juhi Chawla


lays-pepsi)

Himani Saurav Ganguly, Amitabh Bachchan, Sunny Deol

Godrej Preity Zinta, Amrita Rao

The above list is endless since every major player has a variety of product lines and for
each product line he has more than three to four celebrities. Nowadays consumers are
getting more influenced by the kind of celebrity that endorses the product. Celebrity
endorsement helps a company to increase the visibility of a product in the market. The
consumer tries to relate the product to the celebrity when he goes in to the market. Also a
celebrity helps in adding value to a brand. The fact that “Navratna” brand of hair oil had
Govinda campaigning for its product which helped to increase its sale two-fold and also
increased brand visibility shows that a celebrity can be useful in adding that extra point to
the product. Nowadays we find that mostly cricket players are endorsing products because
the consumer is always influenced by them. If not the cricketers then it is the top running
film stars like Shah Rukh Khan or Amitabh Bachchan who are selling the products. The
celebrities are also helpful in revival of the brands as it happened with Cadbury a few
months back. The case is mentioned below

Cad ‘bury”

Cadbury a worldwide renowned brand for its chocolates suffered a huge setback a few
months ago. There were live insects found inside the Cadbury chocolates in many parts of
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the country. The company was set aback by the whole incident and the years of reputation
it had built up in India was at stake. The company had to withdraw all its stock in the
market and re-check it. The company had also gained a bad repute in the market and
within a few weeks the company lost more than 25% of its market share and while rival
firms were gaining an upper edge from this situation, it seemed obvious that the company
had to re-vamp its whole strategy to counter this problem. This also meant that the
company had to increase its ad-spend and also come up with something creative to bring
the customer back to its brand. The company also took the help of Mr.Amitabh Bachhan
for this purpose. The ad threw light on the company’s manufacturing process and how it
took care to protect the health of the consumer.

The aura of Mr.Bachchan and the concept of the ad proved highly successful. The
company had successfully regained lost ground and introduced the products with new
packaging and subsequently it also continued its contract with Mr.Bachchan. The
commercials helped the company to create a favorable image in the minds of the
consumer and also increased the sales for the company. The company would have had to
otherwise fold up its operations in India and it would be a major loss for it since the
Indian markets account for a large share of Cadbury’s worldwide revenue.
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(Above: advertisement created for Cadbury Dairy Milk by Ogilvy & Mather, endorsed
Mr. Amitabh Bachchan)Though the idea might seem worthwhile but there is also a catch
to this entire aspect of celebrity endorsements. Celebrities have to be paid hefty sums to
retain them, a Sachin Tendulkar commands anywhere between Rs.1 to 2cr. per
commercial. Also, if the celebrity is unsuccessful in his profession then it might as well
rub on to the product. But companies are ready to take this risk in a bid to stay ahead of
their rivals.

Various media available for advertising


Print media:

The print medium is one of the effective medium to advertise the products. The print
medium includes newspapers, magazines, journals and other written material printed and
published in India. There are over 40000 publications in India covering more than 256
languages all over India. The level of reach of the print medium has been growing day by
day. The print medium is cheaper than other forms of advertising.

The rates charged by newspapers and magazines are based on the size of the
advertisement and the number of times it should appear. Some of the leading newspapers
and magazines in the country are:

The Times of India

The Hindu

Business world

Business today

Deccan Chronicle

The Indian Express

Film Fare
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The main advantages for the companies in advertising in the print medium are:

 The companies do not have to spend as much as they spend on other mediums of
advertising.
 The print medium can be utilized to convey messages in local languages.
 The print medium has a reach among the masses. Information can therefore be
disseminated to all parts.
 It is useful to start of the advertisements on a small scale.
 The print medium plays a big role in promotional activity. Recently both P&G and
HULL had decided to cut the prices of its products. The print medium was utilized
to a great extent to convey these price cuts to the consumer.
 The print medium has more “Brand Recall” value since advertisements on
television are seen just for 10-15 seconds, whereas a print ad can be given daily
and consumers can take notice.
 In case of F.M.C.G companies the high variety of product lines and new products
coming up every second month makes it essential to tap this medium.
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(Source: -TAM and ADEX INDIA)

However each coin has two sides to it. The print medium has its fair share of
disadvantages to it also:

 Companies are reluctant to advertise in print because of the high illiteracy levels in
India.
 The television advertisements have a greater impact on the minds of the consumer
than print advertisements.
 F.M.C.G companies usually have a high budget and therefore they always try to
compete with their rivals.
 The print ads do not carry the same impact that television ads do. After all a
person will believe what he will see live.
 One cannot be creative with a print ad as much as with a television commercial.
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Overall though the print medium is a good medium of advertising but F.M.C.G
companies still prefer to take the expensive route of television advertising and other
mediums. The same can be proven by the fact that in the last month the top 10 ad-
spenders in print consisted of all industries except F.M.C.G companies. Nowadays
mostly telecom companies like reliance, BPL, Orange utilize this medium. Reliance
alone spent around Rs.2.5 million on advertising through print. F.M.C.G companies
do utilize this medium but they do so occasionally to carry out their promotional
schemes and offers.Britannia spends nearly Rs.22cr. on advertising in print every
year. The print advertisements increase during festival seasons or during events like
cricket.

Small regional brands and companies with a low turnover cannot opt for expensive
mediums; therefore they choose print over other forms of advertising. Though much
has been said about this medium it is however to be noted that the print medium has a
52% impact, second only to the television medium. Also reputed firms like HLL,
P&G, Coca-Cola, Pepsi, Amul, and Dabur have been using this medium from a
number of years, even before other forms of advertising seized to exist. The
advertisements act as a catalyst for the television advertisements and help to increase
the impact of the product in the minds of the consumer. Also companies can explain
the features of their product in detail in the ads because they are unable to do so in a
10 second television commercial. Though it has its ups and downs the print medium is
here to stay.

Some of the Print campaigns done by various


companies
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(Right): The print campaign featuring


Bollywood super star Shah Rukh Khan
for Clinic All Clear.

(Left): The hit campaign of Tata Salt which


carried the tagline “Maine Desh Ka Namak
Khaya Hai”

Outdoor advertising:
One of more frequent forms of advertising used by F.M.C.G companies is “Outdoor
Advertising”. This form of advertising comprises of putting up signage, billboards,
posters, and kiosks around the busy areas or strategic locations around the city. The most
frequent user of this form of advertising is “AMUL” which prominently puts up hoardings
of its various humorous ad-linings throughout the city. Large hoardings and billboards
ensure that the product gets seen by every passerby. This ensures a greater brand recall
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when a customer goes to buy the actual product. In metropolitan cities like Mumbai the
cost of putting up billboards is nearly twice than that of other cities. The average rental for
a billboard (10 feet x 20 feet) can be anywhere between Rs.150000-250000 per month,
depending upon the location and area. There are other forms of outdoor advertising done
by companies in India. Companies utilize the B.E.S.T bus stops and even the B.E.S.T
busses around the city to put up their advertisements. Also very recently a trend has
started to book railway wagons or even the entire local train to advertise. The railways
puts up tenders and invites quotations from companies and the highest bidder is given the
advertising rights. An entire train could cost the company anywhere between Rs.12-17
lacs for a month. The “Digen Verma” campaign was mostly publicized by Parle for its
Frooti brand using local trains. Recently HULL had also done the same to promote its
offers and products. Also a new trend of outdoor advertising has been utilizing moving
trucks to display messages. These trucks carry the advertisement billboards and move
through the city in specific busy and strategic localities. They are very cost-efficient
because a single truck can be utilized to cover three to four areas rather than putting up
hoardings in each area.
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Radio advertising:

Advertising through radio has been on ever since the All India Radio (AIR) came in to
existence. The AIR has 116 centers in India and broadcasts in 24 different languages. One
can still recollect the popular shows like “Binaca Geetmala” and hosts like Mr. Ameen
Sayani. Today the scenario has changed with private players entering the market and
establishing themselves. As Doordarshan has lost its touch on television, so is the case
with AIR. The radio station has been overtaken by the likes of Radio Mirchi, Radio City,
Red Fm, and GO Fm, BIG Fm, etc. These stations have not only helped increase the
listener ship in urban areas but also catapulted the success ratio of radio as a medium over
television, which up to now was the leading medium in the market. The radio stations are
mostly backed by media and entertainment companies like the Star group which owns
Radio City 91fm or The Times of India group which runs Radio Mirchi 98.3fm. The
rivalry among the radio stations has been beneficial to the companies because a better deal
is possible in terms of advertising rates and air time.

The radio medium is being heavily utilized by the F.M.C.G companies for advertising
their products. Products which are targeted at the youth like fairness creams, cold drinks,
etc. are especially advertised on radio because it has a wider reach among teenagers. The
radio is an effective medium to convey the message and with a touch of humor, the
advertisement becomes much more effective. Companies like Cadbury, HLL, P&G,
Marico, Dabur and others have started utilizing this medium more frequently. The ad-
spends of companies on this medium range from Rs.5-10cr. annually and it depends on
the amount of air time that a company purchases to advertise its products.

The Close-up advertisement became more renowned after it was telecast on radio and the
company had more brand recalls after this exercise. Companies also carry out their
promotional activities through radio like sponsoring prizes for various shows and giving
discount coupons, thereby increasing their market share.
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(Source-TAM and Adex India)
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Television advertising:

By far one of the most dominant and the most used form of advertising is television
advertising. In the early days due to lack of television sets and inadequate number of
people possessing the television, the advertising was more concentrated through print but
as time evolved and with the advent of cable television a new era of advertising began
and television advertising was in its full flow. There are more than a 100 television
channels existing currently and more channels are getting added to this number every
subsequent year. It has been observed in a survey that an average consumer watches at
least 100 minutes of television everyday. This is quite a lot when one compares the reach
of other mediums of advertising.

The ministry of broadcasting and information technology has laid down the guidelines
which the channels must follow and keeping these guidelines in view the channels decide
on their strategies. The television advertisements have a number of advantages over the
other forms of advertising:

 Television advertising is more attractive than other forms of advertising because


of its live inception and delivering of the message straight to the consumer.
 Television advertising can be used to realize the impact of the advertisement;
thereby companies can plan their product strategies and future media
requirements.
 It has a wider reach compared to other forms of advertising. Nowadays even
remote locations possess television sets and since it does not require the people to
be literate, it can reach the masses.

 The impact of an advertisement is much more on television than in other forms


because the message gets delivered within seconds and it can be repeated over and
over again
 Advertising creativity can be shown more on television and one can create novel
ads to influence the consumer.
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 Companies can follow up their rivals and design ads to counter attack them.
 The advertising medium influences 77% of purchase decisions made by a
consumer. This means that investment made by companies can be recovered by
increase in sales.
 Companies as stated in the earlier part spend millions of rupees on advertising and
when the stakes are high one cannot compromise on quality of advertising.
Therefore companies tend to go in for television advertising.
 The mere fact that commercial breaks have become a necessity between television
programs shows how much this form of advertising has evolved.

The television advertising can be used as a strong support to gain a favorable edge
over the competitors and increase the visibility of the products. A product may be
available in the market but its sales do not pick up until it is known to the people. This
impact needs to be created and as they say “well done, is half done”, thus if the
promos of a particular product catch the eye of the audience it becomes easy for the
company to capitalize and create a demand for the product. Even if the product is not
better than the rival product but if the communication is better than the product has
every chance of doing well.

Currently there are close to 36000 brands that advertise on the 220 odd channels
throughout the country. The new entrant in the F.M.C.G sector, LG consumer
products, has already started advertising heavily on television and all its products can
be seen in a single advertisement.

The advertising rates are commensurate with the success of the program and the reach
of the television channel. Normally channels charge anywhere between Rs 2.5-5 lacs
for a 10 second slot and the prices go up even further in case the event or show is a
very popular one. In earlier days since the number of advertisers was limited, so also
the number of channels, the advertisers had limited options but today there is cut-
throat competition for acquiring the airtime for advertising in the top slots of top
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channels. The rates for advertising in Ekta Kapoors daily soap operas command the
highest price tag followed by another set of programs slowly catching up and that is
reality T.V. in which the channels promise to make stars out of the consumers. One of
the highest grosser of all time is the hit show “Kaun Banega Crorepati” which had the
highest ad-rates. There is a constant battle among channels to offer the best rates to the
companies and the companies are the beneficiary in the bargain. Take a look at some
of the ad-rates for the top 10 programs on the leading television channel Star-T.V:

Rank Programme Rate-card Negotiated

1 Kyunki Saas Bhi Kabhi Bahu 7,00,000 6,50,000-5,75,000


Thi

2 Kahaani Ghar Ghar Ki 7,00,000 6,50,000-5,75,000

3 Kasauti Zindagi Ki 6,00,000 5,40,000-4,75,000

4 Kayamath 5,00,000 4,50,000

5 Kumkum 4,45,000 3,55,000

6 Meri Awaaz Ko Mil Gayi 4,00,000 3,75,000


Roshni

7 Kasturi 4,00,000 3,40,000-2,75,000

8 Saarthi 400000 3,40,000-2,75,000

9 Bhabhi 3,45,000 2,75,000-1,85,000

10 Baa Bahu aur Baby 500000 4,40,000-3,75,000

(Note: the above rates are for a 10 second slot)

The rates mentioned are for the television channel Star T.V. which has a most number of
successful television programs and commands a TVR (television viewer ship rating) of as
high as 15.5 compare this to the hit shows on Sony and Zee T.V. which have a television
rating of only as high as 5.5. This makes star the undisputed leader in the television
channel industry. star also has the majority of Ekta Kapoor shows and the famous trio of
Kyunki.., Kahani and Kasauti which still command the highest ad-rates even after their
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third generation has come in. recently though the tides are changing in favor of zee and
Sony who have launched an array of new shows. Sony has come up with Thodi Khusi
Thodi Gham which helped the TVR ratings of Sony zoom to a new high and also it has
come up with the third season of reality show Indian Idol which has also caught the fancy
of the audience. Zee is also not far behind with its reality show Sa Re Ga Ma Pa
Challenge 2007, a nationwide “Talent hunt for the Budding singers” which currently has a
TVR OF 4.5.

The most important factor which drives the television advertising is cricket. The match
especially those that are played between India and Pakistan command then highest ratings
and the rates for advertising are also high for them. The World Twenty 20 held in South
Africa, saw the maximum number of advertisers buying the slots.

Another fact that has come out is that small channels are beginning to gain an upper hand
with the advertisers because of their reduced rates and competitive programs. The
observation made by economic times gave the following results. Also the plethora of
news channels that has come up has also eaten away the share of the big players.
Companies are also banking on the success of regional channels like Sun T.V., Surya
T.V., MAA T.V... And others. While Sun T.V. has a 15% share in Tamil Nadu, Gemini
T.V. has a share of 32% in Andhra Pradesh.

According to Bernard Glock, manager, global media and communication at P&G, “We
like to work a lot with individual channels like MAA TV that may not be a ratings
leader but we are able to orchestrate a project per our requirements and these have
proved to offer very good support in addition to larger networks”.

The next page contains a list of the niche television channels that cater to the specific
demand of the consumer but they command an equally impressive share in the market.
The rates are equivalent to those of the regular channels.

Channel Duration(seconds) Value (000) Duration (%share)

Set Max 3502667 2655745 8.62


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Star Movies 1291337 776169 3.18

Star Sports 908685 506890 2.24

TNT/Cartoon network 873841 420211 2.15

HBO 943666 419445 2.32

ESPN 917669 342297 2.26

NDTV (24x7) 1124813 380733 2.77

Star World 677013 226430 1.67

Star News 2284443 737772 5.62

Sahara TV 1753598 300242 4.32

Sab TV 2168151 308190 5.34

ZEE Cinema 2531967 649616 6.23

(Source: brand equity, economic times)

The above list is exhaustive but not comprehensive; there are other channels which also
have an equally commanding share in the market. Recently there were 4 new channels
added to the list that is star one, Sahara One, Star Utsav, and Zoom.

Coming back to the F.M.C.G companies, they advertise on the prominent channels and
mostly occupy the prime slot that is the time between 9 to 10p.m. also they advertise not
only on one channel but on numerous channels depending on the budget.

Normally the budgets for F.M.C.G companies goes anywhere between Rs.2-4cr. per
product for television advertisements. The top 10 companies on television surveyed by
TAM agency for the economic times are given below and their corresponding figures of
ad-spends are indicated:

(Figures in crores)

Brands Ad-spends(june-06) Brands Ad-spends(june-06)

Close- up 3.4 Rejoice 1.8


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Fair and lovely 2.7 Fair and Lovely 1.5

Colgate dental cream 2.1 Colgate dental 1.5


cream

Tide 1.5 Surf Excel 1.4

TVS 1.5 Election 1.3


commission

Pepsi 1.5 Reliance mobile 1.3

Lizol 1.4 Airtel 1.3

Breeze 1.4 Dettol 1.2

Parle-G 1.4 Clinic plus 1.2

Clinic Plus 1.3 BJP 1.1

(Source-TAM and Adex India)

The above report clearly indicates the dominance of F.M.C.G companies on the television
and they are constantly increasing their budgets as per the need of the hour.

Constant surveys are carried out by companies or market research agencies to determine
the amount of “brand recall” a consumer has after he has seen a particular advertisement.

The companies that have the highest brand recalls can dub their advertisement as a
success.

A recent survey undertaken by the PITCH magazine reveals the percentage of brand
recalls from among 378 respondents that were surveyed by it. The survey revealed that
among their top 10 brand recalls, 5 were of F.M.C.G companies.

Company /Brand Recall (in terms of %)

Pepsi 9.8%

Idea 5.0%

Pepsodent 3.4%
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Airtel 3.2%

Santro Xing 2.9%

Vodafone 2.6%

Kurkure 2.1%

Dabur 2.1%

Ford Icon 1.9%

Close-up 1.9%

Overall television advertisements are here to stay, though recently there has been an
argument that there is a high rate of “avoidance” of advertisements on television because
of the increase in the commercials but one cannot ignore the fact that they have become a
part of the daily television viewer. One just cannot imagine a serial or a movie without a
commercial break. People will avoid ads but this might just be the reason to spur the ad-
agencies and companies to come up with more creative and sensible ads.

New trends in F.M.C.G advertising

Films and television serials:

Companies are nowadays using films and television serials as a medium to advertise their
product. Subhash Ghai’s film “TAAL” and “YAADIEN” can be quoted as examples.
While the former had Coca-Cola advertising its soft drink, the latter had both Coca-Cola
and Pass Pass, mouth freshner brand advertising through it. The advertisements with the
association of the film were splashed all over and the movies might not have made their
mark at the box office the brands were able to generate a lot of interest and consumer
attention. Recently other movies were also used as a medium for advertisements by
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companies. Coca- Cola once again came in to the picture when it associated itself with the
movie “KAANTE”. The company advertised its brand Thums-Up through this movie.

Then there is the tooth paste brand Close-Up which also took the filmi route and
advertised through the recently released Vivek-Aishwarya starrer movie “KYUN...HO
GAYA NA”. (vicco bajradanti in wanted)

This trend is fast catching up with the companies who want to constantly stay ahead of the
rising competition. The movie producers do not mind it at all, after all even they want to
have a share of the pie. According to ace filmmaker Subhash Ghai, “Film industry is
becoming commercialized and there is no harm in using it as a medium to promote the
products”. Not far behind in this trend are the television soap operas which have now
assumed a great importance in everyday life of the people. Ekta Kapoor’s TV-serial
“Kahinn to Hoga” was used by Lux to advertise its brand.

Companies also see this as an opportunity to sell their products and merchandise through
various promotions run along with the films. Thums-up had organized a contest in which
the winner would be flown to Los Angeles where the movie was shot and see it over
there. There were similar promotions carried out by other companies.

However this form of advertising does not yield the required results all the time. with
films flopping with every going Friday and the money involved in such kind of marketing
being very high, it is only restricted to the big players and those who want to take risks.

Internet

The internet has become a powerful medium in recent years and information technology
has certainly spread its wings. The world has become closer and one can get any
information about any subject through the internet. The western countries have already
been a step ahead in this revolution and e-commerce, as it is called is already well
established in the western countries. However this concept of using the internet as a tool
to advertise the products has not been developed in India. The reason for this is the poor
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literacy levels and the inadequate reach of the internet in all the parts of the country. Also
not many people believe in the advertising done or products sold through the internet.

In spite of this, many companies have come forward and started utilizing this medium.
Companies like HLL use their websites to display their products and give the customer
information. Also companies carry out promotions and various contests through the
internet. Companies also use websites like Rediff, Yahoo, and other search engines and
display their advertisements on their websites.

Advertising on tickets

Another new trend in F.M.C.G advertising can be seen in the form of advertising on
tickets. The tickets of various kinds like airlines, trains, events, and even recently of
B.E.S.T busses are used for advertising. Priyagold biscuit is the first company to advertise
on the back of bus tickets. The event tickets of cricket matches, shows and other events
carry the advertisements of the companies.

Ambush advertising:

One of the latest forms of advertising, though not dubbed legal by experts is “Ambush
Advertising”. This form of advertising has cropped up because of the monopolistic nature
of advertising done by companies. During the Olympics in Athens companies like Coca-
Cola, Kodak and others pumped in more than $60 million each to acquire the rights and
privileges for the event and to use the official logo for their products. But in spite of this
they were not able to go solo because other companies started advertising their products
using different routes. Soft drink major Pepsi made advertisements using David Beckham
(since he was their brand ambassador then) and indirectly used the Olympic event and
deflected attention. The result was that Pepsi had more brand recalls than the official
sponsor Coke after the event ended. The International Olympic Committee makes sure
that its sponsors get their due but one cannot prevent sponsor’s from backing their
individually sponsored teams or individuals. The repetition of this fool proof style of
advertising was seen in the 2007, ICC Cricket World Cup, held in West Indies.
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Companies like Nokia, Coke, TVS and others though not being the official sponsors did
not hesitate to advertise their products through their brand ambassadors. Since Coke had
Virender Sehwag as its celebrity, it made ads on him rather than on the world cup, thereby
gaining an indirect entry in to the world cup advertising. This form of advertising is useful
for companies because they do not have to spend hordes of money in sponsoring the
entire event, rather they can just pay for the ad-spots on the television or other media and
utilize the benefits of being noticed in the event. But care has to be taken in such form of
advertising because if companies are found violating the code of conduct set by the event
then they have to pay compensation which could be more than what they would have
actually paid for sponsorship. Nevertheless, ambush advertising has made companies to
become more creative in their approach and to think of innovative ways to market their
products.

SMS (short messaging service):

Another new form of advertising that has evolved is advertising through cell phones. The
Short Messaging Service or SMS is used to send various messages or offers regarding
products to the consumers. In the beginning there was an uproar created against this form
of advertising because consumers had to unnecessarily bear the cost of receiving
messages when they were roaming outside their city. Therefore cellular companies were
under pressure to remove this service. Nevertheless with an increase in the number of cell
phone users in India and the change in tariff plans over the years this method will fast
catch up with other forms of advertising as well in the coming years. Currently there
aren’t any F.M.C.G companies who make use of this service.

Global scenario of F.M.C.G advertising:

Globally, F.M.C.G advertising is much more advanced than what it is in India. Most of
the companies outside India advertise their products through the internet and make the
maximum use of technology. In foreign countries like the United Kingdom and the United
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States of America, there are separate channels where these companies sell their products;
it is just like tele-shopping which was launched in India a few years back. Globally, there
is a lot of competition among companies selling F.M.C.G products. In the U.S.A alone
there are more than 100 brands of detergent available, this puts added pressure on the
companies to advertise and create a brand name for their products. In countries like Japan
the products are also sold through such channels and the concept of SMS is widely used
since it is a technologically advanced country. Also almost all ad-agencies that operate in
India have their bases in foreign countries. The advertising done globally is much more
creative and mostly abstract form of advertising is used to convey the message. F.M.C.G
companies lay special emphasis on the selection and execution of their ads.

Overall, the global advertising scenario is much better than that of India but there is no
denial that India is fast catching up to the international standards.

Successes and Failures of advertisements

Since we have already studied about the media advertising of F.M.C.G products let us
now look at some of the successful and not so successful advertisements of F.M.C.G.
companies in the past. A company and agency puts in a lot of effort to see to it that its ads
work out well but it is not always that all the ads work.

Successful ads:

1. Coca-Cola ad featuring Amir Khan: When one is mentioning successful ads it is a


crime not to mention this advertisement. The “Thanda Matlab…” campaign has
been a nationwide hit for Coke and a bitter memory for rival Pepsi.

2. Close-up campaign (kya aap close-up karte hain): the use of a simple yet effective
concept of boy impressing girl with a smile has brought in a lot of accolades from
critics.
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3. Dandi Namak (pehle istemal karein, fir vishwas karein): The ad tried to create an
image for the company in a market where Tata Salt was leading for the past
number of years and its simple tagline did wonders for it.

4. Kurkure (masti bole to… Kurkure): The bubbly Juhi Chawla keeps the audience
glued to watch the ad. The ad is a take on various serials and frito lays has
managed to pull off a winner here.

5. Nirma (sabki pasand nirma): The Company has kept using the same tagline and
the same concept from the start and the audience doesn’t seem to mind at all. The
ad will probably never die down.

6. Axe Deodorant: The ad showing a not-so-hip person displaying cool dance moves
and attracting girls was able to attract the attention of the audience.
There are other efforts worth mentioning like the pepsodent (dhishoom, dhishoom)
campaign and the Alpenliebe (lagey raho) campaign.

Though the following ad campaigns cannot be dubbed as entire failures but they were not
able to bring their products in the limelight.

1. Vanilla Coke (Vivek Oberoi) campaign: The ad adopted an old meets new strategy
but consumers were unable to notice anything apart from Vivek Oberoi of course.
2. Mountain Dew campaigns: One cannot understand how a person can snatch a can
from a Cheetahs mouth nor do wild things without getting hurt. Lack of
imagination and creativity is what the campaigns suffered from.
3. Fair and Lovely ads: The ads have stirred a controversy ever since they started
showing that only fair girls get good jobs. The ads were pulled off air and
currently new ones are on which portray a different story
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4. Close – up campaign (featuring Nethra Raghuraman): Remember the ad where a
prisoner asks to kiss the female jailor as his last wish? The ad was pulled down
immediately after its launch as the AAI was under pressure from various NGO.
As Leo Burnett once pointed out that “it is far easier to write a speech than to write an
ad”. The fact is that even the companies do not know what might interest the
consumer so every company gets to taste success and sometimes failure as well.

the various spending done by companies on the media and for creating
advertisements, the very potent question here is whether only a company spending
crores of rupees is entitled to have its product being sold big time over its rivals. Can
the company create an impact with a simple message?

This was the very essence of an article published in the Business World magazine.
The answer to this is that a company need not spend a lot of money on creating flashy
advertisements and hiring expensive celebrities for its ads but it can deliver the
message with a simple ad also. Creativity is what is required rather than being flashy
and magnified. Take for instance the Ghadi Detergent ad, it just carried a simple
tagline, “Pehle Istemal Karein, Fir Vishwas Karein”, the ad became a hit and pushed
the sales of the company. Similar examples can be quoted of Dandi Namak, Ujala
Supreme, whose ads were not at all big but yet effective.

That does not mean at all that companies spending hoards of money and getting
celebrities to do their ad are wasting their money but the above words act just like a
silver lining for those who thought that ads can be made only when you have a budget
of Rs.3 - 4cr.

Just like getting big stars for a movie does not guarantee its success, similarly just
spending money and not being creative will not ensure success as we have seen in the
latter part of the report wherein the “failures” were mentioned, which suffered from
lack of creativity rather than lack of money.
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The moral of the whole story is that companies can achieve success in a limited budget
and by making sure that they concentrate on content rather than big bucks.

Deciding on media and measuring effectiveness:


Advertising’s main task is to select media to carry advertising. The steps here are deciding
on desired rich, frequency, and impact; choosing among major media types; selecting
specific media vehicles; deciding on media timing; and deciding on geographical media
location.

Deciding on reach, Frequency, and impact:-


Media selection is finding the most cost-effective media to deliver the desired number and
type of exposure to the target audience.

The next task is to find out how much exposure will produce a level of audience
awareness. The effect of exposure on audience awareness depends on the exposure’s reach
frequency and impact:

 Reach: The number of different persons or household exposed to a particular


media schedule at least once during a specified time period that an average person
or household is exposed to the message.

 Frequency: The number of times within the specified time period that an average
person or household is exposed to the message.

 Impact: The qualitative value of an exposure through a given medium (thus a


food ad in good housekeeping would have a higher impact than in the public
gazette).

Choosing among major media types:


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The media planner has to know the capacity of the major media types to deliver reach,
frequency, and impact.

Target audience media habit: Like radio and T.V are the most effective media for
reaching the teenagers.

Product Characteristics: Media types have different potential for demonstration,


visualization, and explanation, believes and color.

Message Characteristics: Timeliness and information content will influence media


choice. A message announcing a major sale tomorrow will require radio, T.V, or
newspaper.

Cost: Television is very expensive, whereas newspaper advertising is relatively in


expensive.

Deciding the media timing:


Media timing is also a very important factor for effecting advertising and media as well on
prime time the cost of advertisement is regarded the most effective.
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Measuring Sales Impact of advertising:

Share of
Expenditure

Share of
Voice

Share of
Mind &
Heart

Share of
Market
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Factor Affecting Media Use:

1. Product:-

The product life cycle influences the media use. There are four stages of the
product life cycle. Introduction, growth, maturity, and decline. The choice of
media is dictated by these stages. In the first stage, the promotion of awareness of
the customer is essential.

Therefore that media should be selected which reaches the people quickly. In the
maturity stage the choice of media reaching people selectively will be more
appropriate. The decline stage needs a cheap and continuous reminder through a
medium.

2. Market:-

The existing as well as potential markets are the main consideration for
deciding upon a particular medium. The medium should deliver the message to
the potential customers effectively and economically.

3. Channel:-

The channel of distribution is considered when deciding upon media use. The
‘waste’ circulation should be kept to the minimum. Certain media vehicles are
bought to influence dealers as well as the ultimate consumers, the development
of media strategy become complex because of the availability of multiple
media and nationwide distribution.

4. Message: -
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The type of message to be communicated determines the type of media to be
used. If the message is developed to demonstrate the product’s identity, it will
not use the ratio; it will use T.V and the print media. Color and picture are
used by magazines. The method of use is demonstrated by television.

5. Media:-

There are different types of media mass media and individual media.
Thousands of different items, such as calendars, pens and diaries are used for
advertising process the characteristics of a medium are the deciding factors.
The media decision is based on several other variables, characteristics of each
medium, the needs of the market, and so on.

6. Budget:-

The advertising budget determines the media use. The expenses are allocated
on the basis of the need and capacity of the organization. The budget is based
on sales, production and market potential. It is generally a fixed percentage of
sales.

ISSUES IN ADVERTISING:-

No surrogate ads please

Following the restriction on advertising and ban on sports sponsorships last year, cigarette
companies such as ITC and VST, and liquor companies such as UDV, MC Dowel, UB
now face another hurdle. The information and broadcasting ministry is planning to go
hard on surrogate advertisements by cigarette and liquor companies.

The ministry has already clamped down on two brands- Mc-Dowell no 1 and Gilbey’s
green label- which have been using surrogate advertising extensively to sell liquor. The
ministry had issued show- cause notices to broadcaster such as star, zee, Sony and Aaj
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Tak seeking explanation why action should not be taken for violation of rule 7 of the
cable television Network Rules, 1999 for carrying surrogate advertising on liquor.

According to rue 7 (2) of the act, no broadcaster is permitted to show advertisement


which promotes directly or in-directly promotion, sale or consumption of cigarettes,
tobacco bottle or infant food. Both zee and star have agreed to withdraw the ads, while the
other channels are expected to follow suit.

Five other brands have come under the magnifying glass now- charms cigarette, Smirnoff
vodka (both also sell audio cassette and CD,s ) , Haywards 5000(darting kids). A
committee has been set up to look into the issue. The committee will review various
advertisements and determine whether a particular advertisement would be categorized as
surrogate advertisement or not. The advertisement of the product would be considered
surrogate if there was a clear recall of the actual product.

The clamping down on surrogate advertisement will weight heavily on these companies.
Domestic liquor majors have been facing increasing competition from international
brands launched in the country by leading global liquor major post removal of restriction
on imports. Restriction on the most effective medium of advertising i.e. Television would
obviously hamper brand building. The cigarette majors have been facing decline in
volume for the last 3 years and rising competition from cheap smuggled products. Brand
strengthening activities would naturally be curtailed if the ban on surrogates were
implemented effectively. It remains to be seen if retailing initiatives under the wills
lifestyle brand by ITC is also considered a form of surrogate advertising or will the ITC
clout be strong enough to convince the regulations that retailing is a full-fledged business
undertaken by ITC.
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Half the money I spent on


advertising is wasted; the
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trouble is, I don’t know


which half.
John wanmaker.*

*Indian Management-Oct
2004 page no 68

Research Methodology

RESEARCH METHODOLOGY
RESEARCH OBJECTIVE
The objective of the research is to collect the impact of advertisement and ways of
advertising through which companies and consumer both can be aware about the product
and services.

To achieve the objective of the project there was some information which was to be
gathered and according by some decision has to be taken. Under this project I have
studied the different medium and role of media in FMCG products along with the growth
of the sector.

Area of coverage and sample size


The survey was restricted to urban and sub urban of Varanasi. A total of 100 people were
surveyed who represents the universe.
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Time period:
The duration of the whole study was of one month. The survey and data collection go hand
in hand. It was started in the mid of March and last mid of April 2011.

Characteristics of Marketing Research.


1. Scientific Method.

Effective marketing research develops innovative ways to solve a problem: careful


observation, formulation of hypothesis, prediction, and testing.

2. Research creativity.

At the best, marketing research develops innovative ways to solve a problem: a


clothing company catering to teenagers gave several young men video cameras,
then use the videos for focus groups held in restatements and other places teens
frequents.

3. Multiple Methods.

There should be multiple methods of marketing research.

4. Interdependence of models and data.

5. Cost of information should be less.

6. Ethical marketing.
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The trade of advertising is


now near to perfection
that it is not easy to
propose any improvement.
Samual Jhonson.*

Research findings:

Effective media of advertisement:-


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Media of Advertising.

The most powerful and fast reaching medium of advertisement


is Newspaper, T.V than poster etc.

The attracting power depends upon how many times a viewer


see’s the advertisement and by which mean.

Educational qualification of the people Surveyed:-


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U.G-Under Graduate 10%,

G- Graduate 78%,

P.G- Post Graduate12%

Qualification is the factor that influences the thinking ability


of the people and the viewers who see and grasp the
Advertise.

Annual Income of the People surveyed:-


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1. Less than 1
Annul income in lakhs.
2. Less than 5

3. 5 and above.

Income level is the major aspect and it tells


the ability of purchasing of the product and
services as well as willingness to pay for the
product.

Subscriber of newspaper and magazine:-


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P
E
R
C
E
N
T

1. Magazine.

2. News paper.

Buyers of News paper are more than enough as


comparison to the magazine. So advertisement in
the news paper will be viewed by maximum
commodity.

Recalling media & Advertisement of an FMCG product:-


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1. T.V

2. News Paper

3. Bill board

4. Magazine

5. Others.

Recalling is something Depend upon the


repetitions of the advertisement and the mode
by which viewers can see the product or
services.

Conclusion:-

A 100 of people were surveyed representing all group and classes. As per the research
was to find out the most effective media of advertising there could be many parameters to
major the effectiveness of a media. Effectiveness could be in many ways and many terms
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also. Effectiveness of a media for a consumer is those gives information or communicates
the advertised message most of the time. Te most effective media for an advertiser could
be that one which communicates the message most of the time.

Survey gives the facts that the most effective print media is News paper and in electronic
media is T.V

Going by the trends in the market F.M.C.G companies are dominating the entire
advertisement industry. They occupy the highest position in terms of ad-spends and the
figure is going to swell even further with new products and new companies entering the
market. The findings on this project have led me to conclude that the F.M.C.G companies
will not be able to survive without the help of advertisements. The findings also show
how much emphasis companies are showing towards advertisements of their products. To
conclude this project I will like to say that advertising is in no way a waste of money but
it is an investment towards the future prospects of the company. Every company should
advertise wittingly and considering all the prospects of advertising. In future we might be
able to see companies coming up with more innovative methods to advertise and
hopefully this will help them in creating a name for their products in the mind of the
Indian consumer.

I strongly recommend that companies should be more thoughtful towards their


advertising. The money invested should be utilized diligently and not just for the sake of
investing. The cola war is a strong example where both the companies were guilty of
misusing their funds. Innumerable amounts were spent to counter each other but to no
effect. Similar case lies with HLL and P&G. It should not happen that one should lose
focus of one’s objectives in rivalry but should be tactful in approach. As mentioned in the
project, high spending does not necessarily mean higher sales but it is smart spending that
will be able to attract consumers.

Overall it has been a learning experience to know in detail about this interesting topic and
in future hopefully consumers will get to see more ads featuring the F.M.C.G industry.

Recommendations:-
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1. News paper and T.V is the most effective media of advertisement in their segment,
but too much advertisement cause irritation and disliking in readers and viewers.

2. Almost 70% have T.V in their household it does not give the real information
about a product. Advertiser should give real in information.

3. Advertisements must not hide the fact about a product.

4. For a small and limited area pamphlet and poster is effective and cost media of
advertising.

5. Moral and Ethical value must be consider while deciding advertising media and its
layout.

6. Marketers should focus on some non- conventional media of advertisement like


internet, mobile, and e- commerce.

Limitation:-
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1. It is a consumer survey only.

2. The study based on the general survey so all the data is based on as filled by the
people in questionnaire.

3. It may vary from reality.

4. All the data is approximated.


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Source List:-
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1. Kotler, Philip : Marketing Management (Eleventh Edition).

2. Kothari : Marketing Research

3. www.googlesearch.com

Bibliography
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The following sources were utilized for collection of data for this project:

The internet medium was used for collecting the ads:

www.exchange4media.com

www.agencyfaqs.com

The following books have been used for reference:

Advertising management by Mr. Mahendra Mohan

Advertising management by Mr. R.S Rathore

Uncommon sense of advertising by Mr. Sanjay Tiwari

Fundamentals of Advertising by Mr. John Wilmshurst and Mr. Adrian Mackay

The following dailies and magazines were used:

Pitch magazine

The Economic Times of India

Business World

Financial Express

Annexure
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Questionnaire
Q1: Name: ……………………………………………….

Q2: Address: …………………………………………………

Q3: Education: Under Graduation Graduate

Post Graduation Other Specify……………….

Q4: Age Group: Teenager 20 to 30 30 to 40

40 and above

Q5: Income Level (annual):- Less than 1 lakh 1 lakh to 5 lakh

5 lakh and above

Q6: Household Items: - T.V Radio Telephone Computer

Computer with internet Mobile Phone

Cable Connection

Q7: Do you subscribe a newspaper?

Yes No

Q8: Do you subscribe a magazine?

Yes No

Q9: From where do you get information first about a new FMCG product? (Keep in order
of priority*)

T.V Newspaper Radio Internet Poster

Banner Billboard Pamphlet Mobile SMS

Direct mail other Specify………..

Q10: Contact no:______________________.

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