Advertising As A Management

Function
The Growth of Advertising
and Promotion
 Advertising and promotion are an integral part of our
social and economic systems.
 In our complex society, advertising has evolved into a
vital communications system for both consumers and
businesses.
 The ability of advertising and other promotional
methods to deliver carefully prepared messagesto target
audiences has given them a major role in the marketing
programs of most organizations.
The Growth of Advertising
and Promotion
 Both foreign and domestic companies spend billions more on sales
promotion, personal selling, direct marketing, event sponsorships,
and public relations, all important parts of a firm’s marketing
communications program.
 The growth in promotional expenditures also reflects the fact that
marketers around the world recognize the value and importance
of advertising and promotion.
 Promotional strategies play an important role in the marketing
programs of companies as they attempt to communicate with and
sell their products to their customers.
To understand
the roles advertising and promotion
play in the marketing process, let us
first
examine the marketing function.
What Is Marketing?
The process of planning and executing the conception,
pricing, promotion, and distribution of ideas, goods, and
services to create exchanges that satisfy individual and
organizational objectives.
Marketing Focuses on Exchange
 Exchange is a central concept in marketing.
 For exchange to occur, there must be two or more
parties with something of value to one another, a desire
and ability to give up that something to the other party,
and a way to communicate with each other.
 Advertising and promotion play an important role in the
exchange process by informing consumers of an
organization’s product or service and convincing them of
its ability to satisfy their needs or wants.
Relationship Marketing
 Today, most marketers are seeking more than just a one-
time exchange or transaction with customers.
 The focus of market-driven companies is on developing
and sustaining relationships with their customers.
 This has led to a new emphasis on relationship
marketing, which involves creating, maintaining,
and enhancing long-term relationships with individual
customers as well as other stakeholders for mutual
benefit
Factors Effecting Relationship
Marketing
 Customers have become much more demanding.
 Consumers desire superior customer value, which includes
quality products and services that are competitively
priced, convenient to purchase, delivered on time, and
supported by excellent customer service.
 They also want personalized products and services that
are tailored to their specific needs and wants.
Factors Effecting Relationship
Marketing
Advances in information technology, along with flexible
manufacturing systems and new marketing processes,
have led to
 mass customization, whereby a company can
make a product or deliver a service in response to a
particular customer’s needs in a cost-effective way.
 New technology is making it possible to configure and
personalize a wide array of products and services
including computers, automobiles, clothing, golf clubs,
cosmetics, mortgages, and vitamins.
Factors Effecting Relationship
Marketing
 Consumers can log on to websites such as MattelInc.’s
barbie.com and design their own Barbie pal doll or
Fingerhut’s myjewelry.com to design their own rings.
 Technological developments are also likely to make the
mass customization of advertising more practical as well.
The Marketing Mix
 Marketing facilitates the exchange process and the development of relationships by
carefully examining the needs and wants of consumers, developing a product or service
that satisfies these needs, offering it at a certain price, making it available through a
particular place or channel of distribution, and developing a program of promotion or
communication to create awareness and interest.
 These four Ps—product, price, place (distribution), and promotion—are elements of
the marketing mix.
 The basic task of marketing is combining these four elements into a marketing program
to facilitate the potential for exchange with consumers in the marketplace.
 The promotional program must be part of a viable marketing strategy and be
coordinated with other marketing activities. A firm can spend large sums on advertising
or sales promotion, but it stands little chance of success if the product is of poor quality,
is priced improperly, or does not have adequate distribution to consumers.
Many companies also
recognize the need to integrate their
various marketing communications
efforts, such
as media advertising, direct marketing,
sales promotion, and public relations, to
achieve more effective marketing
communications.
 Integrated Marketing Communications
 Involves coordinating the various promotional elements and
other marketing activities that communicate with a firm’s
customers.
 a concept of marketing communications planning that
recognizes the added value of a comprehensive plan that
evaluates the strategic roles of a variety of communication
disciplines.
Example, general advertising, direct response, sales
promotion, and public relations—and combines these
disciplines to provide clarity, consistency, and maximum
communications impact.*
Integrated Marketing Communications
 The IMC approach helps companies identify the most
appropriate and effective methods for communicating
and building relationships with their customers as well as
other stakeholders such as employees, suppliers,
investors, interest groups, and the general public.
 IMC is one of the ―new-generation‖ marketing
approaches being used by companies to better focus their
efforts in acquiring, retaining, and developing
relationships with customers and other stakeholders.
Integrated Marketing Communications
 Messages can originate at three levels—corporate,
marketing and marketing communications—since all of a
company’s corporate activities, marketing-mix activities
and marketing communications efforts have
communication dimensions and play a role in attracting
and keeping customers.*
IMC approach is the ongoing
revolution that is changing
the rules of marketing and the role of
the traditional advertising agency.
Characteristics of marketing revolution
for IMC
 Many marketers feel that traditional media advertising has become
too expensive and is not cost-effective . Also, escalating price
competition in many markets has resulted in marketers’ pouring
more of their promotional budgets into price promotions rather
than media advertising.
 Many companies are turning to lower-cost, more targeted
communication tools such as event marketing and sponsorships,
direct mail, sales promotion, and the Internet as they develop their
marketing communications strategies.
 Characteristics of marketing revolution
for IMC
 Due to consolidation in the retail industry, small local
retailers are being replaced by regional, national and
international chains. These large retailers are using their
clout to demand larger promotional fees and allowances
from manufacturers, a practice that often siphons money
away from advertising. Moreover, new technologies such as
checkout scanners give retailers information on the
effectiveness of manufacturers’ promotional programs. This
is leading many marketers to shift their focus to promotional
tools that can produce short-term results, such as sale
promotion.
Characteristics of marketing revolution
for IMC
 Many companies are building databases containing
customer names; geographic, demographic, and
psychographic profiles; purchase patterns; media
preferences; credit ratings; and other characteristics.
 Marketers are using this information to target consumers
through a variety of direct-marketing methods such as
telemarketing, direct mail, and direct-response
advertising, rather than relying on mass media.
 Vast Use Of Internet.
IMC
 The basic tools used to accomplish an organization’s communication objectives
are often referred to as the promotional mix.
 Each element of the promotional mix is viewed as an integrated marketing
communications tool that plays a distinctive role in an IMC program.
Advertising
 Defined as any paid form of nonpersonal communication about an
organization,product, service, or idea by an identified sponsor.
 The paid aspect of this definition reflects the fact that the space or
time for an advertising message generally mustbe bought.
 An occasional exception to this is the public service
announcement (PSA),whose advertising space or time is donated
by the media.
Advertising
 The non personal component means that advertising involves mass media (e.g.,TV, radio,
magazines, newspapers) that can transmit a message to large groups of
individuals , often at the same time. The non personal nature of advertising
means that there is generally no opportunity for immediate feedback from the
message recipient (except in direct-response advertising). Therefore, before the
message is sent, the advertiser must consider how the audience will interpret
and respond to it.
 Advertising is the best-known and most widely discussed form of promotion,
probably because of its pervasiveness.
 Advertising can be used to create brand images and symbolic appeals for a
company or brand, a very important capability for companies selling products
and services that are difficult to differentiate on functional attributes.
 Advertising
 Creative advertising has made Absolut the most popular brand of imported vodka in
the United States.
 Eveready uses the popularity of its pink bunny campaign to generate support from
retailers.
Advertising
 Another advantage of advertising is its ability to strike a
responsive chord with consumers when differentiation
across other elements of the marketing mix is difficult to
achieve.
 Popular advertising campaigns attract consumers’
attention and can help generate sales.
Advertising
 The nature and purpose of advertising differ from one
industry to another and/or across situations.
 One advertiser may seek to generate immediate response
or action from the customer; another may want to
develop awareness or a positive image for its product or
service over a longer period (eg. Amul Doodh Pita Hay
India).
Classification Of Advertising

 Adertising To Consumer Markets

1. National Advertising
 Advertising done by large companies on a nationwide basis or in most regions
of the country. Most of the ads for well-known companies and brands that are
seen on prime-time TV or in other major national or regional media are
examples of national advertising. The goals of national advertisers are to inform
or remind consumers of the company or brand and its features, benefits,
advantages, or uses and to create or reinforce its image so that consumers will
be predisposed to purchase it.
Classification Of Advertising
2. Retail/Local Advertising
 Advertising done by retailers or local merchants to encourage consumers to
shop at a specific store, use a local service, or patronize a particular
establishment. Retail or local advertising tends to emphasize specific patronage
motives such as price, hours of operation, service, atmosphere, image, or
merchandise assortment. Retailers are concerned with building store traffic, so
their promotions often take the form of direct-action advertising designed to
produce immediate store traffic and sales.
 Classification Of Advertising
3.Primary- versus Selective-Demand Advertising
 Primary-demand advertising is designed to stimulate demand for the general product class or
entire industry. Selective-demand advertising focuses on creating demand for a specific
company’s brands. Most advertising for products and services is concerned with stimulating
selective demand and emphasizes reasons for purchasing a particular brand. An advertiser
might concentrate on stimulating primary demand when, for example, its brand dominates a
market and will benefit the most from overall market growth. Primary-demand advertising is
often used as part of a promotional strategy to help a new product gain market acceptance,
since the challenge is to sell customers on the product concept as much as to sell a particular
brand. Industry trade associations also try to stimulate primary
 demand for their members’ products, among them cotton, milk, orange
 juice, pork, and beef.
Classification Of Advertising
 ADVERTISING TO BUSINESS AND
PROFESSIONAL MARKETS
1. Business-to-Business Advertising
 Advertising targeted at individuals who buy or influence the purchase of industrial goods
or services for their companies. Industrial goods are products that either become a
physical part of another product (raw material or component parts), are used in
manufacturing other goods (machinery), or are used to help a company conduct its
business (e.g., office supplies, computers). Business services such as insurance, travel
services, and health care are also included in this category.
Classification Of Advertising
2. Professional Advertising
 Advertising targeted to professionals such as doctors, lawyers, dentists,
engineers, or professors to encourage them to use a company’s product in their
business operations. It might also be used to encourage professionalsto
recommend or specify the use of a company’s product by end-users.
3.Trade Advertising
 Advertising targeted to marketing channel members such as wholesalers,
distributors, and retailers. The goal is to encourage channel members to stock,
promote, and resell the manufacturer’s branded products to their customers.
Role Of Advertising
Why Advertise:
 Make An Impact.
 Create Awareness.
 Communicate Message
 Create Favourable impression
 Remind Consumers
 Fulfil Needs
 Change Perceptions
Role Of Advertising
Branding Role:
 To make the brand respected and sought after, using values such as humour,
heritage, credibility ,fashionability , sociability and strength.
Persuasion Role :
 To heighten consciousness of a cause and raise an audience to a state of frenzy
and conviction.
Disarming Role:
Modern Society knows that advertising has to be truthful. This does not prevent
consumers for being sceptical about product claims. They feel they have to
right to be critical, to argue and to reject. This bought sharply into focus an
overlooked role-Disarming Role.
Role Of Advertising
Disarming Role:
There are certain areas of marketing where cynical attitude prevails
amongst the customers:
 Addressing Male audience with technical claims.
 Making Financial Investment claims.
 Making public services like Indian Railways is efficient. Indian Railways claims
cleanliness which has a cynical response of ―so what. I have never seen it‖.
 The trick is to charm people into believing, and the best way to alter opinions is
not by confrontation and belligerence but by gentle persuasion-making people
want to believe.
Role Of Advertising
Reassurance Role:
This is one of the most important and most underestimated role of advertising.
There are several aspects of this role:
• Big safe brands advertise more than small untried ones and consequently
provide more assurance.
• Expensively produced advertisements can lead to status and respectability in the
market where this is relevant. E.g. Cars, Jewelleries.
• Justifying a premium price witness the growth in the premium sector.
• Justifying a lower price on the other side of the coin provides reassurance the
product is not of lower quality .e.g. KFC.
Role Of Advertising
Social Targeting Role:
Here the role of advertising is to link a brand with a particular consumer target.
Advertising thus provides a means of Social Identity.
Wish-Fulfilment Role:
Product s does not exist in vacuum; they fit into people’s life. Therefore it is
important to understand a product category. How it is used? What people want
from it? How they feel when they are using it.
 This examination leads inevitably to the issue of realism and fantasy in
advertising as people need both in their life.
 This is why makers of coffee and chocolate resort to aspirational fantasy.
Role Of Advertising
Non Condescending Role:
o Consumers like to be treated equal by the advertise. They do not want their
intelligence to be insulted.
o Many advertisers misunderstand this fundamental role.
o Neither do the consumers deserve to be patronised. eg. Many airlines feel
people have not flown and glamorise their advertisement. The truth is most air
travellers find their experience boring. The service as plastic as food and non
conventional seats more comfortable for long distance travel.
Role Of Advertising
Pioneering Role:
o Developing new style in advertising which places consumers in a state of
dilemma.
o On one hand they want their imaginations stretched; on the other hand their
innate conservatism leads them to believe that the normal is right and unusual is
wrong.
o Nowadays consumers show a more open acceptance of unconventional styles
and the planner should encourage movement away from the safe option.
Role Of Advertising
Stylistic Role:
Consumers nowadays are advertising literate. The feel that if the
advertisements can intrude through their television, radio or daily newspaper,
then they have every right to criticise the advertising. The paying consumer have
every right to comment upon the performance. Thus, making a likeable
advertisement is as important to the audience as communicating a relevant
message. More and more it is becoming a case of the style is the advertisement;
and how the effect is achieved is becoming more important than what is actually
said.
Criticism Of Advertising
Advertising is a form of communication for marketing and used to encourage
or persuade an audience (viewers, readers or listeners) to continue or take some
new action.

= Most commonly, the desired result is to drive consumer behavior with

respect to a commercial offering.

Tv

magazine

Newspaper advertise
Advertising messages are usually paid for by sponsors and
viewed via various traditional media.

Commercial advertisers often seek to generate

increased consumption of their products or
services through "branding," which involves
the repetition of an image or product name
in an effort to associate certain qualities with
the brand in the minds of consumers.

In 2010, spending on advertising was

Estimated $467
billion worldwide.
While advertising can be seen as necessary
for economic growth,
it is not without social costs.

Unsolicited commercial email and other

forms of spam have become so
prevalent that they have become a major
nuisance to users of these services,
as well as being a financial burden on
internet service providers.
Critics can refer to advertising's audio-visual
aspects.

As advertising has become prevalent in

modern society, it is increasingly
being criticized.

Advertising occupies public space and more

and more invades the private sphere of
people.
Criticism Of Advertising
 A common criticism of advertising, and TV commercials
in particular, is that so much emphasis is placed on
creative execution that the advertiser’s message gets
overshadowed. Many creative, entertaining commercials
have failed to register the brand name and/or selling
points effectively. E.g.. ―Most people who buy computers don’t even know that
chip is there. They care about the performance of the computer. It really doesn’t matter
what the chip is.‖ Well, some may still not know exactly what a microprocessor chip
does, but apparently it does matter if there is an ―Intel Inside.‖
Criticism Of Advertising
 Specific techniques used by advertisers are criticized as deceptive
or untruthful, offensive or in bad taste, and exploitative of certain
groups, such as children.
 Ads are offensive, tasteless, irritating, boring, obnoxious, and so
on. Eg. Some object when a product or service like contraceptives or personal
hygiene products is advertised at all.
 The advertising appeals that have received the most criticism for
being in poor taste are those using sexual appeals and/or nudity.
 Criticism Of Advertising
 In recent years there has been an increase in what is often referred to as shock
advertising, in which marketers use nudity, sexual suggestiveness, or
other startling images to get consumers’ attention.eg. Calvin Klein, Airwalk.
 While a number of factors influence the cultural values, lifestyles, and behaviour of a
society, the overwhelming amount of advertising and its prevalence in the mass
media lead many critics to argue that advertising plays a major role in influencing
and transmitting social values.
 Advertising has received much criticism for stereotyping women and failing to
recognize the changing role of women in our society. Critics have argued that
advertising often depicts women as preoccupied with beauty, household duties, and
motherhood or shows them as decorative objects or sexually provocative figures.
 African-Americans and Hispanics have also been the target of stereotyping in
advertising.
Criticism Of Advertising
Advertising Encourages Materialism: Many critics claim advertising
has an adverse effect on consumer values by encouraging materialism.
 Seeks to create needs rather than merely showing how a product or service
fulfils them.
 Surrounds consumers with images of the good life and suggests the acquisition
of material possessions leads to contentment and happiness and adds to the joy
of living.
 Suggests material possessions are symbols of status, success, and
 accomplishment and/or will lead to greater social acceptance,
popularity,appeal, and so on.
Social And Economic Effects Of
Advertising
Proponents Critics

 Provides information.  Creates needs and faults

 Encourages a standard of  More propaganda than
living improvement information.
 Produces jobs  Promotes Materialism.
 Promotes competition
Social And Economic Effects Of
Advertising
Ethics: Moral principles and values that govern the actions of and
individual or group individual group.
 Not all issues can be regulated
 A marketing or promotion action may be legal but not considered
ethical
 Marketers must make decisions regarding the appropriateness of
their actions
 Companies are scrutinized for their ethics
 Social And Economic Effects Of
Advertising

 Advertising as untruthful or deceptive.

 Advertising as offensive or in bad taste
–Advertising of personal products
–Sexual appeals
 Advertising and Children
 Social and Cultural Consequences
–Making people buy things they don’t need
–Encouraging materialism
–Stereotyping
–Advertisings’ influence on the media
 Social And Economic Effects Of
Advertising
 Advertising as untruthful or deceptive
–General mistrust of ads
–Deliberately untruthful or misleading vs. Puffery
–Problems often more at local level rather than national.
 Advertising as offensive, in bad taste, or irritating
 –Advertising of personal products
 –Sexual appeals
 Suggestive, demeaning, raunchy
 Shock advertising
 Social And Economic Effects Of
Advertising
ADVERTISING PRINCIPLES

 1.Truth:Advertising shall reveal the truth, and shall reveal significant facts, the
omission of which would mislead the public.
 2. Substantiation: Advertising claims shall be substantiated by evidence in
possession of the advertiser and the advertising agency prior to making such claims.
 3. Comparisons: Advertising shall refrain from making false, misleading, or
unsubstantiated statements or claims about a competitor or his products or service.
 4. Bait advertising: Advertising shall not offer products or services for sale unless
such offer constitutes a bona fide effort to sell the advertised products or services
and is not a device to switch consumers to other goods or services, usually higher
priced.
 Social And Economic Effects Of
Advertising
ADVERTISING PRINCIPLES
 Guarantees and warranties: Advertising of guarantees and warranties shall be
explicit, with sufficient information to apprise consumers of their principal terms
and limitations or, when space or time restrictions preclude such disclosures, the
advertisement shall clearly reveal where the full text of the guarantee or warranty
can be examined before purchase.
 6. Price claims: Advertising shall avoid price claims that are false or misleading, or
savings claims that do not offer provable savings.
 7. Testimonials: Advertising containing testimonials shall be limited to those of
competent witnesses who are reflecting a real and honest opinion or experience.
 8. Taste and decency:Advertising shall be free of statements, illustrations, or
implications that are offensive to good taste or public decency.
 Social And Economic Effects Of
Advertising
Some studies have shown…
 Children lack experience and knowledge to evaluate advertising critically.
 They can not differentiate between commercials and program (fantasy vs.
reality).
 Children are vulnerable to advertising

……while other studies argue

 Children must learn through the consumer socialization process; need to
acquire skills to function in the marketplace
 Acquired skills have helped teens evaluate ads and recognize persuasion
techniques
 Social And Economic Effects Of
Advertising
Advertising makes people buy things they don’t need
 Advertising may encourage materialism .
 Information versus persuasion dichotomy
 Does advertising really have that much power?
 Freedom of choice
Portrayal of women Portrayal women
 Gender stereotyping
 Portrayal of women for sensual appeal.
 Role portrayal of women to reflect changing role in society
 Blacks and Hispanics
 Elderly
 Social And Economic Effects Of
Advertising
Arguments supporting advertiser control of the
media
 Advertising pays the bills therefore they exert influence on the
character , content, and coverage of certain issues.
Arguments against advertiser control of the media
 To retain public confidence the media must report the news fairly
and accurately.
 Advertisers need the media more than the media needs any
particular advertiser.
 Economic Effects Of Advertising
Effects on consumer choice :
 Differentiation
 Brand loyalty
Effects on competition:
 Barriers to entry
 Economies of scale
Effects on product costs and prices:
 Advertising as an expense
 Increased differentiation
 What is Advertising’s Role in the Economy?
Advertising = Market Power
 Advertising affects consumer
preferences and tastes, changes
product attributes, and
differentiates the product from
competitive offerings.
 Consumers become brand loyal and
less price sensitive and perceive
fewer substitutes for advertised
brands.
Advertising = Information
 Advertising informs consumers
about product attributes but does
not change the way they value
those attributes.
 Consumers become more price
sensitive and buy best ―value.‖Only
the relationship between price and
quality affects elasticity for a given
product.
 What is Advertising’s Role in the Economy?
Barriers To Entry
Advertising = Market Advertising=Information
Power
 Advertising makes entry
 Potential entrants must possible for new brands
overcome established brand because it can communicate
loyalty and spend relatively product attributes to
more on advertising. consumers.
Advertising Helps to Enter New Market
 What is Advertising’s Role in the Economy?
Industry structure and market power

Advertising = Market Power Advertising = Information

 Firms are insulated from  Consumers can compare

market competition and
potential rivals;
concentration increases,
leaving firms with more
discretionary power.
competitive offerings easily
and competitive rivalry
increases. Efficient firms
remain, and as the
inefficient leave, new
entrants appear; the effect
on concentration is
ambiguous.
 What is Advertising’s Role in the Economy?
Market Conduct

Advertising = Market Power Advertising = Information

 Firms can charge higher  More informed consumers

prices and are not as likely
to compete on quality or
price dimensions.
Innovation may be
reduced.
pressure firms to lower
prices and improve quality;
new entrants facilitate
innovation.
 What is Advertising’s Role in the Economy?
Market Performance

Advertising = Market Power Advertising = Information

 High prices and excessive  Industry prices decrease.

profits accrue to The effect on profits due to
advertisers and give them increased competition and
even more incentive to increased efficiency is
advertise their products. ambiguous.
Output is restricted
compared with conditions
of perfect competition.
Do You Agree With Leo Burnett?

 “It must be said that without advertising we would have a far

different nation, and one that would be much the poorer-not merely
in material commodities, but in the life of the spirit.”

These excerpters are from a speech given by Leo Burnett on the American
Association or Advertising Agencies’ 50th anniversary, April 20,1967
Advertisement Objective

Types Stage Objectives

Informative When new To Build

Advertising product is Primary
introduced Demand
Persuasive When To build
Advertising competition demand
comes in

Reminder When achieves To keep

Advertising the Maturity consumer
thinking about
the product
Allocation of the promotion budget

Direct Marketing/POP/
Radio. Misc.
2.6% 6.6%
TV.
39.8%
PR
14.3%

Print.
36.7%
Effect of
advertising on consumers:
movement from awareness
THE DAGMAR
APPROACH
Define
Advertising
GOAL for
Measuring
Advertising
Result
 GOALS

The goals may pertain to sales, image, attitude and

awareness. Some of the goals are:

Persuade a prospect to visit a show room & ask for a

demonstration.

Build up the moral of the company’s sales force.

Facilitate sales by correcting false impression, misinformation &

other obstacles.

Provide information regarding benefits & superior features of brand.

Communication Task
 Involvement
High Low

Sustain current levels Refine awareness

of awareness
HIGH

Awareness Build awareness Create association of

quickly. awareness of product
with product class
LOW need
 Awareness:
 Awareness of the existence of a product or organization is necessary
before the purchase behavior can be expected.
 Once the awareness has been created in the target audience, it should
not be neglected. If there is neglect, the audience may become
distracted by competing messages and the level of awareness of focus
product or organization will decline.
 Awareness needs to be created, developed, refined or sustained,
according to the characteristics of the market and the particular
situation facing an organization at any one point of time.
 Comprehension
 Awareness on its own may not be sufficient to stimulate a purchase.
Knowledge about the product or the organization is necessary. This can
be achieved by providing specific information about key brand
attributes.
 In attempting to persuade people to try a different brand of water, it may be
necessary to compare the product with other mineral water products and provide
an additional usage benefit, such as environmental claims.
 The ad of Ganga mineral water, featuring Govinda, which banked on the purity
aspect.They related the purity of the water with that of river Ganga.
 Conviction
 The next step is to establish a sense of conviction. By creating interest
and preference, buyers are moved to a position where they are
convinced that a particular product in the class should be tried at the
next opportunity.
 To do this, audience’s beliefs about the product have to be molded and
this is often done through messages that demonstrate the product’s
superiority over a rival or by talking about the rewards as a result of
using the product.
 Many ads like Thumbs Up featured the reward of social acceptance as „grown up‟.
It almost hinted that those who preferred other drinks were kids.
 Action
 Communication must finally encourage buyers to engage in purchase
activity. Advertising can be directive and guide the buyers into certain
behavioral outcomes,
 Use of toll free numbers, direct mail activities and reply cards and coupons.
 Tupperware, Aqua Guard, are famous in Indian cities as a result of its personal
selling efforts.
 For high involvement decisions, the most effective tool in the
communication mix at this stage in the hierarchy is personal selling.
Through the use of interpersonal skills, buyers are more likely to want
to buy a product than if personal prompting is absent.
 Characteristics of Objectives
The second importance concept of DAGMAR approach is that the
advertising goal should be specific. It should be consists of:

Measurement procedure: To indicate exactly what appeal or

image is to be communicated and to specify the measurement
procedure.*
Target Audience : A key tenet of the DAGMAR
approach is that the target audience be well
defined.
Benchmark: President Lincoln has been quoted as
saying, “if we could first known where we are &
where we are tending, we could better judge what to
do and how to do it.” Benchmarks can suggest how
a certain goal can best be reached.*
Written Goals: Finally, goals should be committed to
paper.*
 Challenges to the DAGMAR
Approach

• Sales Goal
• Measurement Problem
• Noise in the System
 Conclusion
The DAGMAR approach to setting objectives is a
refinement & extension developed over a decade
ago. It gave emphasis on communication task related
to a define audience in a given time period. So that
each & every advertisement can only be successful, if
they relate to involving awareness, comprehension,
attitude & action.
New Product Adoption Process
New product introductions and their adoption, particularly in case of new-to-
the-world products often takes a very long time. Customers are sometimes
suspicious, even sceptical about adopting new products.
PLC stages Introduction Growth Maturity Decline

Adopter Innovators Early Early Late Laggards

groups adopters majority majority

Percentages (2.5%) (13.5%) (34.0%) (34.0%) (16.0%)

Product Lifecycle Phases of Adopter Groups

Adoption Decision
The adoption of an innovation requires that an individual or a group of
consumers decide buying a new product.
Stages in adoption process Stages in extended decision-making

Awareness Need recognition

Knowledge Information search

Evaluation Brand evaluation

Trial Purchase

Adoption Post purchase

evaluation

Adoption Process and Extended Decision- making

Factors Affecting New Product Adoption Rate
The chances of a product’s adoption and subsequent diffusion are largely
dependent on its nature. The rate at which the diffusion of an innovation takes
place is a function of the following 10 factors:
1. Type of Target Group
2. Number of People Involved in Decision-making
3. Extent of Marketing Efforts Involved
4. Need Fulfillment
5. Compatibility
6. Relative Advantage
7. Complexity
8. Observability
9. Triability
10. Perceived Risk
Time Factor and Diffusion Process
Time is an important component of new product diffusion and concerns the
time of adoption of a new product by consumers considering, whether
consumers are earlier or later adopters and the rate of diffusion, that is, the
speed and extent with which individuals and groups adopt the new product.
Time of Adoption
There are five categories of adopters classified by time of adoption:
1. Innovators.
2. Early Adopters.
3. The Early Majority.
4. The Late Majority.
5. Laggards.
Innovators
Innovators constitute, on an average the first 2.5 per cent of all those consumers
who adopt the new product and are technology enthusiasts.

Early Adopters
Early adopters tend to be opinion leaders in local reference groups and
represent, on an average the next 13. 5 per cent who adopt the new product.

The Early Majority

The early majority tend to be deliberated and cautious with respect to
innovations and represents 34.0 per cent.
The Late Majority
The late majority (34.0 per cent) are somewhat sceptical about innovative
products. They are conservative, wary of progress, rely on tradition and
generally adopt innovations in response to group norms and social pressure, or
due to decreased availability of the previous product rather than positive
evaluation of the innovation.

Laggards
Laggards represent the last 16.0 per cent of adopters. Like innovators, they
are the least inclined to rely on the group’s norms. Laggards are tradition
bound, tend to be dogmatic and make decisions in terms of the past.