Chapter 1: INTRODUCTION

hapter 1: Introduction

What is Advertising?
Is a Multi dimensional activity.
It is a mega business by itself.
Is a form ofcommunicationused to
encourage orpersuadean audience
(viewers, readers or listeners)
to continue or take some new action.
Major players Advertisers,
Media,
Ad agencies,
Service providers.

hapter 1: Introduction

Definition for Advertising

Any paid form of non-personal communication of ideas,

by an identified sponsors.

Advertising presents the most persuasive possible selling m

right prospects for the product or service at the lowest poss

hapter 1: Introduction

Definition for Advertising

The purpose of advertising may also be to reassure employ

shareholders that a company is viable or successful.

Is the element of the marketing communication mix tha

paid for an identified sponsor, & disseminated through chan

mass communication to promote the adoption of goods, se

person or ideas.

hapter 1: Introduction

Definition for Advertising

Is one of the important forces which serve the public inter

It is a form of open communication between those who
who buy.

Advertisements: Influences on the behavior of target aud

hapter 1: Introduction

hapter 1: Introduction

In Advertising business we have Advertisers :

Public & private companies,
Small businesses,
Voluntary organization,
Retailers,
Distributors
like:

Mass medias

hapter 1: Introduction

hapter 1: Introduction

What is Marketing?

An organizational function and a set of processes for creatin

communicating, and delivering value to customers and for ma

customer relationships in ways that benefit the organization a

stakeholders.
IDENTIFY THE CUSTOMER,
SERVE THE CUSTOMER,
KEEP THE CUSTOMER.

hapter 1: Introduction

Advertise
rs

Ad.
Agency
The
service
providers

In Advertising world, Major players are:

Advertise

Media

hapter 1: Introduction

Thus Advertising is Business as well communica

hapter 1: Introduction

Origin and Milestones

Advertising is a measure of growth of civilization, indust

belongs to Modern industrial world, developing countrie

An indication of striving of human race for betterment an

The drive for Survival and satisfaction.

In past: Shop keeper had to shout his goods to passer

Early forms were:

Inn signs,
Red and white stripped barbers pole,
Wheelwrights wheel, etc,.

hapter 1: Introduction

Origin and Milestones [Continued.]

Need of advertising developed with the expansion of popul

shops, large stores,
mass production,
roads and railways to convey goods,
popular newspapers in which to advertise, etc.

Large quantities of goods being produced were made kno

of Advertising to unknown customers who lived far fro

of manufacturer.

This process developed some 200ys ago in industrialize

grew with the development of media, advertising agen

need of the customers, personalization, etc,.

hapter 1: Introduction

History of Indian Adver

Origin and Milestones [Continued.]
PERIOD
Pre-Independence of INDIA

CHARACTERISTICS
- Press Advertisements

1930s

- Radio emerge as media

1940s

- War years, Fight for

Independence

1950s

- Watershed years for

Advertising,
- Many Indian Industries came
up,
- Cinema ads began (2-3 min
films)
- Indias First Ad clubCalcutta (1956),
- Press Syndicate leading Ad

Ads in 1950s

hapter 1: Introduction

History of Indian Adver

Origin and Milestones [Continued.]
PERIOD

CHARACTERISTICS

1960s

-Indias first advertising convention/gathering

of people who share common interest (Calcutta1960), In this convention it was discussed:
Advertising should be Indian in thought and
content, Shift to marketing orientation,
Professionalization within agencies.
- Asian Advertising Congress at New Delhi,
- Research data were generated, MRI (market
rating indices), Shop audits, NRS (National
readership survey)
- creativity was emphasized
- Photography finds increasing use.
- social marketing (behavioral, social good, etc,.)

1970s

-Media boom
-Special magazines
-Asian advertising congress at New Delhi
-Life-style studies
-Positioning

Ads in 1960s

Ads in 1970s

hapter 1: Introduction

History of Indian Adver

Origin and Milestones [Continued.]
PERIOD

CHARACTERISTICS

1980s

- Indianisation though there is still western

execution
- Public sector advertising
- Expansion and diversification of agencies, TV,
Radio commercials,
- Formation of
-Indian Chapter of International Advertising
Association (ICIAA),
-Advertising Standard Council Of India (ASCI)
associations

1990s

-Niche magazine
-Emphasis on direct marketing
- Satellite TV
-FM radio
-Emphasis on brand equity
-Ads training facilities
-Consumer satisfaction studies

Ads in 1980s

Ads in 1990s

hapter 1: Introduction

History of Indian Adver

Origin and Milestones [Continued.]
PERIOD
2000s

CHARACTERISTICS
- Indias First Advertising and Marketing
gallery
-Media buying industry sprung up
-Online advertising

hapter 1: Introduction

Advertising in INDIA

Advertising lies at the junction where culture and the econom

The major environmental factors that impact on advertising a

the economy, demography, culture, the political and legal sys

Early ads were on hotels, four-wheelers, tea, gramophones, co

tailoring shops
Target audiences were Britishers, Princes, etc,.

hapter 1: Introduction

Advertising in INDIA
Economy aspects of advertising in India:
- 5 levels of spending power:
Very rich, Consuming class,Climbers, Aspirants and Destitute.
- Urban and Rural population

- It is an Investment directly proportional to the countrys stan

- It offers us a Choice optional limited resources- ex: Grow fat o

- It Rewards us after the monotonous routine- ex: holiday, garde

- It adds Psychic Values to the products- ex: car- luxury look, dis

- It creates Monopolies (who has large market share)- ex: Brand

- It can also break the monopolies

hapter 1: Introduction

Advertising in INDIA
Economy aspects of advertising in India:
- It also has great effect on Demandex: change in technology, social changes, etc,.

- It helps the declining product (in product life cycle) to recover.

- Its expenditure is axed whenever there is a recession.
- It simulates competition.

- It fosters a healthy economy with consumers who are better in

and educated, more refined in exercising their choices.

hapter 1: Introduction

Advertising in INDIA
Demography aspects of advertising in India:

- age, generation, sex, marital status, family size, occupation and

level of education

- commonly used for differentiating target markets, easily measu

are strong predictors of consumer preferences and usage rates.

hapter 1: Introduction

Advertising in INDIA
Cultural aspects of advertising in India:
Cross cultural advertising effects everything we do.
Language is very important in the advertising campaign.
Colors, numbers, symbol, images. Also important.
Family oriented, hierarchical, religion, ..

hapter 1: Introduction

Advertising in INDIA

Social and ethical aspects of advertising in India:

- social responsibility is closely related to advertising ethics.

- growing number of ads which use an informal, colloquial copy,

- maintain the dignity of our language, culture, etc.

- However, advertisers feel that the copy uses expressions best

and understood by the target audience for whom the product i

- It is also accused of creating materialistic demands for things,
- It should motivate and create a force to satisfy our novel/new

- Excessive advertising is good to lead a better standard of livin

- Some ads may be offensive/in bad taste but can be accepted d

on the culture & lifestyle. They should not be used indiscrimina

hapter 1: Introduction

Advertising in INDIA
Social and ethical aspects of advertising in India:

- It should not convey false impression, incomplete information

- It should not compare, it may mislead.

- Bodies like Advertising Standards Council of India (ASCI) entert

complaints about misleading ads.
- Ads should not violate any law.
- Most of todays ads consists of working women.

hapter 1: Introduction

ROLE OF ADVERTISING
Explicit Role of Advertising :

a. Role as a guide to prospective buyers, propensity to c

b. It effects on primary & selective demand
c. Product differentiation
d. Encouragement on innovation
e. Financial support to the media

Demand curve

Product Differentiation

hapter 1: Introduction

ROLE OF ADVERTISING
Indirect Role of Advertising :
- Efficiency of production & distribution
- Lowering the prices,
- economic well being
- improvements in product quality
- finally in its contribution to national income

hapter 1: Introduction

ROLE OF ADVERTISING in Marketing Mix

Marketing Mix

- Themarketing mixis a business tool used inmarketing

- 4 Ps Product, Price, Place and Promotion

Marketing Mix and Promotion Mix

hapter 1: Introduction

Marketing Communication Mix

hapter 1: Introduction

ROLE OF ADVERTISING in Marketing Mix

Advertising is the tool of marketing.

Employed to highlight the benefits of products/service.

But advertising never decide, how a product should be made,
distributed and at what price.

These above decisions should be made before advertising play

Marketing has to keep the needs and wants of consumers in fo

It has to access their needs through market research.

Consumer needs can be met by managing 4 variables in the

Marketing has to have all these 4 Ps in combinations or in

Advertising efforts must essentially be integrated with the res

marketing plan variables.

hapter 1: Introduction

ROLE OF ADVERTISING in Marketing Mix continued

Product:
- Physical entity, service, person, idea, place etc.
- Its not just a characteristics, but should add beneficial value

- Advertisements should highlight the features and benefits o

- It facilitates the choice of customers by allowing them to cho

available products those which suit their needs and wants.

- A brand is created to give assurance & guarantee better than

- Verbal portion of brand is brand name and visual portion is
- Every Product has its own life cycle.
- Advertising should highlight the superiority of a firms brand

over other brands or products and also seeks to enhance awa

knowledge of new uses.

hapter 1: Introduction

ROLE OF ADVERTISING in Marketing Mix continued

Product - Packaging
- It is an important part of marketing mix.

- It is the most powerful aids to selling as there is constant co

the customers attention.
- Packaging serves as an advertisement for the product.

hapter 1: Introduction

ROLE OF ADVERTISING in Marketing Mix continued

Price

- Its a value offered in exchange of products in terms of mone

- It covers cost of manufacturing a product, cost of office and
cost of distribution and cost of promotion.
- It also includes mark up over cost called profit.
- It is used as a promotional tool in price-sensitive market like

- Price and quality are inter related. A Premium quality produc

- Pricing strategy can be skimming or penetrative to sustain in

- Most of the advertisements do mention prices.

- When firm develops a prestige product at a high price, adver

emphasizes its high quality, image and prestige.

hapter 1: Introduction

ROLE OF ADVERTISING in Marketing Mix continued

Distribution (Place)

- Movement of product from producer to consumer is called dis

- It is made possible by using Marketing channels

manufacturer to whole seller to retailers to cus

- Physical distribution involves transportation, warehousing a

- Advertising creates PULL demand, mentions where the produc

- All advertising decisions are coordinated with distribution dec

advertising creates demand and if product is not available, its

of advertising budget. And of course a bad mark for the comp

- Distribution also creates an image that is consistent & similar

consciously by promotion. Ex: Few products available only at se

hapter 1: Introduction

ROLE OF ADVERTISING in Marketing Mix continued

Promotion
- It is a technique of communication.

- Advertising is a part of promotion which is used along with p

public relations, direct marketing and sales promotion.

- Personal selling and advertising have to work together. Adv

magazines & newspapers may provide leads and enquiries w

can follow. Similarly, a salesman may bring to the attention o

dealers to help they receive in their marketing efforts from ad

An advertising exposure costs much less than persona

- Consumers can be offered premiums, concessions, coupons a

window displays, special deals, Point of sale (POS), Point of p

hapter 1: Introduction

ADVERTISING AS A TOOL OF COMMUNICATION

Encod
Decodi
Encode
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s
the
SENDE
Messa
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Messa
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Messa
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NOISE
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ER

hapter 1: Introduction

ADVERTISING AS A TOOL OF COMMUNICATION

con

Here advertiser is the source, who transmits the message wh

through an appropriate medium like press, TV, radio or maga

The message is decoded meaningfully
Ultimately received by the target audience for whom product
is meant.

The response of the message is known by receiving the feedb

recipient of the communication.

The communication sometimes fails to accomplish its purpose

an appropriate response or understanding when the messag

noise elements.

Noise may include poor message planning, busy audience, car

hapter 1: Introduction

ADVERTISING AS A TOOL OF COMMUNICATION

con

The message must accomplish three tasks in order to be effec

1. It must gain the attention of the receiver.
2. It must be understood.

3. It must stimulate the needs of the receiver and suggest app

method to satisfy these needs.
Since the sender wants receiver to understand the message,

know as much as possible about the receiver before designin

Always an effective communication is due to less noise.

The ultimate aim of advertising is to make target audience fav

to the product/service.

Therefore its not just a communication, but marketing commu

Intern its a mass communication, since its received by large p

hapter 1: Introduction

KINDS OF ADVERTISING

Classified on the basis of four different criteria

1. Target audience
2. Graphical area
3. Medium
4. Purpose

Kinds of
Advertisin
g
Target
Audience
Consume
r
Produ
ct

Servic
e

Pione
er
Competiti
ve
Retenti
ve

Geograph
ical area

Medium

Business
Industri
al
Trade
Professio
nal
Agricultur
al

Purpose
Public
relation
Public
service
Financi
al

hapter 1: Introduction

KINDS OF ADVERTISING
Target Audience

- They are the particular group of people to whom the ad

- Sometimes, we come across ads which does not appeal
meant for some other group.

- Ex: Baby cream, stress guard capsules, etc not meant fo

Advertisement broadly cater to two types of target audiences:
1.Consumer Advertising Meant for consumers.
2.Business Advertising - concentrated in trade and
business publication

KINDS OF ADVERTISING

continued.

1. Consumer Advertising Meant for consumers.

- Ads Sponsored by manufacturer or dealers who sell the
products.
- Goods can be Fast moving consumer goods like tea,
soaps, soft drinks, pens, pencils, etc or durables like ACs,
refrigerators, etc which are not brought frequently.
- Consumer durables belong to White goods, brown goods,
computers,
automotives and domestic/small appliances.
- white goods heavy electronics- ACs, refrigerators,
washing machines,.
- brown goods light electronics- TVs, tape decks, radios.

KINDS OF ADVERTISING

continued.

1. Consumer Advertising 1a. Product Advertising

- Advertising does not add intrinsic value to the product!
(bad product cannot be sold with any efforts of marketing
or advertising!)
- It may help in achieving initial sales but in long run,
success depends on
customer satisfaction with the product..
- The product or brand strategy plays a very important role
in product positioning.
- The other elements in planning for effective advertising
for a product are: Packaging, trade mark, taste, color,
texture, aroma, style and design.

KINDS OF ADVERTISING

continued.

1. Consumer Advertising a. Product Advertising

continued.
- To be successful, an advertiser should create a niche in
prospects mind.
- Niche involves- strength, benefits, needs, difference from
competitors.
Three types of product advertising:
i. Pioneering Advertising: An attempt is made to
stimulate the primary demand for the product.
Good at the introductory stage of product life cycle.
The product category/technology is first introduced.

Pioneering advertising

ii. Competitive Advertising:

Selective demand for a specific product is stimulated.
Product is already established, grown & reached maturity phase
in the market.
Also called as Persuasive product advertising

Competitive advertising

iii. Retentive Advertising:

The product is now having a firm footing in the market.
Its sales may start declining later.
The buyer must reminded about the product to sustain his
loyalty.
It is a soft-sell approach where the buyer is nudged to
continue the usage of the product.
Also called as reminder oriented product advertising.

KINDS OF ADVERTISING

continued.

1. Consumer Advertising b. Service Advertising

- They are activities, benefits, satisfactions offered for sale.
- They are intangible, inseparable, variable and perishable.
- They require strict quality control, supplier credibility and
adaptability
- Personalized services, when advertised plays a greater
emphasis on the institution offering it. They may talk about
congenial environment, quickness and promptness of
services, economy, exclusiveness, status significance, etc.
- Ex: Airlines, life insurance, banks, beauty salon, etc
attach greater importance to service with smile,
courtesy, thoughtfulness, homeliness, teller system

KINDS OF ADVERTISING

continued.

2. Business Advertising
- It is much smaller and concentrated in trade and business
publications and technical magazines. Even direct mail is
used as a media.
- Four types:
a. Industrial advertising
b. Trade advertising
c. Professional advertising
d. Agricultural advertising

KINDS OF ADVERTISING

continued.

2. Business Advertising a. Industrial advertising

- Meant for individuals in the business, who influence the
purchase decision of the industrial products used to
manufacture other goods.
- Industrial products: machineries, plant, equipments, raw
materials, semi manufactured components, other goods,
etc.,
- Industrial services: insurance, accountancy, warehousing,
maintenance,
- Purchasing happens in a very elaborate process which will
be affected by many variables. Advertising is thus very
complicated.
- Common objectives of these advertisements: To inform, to

KINDS OF ADVERTISING

continued.

2. Business Advertising b. Trade advertising

- Its purpose is to stimulate greater distribution by
increasing the number of outlets who stock the product or
by promoting better stocking of the existing distributors.

KINDS OF ADVERTISING

continued.

2. Business Advertising c. Professional advertising

- These are meant for professionals like doctors,
accountants, lawyers, architects and engineers.
- Media: Professional journals
- It persuade the professionals to use the product for them.
Or to recommend it to others.

hapter 1: Introduction

KINDS OF ADVERTISING

Classified on the basis of four different criteria

1. Target audience
2. Graphical area
3. Medium
4. Purpose

KINDS OF ADVERTISING

continued.

Geographic Area
- Ads on local neighborhood stores, mass retailers, services,
office, etc..
-

The ads are restricted to local medias, tabloids, local

edition of newspaper, magazines.

Bigger firms use regional, national or international

advertising, depending on market they serve and nature
of their product.

Many international brands have invaded India, where

they keep message same, but change the execution.

- Their thinking is global but act local.

hapter 1: Introduction

KINDS OF ADVERTISING

Classified on the basis of four different criteria

1. Target audience
2. Graphical area
3. Medium
4. Purpose

KINDS OF ADVERTISING

continued.

Medium
- Based on which the advertisement is carried
-

Ex: Print advertisements (magazines, newspapers)

broadcast advertising (radio), TV and Cinema

advertising,

outdoor advertising (hoardings, billboards, posters)

- The medium is paid to carry these advertisement

message to the target audience.

hapter 1: Introduction

KINDS OF ADVERTISING

Classified on the basis of four different criteria

1. Target audience
2. Graphical area
3. Medium
4. Purpose

KINDS OF ADVERTISING

continued.

Purpose
- On the basis of objectives it seeks to achieve.
- Mostly ads try to improve the market shares, sales of
products and services.
- They even try to create an awareness about the product,
remind the audience repeatedly, promote ideas, social
causes.

KINDS OF ADVERTISING

continued.

Other types
- Institutional and corporate advertising

KINDS OF ADVERTISING
Other types
- Public relations advertising

continued.

KINDS OF ADVERTISING
Other types
- Public service advertising

continued.

KINDS OF ADVERTISING
Other types
- Financial advertising

continued.

Kinds of
Advertisin
g
Target
Audience
Consume
r
Produ
ct

Servic
e

Pione
er
Competiti
ve
Retenti
ve

Geograph
ical area

Medium

Business
Industri
al
Trade
Professio
nal
Agricultur
al

Purpose
Public
relation
Public
service
Financi
al

END OF THE CHAPTER