UNIT 3

Advertising: Advertising is a paid form of non-personal presentation and promotion of ideas, goods, or
services by an identified sponsor. Advertising is a paid form of mass communication that consists of the
special message sent by the specific person for the specific group of people (listeners or readers) for
specific period of time, in specific manner to achieve the specific goals.
Stanton, “Advertising consists of all activities in presenting to a group a non-personal, oral or visual,
openly sponsored message regarding a product, service or idea”.
Kotler – “Advertising is any paid form of non-personal presentation and promotion of ideas, goods &
services through mass media such as newspapers, magazines, T.V by an identified sponsor”.
American Marketing Association defines advertising as “any paid form of non-personal presentation and
promotion of ideas, goods or services by an identified sponsor.”
Characteristics of Advertising: Above stated definitions reveal following features:
1. Tool for Market Promotion: There are various tools used for market communication, such as
advertising, sales promotion, personal selling, and publicity. Advertising is a powerful, expensive, and
popular element of promotion mix.
2. Non-personal: Advertising is non-personal or mass communication with target audience. A large
number of people are addressed at time. It is called as non-personal salesmanship.
3. Paid Form: Advertising is not free of costs. Advertiser, called as sponsor, has to spend money for
preparing message, buying media, & monitoring advertising efforts. Company has to prepare its
advertising budget to appropriate advertising costs.
4. Varied Objectives: Advertising is aimed at achieving various objectives. It is targeted to increase sales,
brand image, competition, build relations with publics, to educate people.
5. One-way Communication: Advertising is one-way process. Message moves from company to
customers & sponsor to audience. Message from consumers to marketer is not possible.
6. Use of Media: Advertiser can use any of the several advertising media to convey the message. Print
media (newspapers, magazines, pamphlets, etc.), outdoor media (hoardings, banners, etc.), audio-visual
media (radio, television, Internet, etc.), or any other to address the target audience.
Objectives:
1. To Inform Buyers: This informing customers regarding product’s availability, price, features, qualities,
services, & performance. Company also highlights its location, achievements, policies, and performance
through advertising.
2. To Persuade Buyers: Company uses advertisement to persuade or convince the buyers about superior
advantages offered by its product. Company communicates competitive advantages the product offers to
induce customers buy it.
3. To Remind Buyers: Marketer uses advertising to remind the buyers regarding existence of company,
products, maintenance of quality, superior services, and chasing customer-orientation. Mostly, the
existing firms aim their advertising for this objective.
4. To Face Competition: Advertising is treated as the most powerful weapon to fight with competitors
effectively. Advertising enables the firm to respond the competitors strongly. It helps the firm to
distinguish its total offerings from competitors.
5. Achieve Sales Targets: Increase sales volume is one of the major advertising objectives. A company
can advertise its products in various media to attract customers in different parts of the world. National
& international marketing is the result of advertising.
6. To Educate People: Advertising is not always used only for company’s benefits. It is meant for helping
customers to make the right choice of product. It educates people about availability of new products, its
features & qualities, price, services, & other aspects.
7. To Build Company Image & Reputation: A company opts for advertisement to build prestige &
reputation in the market. Many companies advertise its policies, activities, and achievements to make a
permanent place in the mind of people.
Scope of Advertising:
1. Introduces New Products: It helps in introducing new products of companies in market. Advertising
management through managing all advertising activities induce people to know about or try new
products.
2. Create Wide Awareness: Advertising management enables in creating wide awareness of brand
products among audience. It is one through which company communicates all information regarding
features, uses and advantages of product in market.
3. Increase Sales: This process has a significant role in bringing up the sales of business organizations.
Advertising activities facilitates mass sales for companies by reaching out to large customers and
convincing them for buying it.
4. Enhances Goodwill: Managing of all advertisement activities results in improving the brand’s image in
market. It means companies show their presence among audience. Customers consider those brands that
spend more on keeping aware of their products.
5. Persuades Customers: It assists in bringing more & more customers to business. Advertising focuses
on attracting large people by circulating well defined promotional message among customers. It
convinces them to purchase the brand products by explaining them all benefits.
6. Faces Competition: Advertising management helps in facing the tough competition in market.
Advertising activities enables business in differentiating their products among customers by explaining
them all features and benefits over the other available products.
7. Generate Employment: It has also led to generation of large number of employment opportunities.
There are many people who are working in various advertisement agencies. Companies pay fees to these
agencies for promotion of their products.
Classification of Advertising: It is classified under nine heads.
1. Product advertising: A normal characteristic of advertising is to create primary demand for a product
category rather than for a specific brand. Most companies are successful in building the product image
by using the brand names (Dettol, Horlicks). When the company tries to sell its product or services
through advertising it is referred to as product advertising.
2. Institutional advertising: These advertisements are not always directed to consumers. Instead, it is
aimed at many of the various types of public (shareholders, creditors, etc.). It is not product oriented but
is rather designed to enhance the image of the company.
3. Comparative advertising: This is hot trend in today's competitive market. Advertising play a role on
comparative of two or more specific brands in terms of product / service attributes.
4. Radio Advertising: Radio advertising is an effective way for businesses to target a group of people
based on location or similar tastes.
5. Television Advertising: TV advertising is a popular way to mass-market messages to large audiences.
Although this medium has the ability to reach a high number of potential buyers, it is also one of the
most costly forms of advertising
6. Print Advertising: Magazine and newspaper advertisements are another way to spread the word about a
product or service. Print advertising also target specific audience based on geography.
7. Word of Mouth Advertising: Word of mouth is one of the best & priceless asset of any business. Even
if business owners cannot buy word of mouth advertising, they can encourage their customers to tell
their friends & family about the great product or service they purchased.
AIDA Model: The acronym AIDA stands for Attention, Interest, Desire and Action. These are the four
stages that a consumer goes through when watching or viewing an advertisement. The role of an
advertisement is to attract the customers. After creating an interest, the ad has to bring desire in consumers
mind to use the product and finally the consumer has to take a favorable action towards the product by
ultimately purchasing the product.
THE PROCESS OF AIDA
1. Attention: Attention is usually grabbed by the use of image, color, layout, typography, size, celebrity,
model etc
2. Interest: Once attention is grabbed, it’s necessary to create interest in the viewers mind so that they will
read more about the brand being advertised. By the use of an attractive sub head, interest can be invoked
3. Desire: The element of desire is usually created by the use of body copy where you write in detail about
the necessity of buying the brand, thereby explaining the features of the brand, facts and figures
4. Action: Towards the end, the contact information of the brand will be given where they expects the
viewers to take action immediately. It can be in the form of shop address, toll free numbers or website
address.
Advertising Copy: An ‘advertising copy’ is the means by which an advertiser expresses his ideas in the
form of a message to the readers. If refers to all the reading matters of an advertisement, short or long, and
includes the headline, sub-headlines, text, & name or the initial of an advertiser.
In the words of Schew and Smith, “Advertising copy includes all the written or spoken elements of the
message in advertisement to target customers.”
Elements of an Advertising Copy:
1. Headline: The first copy line which anyone would come in contact with, it is usually written in large
type face. The headline is designed alongside a memorable illustration to capture & attract attention to
the advertisement. It drives prospective buyers to further investigate the brand.
2. Sub-Head: The headlines often, sometimes some copy writers, display the subhead first before the
headlines, & this is basically for a purpose would drive in audience to the entire copy. The subhead is
written in a smaller type face lesser than headlines but larger than the body text.
3. Illustrations: Illustrations are given by way of pictures, symbols or photographs for drawing attention,
creating interest as well as for arousing desire. Significant illustrations may be worth a thousand words
in securing public reception for the product.
4. The Body Copy: This is the illustration text, always in the smallest type face in the copy than the
headline and the subhead. The body copy explains a brand in a few and concise but creative words that
stick faster in the mind of the audience. It explains a brand in the best possible ways.
5. Captions: These are written in a smaller type face than the body copy to represent sales points by
illustrating and explaining them at the same time. Captions are less important to the main selling points
in the advertisement than the body copy
6. The Blurb or Balloon: This is term used in advertising to represent that the illustration of an
advertising copy is coming out from mouth of one of the characters used in the advertising campaign. At
times they are used as headlines and displayed in large size.
7. Box &Panels: These are elements display unique and special information other than those already
displayed by the advertisement. They are use in such features as coupons, special offers & contest rules.
8. Slogan, Logotypes, Trade – Mark and Signatures: These elements often show themselves in every
advertisement. They are companies identifying tags; they differentiate one organization from another
especially when they offer competitive brands.
Advertising Budget: A budget is an expression in monetary terms of the forward plan and the proposed
activity. Advertising plan includes sales targets, product facts, marketing information, competitive
situation, copy treatment etc. The advertising budget is the translation of an advertising plan into monetary
form. It states the amount of proposed advertising expenses and informs the management of the
organisation the expected cost of executing the advertising plan. Advertising Budget is the amount of
money which can be or has to be spent on advertising of the product to promote it, reach the target
consumers & make the sales chart go on the upper side and give reasonable profits to the company.
Methods of Advertising Budget:
1. Affordable method: This is a very simple method of budget allocation. After the budget has been
allocated in all the areas i.e. all the other expenses have been taken care of the company then allocates
the left over money for the advertisements. This method is also called “All you can afford”.
2. Percentage of Sales method: This is the most commonly used method for budget setting. Large firms
generally go by this method. According to this method, advertising and promotions budget is based on
sales of the product. Management determines the amount by either.
 By taking a percentage of the sales revenue
 Assigning a fixed amount of the unit product cost to promotion and multiplying this amount by the
number of units sold.
3. Unit of Sale Method: Consumer durable firms make use of this method as a variant on sales percentage.
While it mostly works out same as a sales percentage, here the firm puts an amount of advertising
expenses on the unit as add on. This method may also be referred to as the fixed-sum-per-unit-of product
method. It is based on the premise that a specific amount of advertising is required for marketing each
unit.
4. Historical Method: In this method last year’s advertising budget is adopted for the year with a view
that practically no change has taken place in the market and market growth is slow, which does not
justify any addition to the budget. Last year’s budget could be multiplied by a factor to cover media rate
increase.
5. Competitive Parity Method: This method involves setting budgets to match competitors’ outlays and
funds. In this method, the company monitors competitors’ advertising and follows it. This method is
generally used in markets in which advertising is heavier and it is felt absolutely important to the
companies not to be left behind the competitors.
6. Return on Investment (ROI): In the percentage-of-sales method, advertising budget depends on the
level of sales. But advertising causes sales. In the marginal analysis and S-shaped curve approaches
increase in advertisement budgets may lead to increases in sales. In other words the advertisement
budget can be considered as an investment.
7. Incremental Concept Approach: According to Managerial Economics a business maximizes its profits
at that point where the incremental cost is equal to the incremental revenue. Businessmen are fully
aware that as long as the cost of producing one extra unit is less than the revenue generated by it, the
business is a profitable one. Any further production after the level at which the additional per unit cost
equals the per unit additional revenue will be unprofitable.
8. The Objective and Task Approach: This method is also known as the research objective method. This
method became prominent during the war time. This method calls upon marketers to develop their
promotion budgets by defining their specific objectives, determining the tasks that must be performed to
achieve these objectives and estimating the cost of performing these tasks. The sum of these costs in the
proposed budget.
9. Expert Opinion Method: Many marketing firms follow this method. Both internal and external experts
are asked to estimate the amount to be spent for advertisement for a given period. Experts, on the basis
of the rich experience on the area, can determine objectively the amount for advertising. Experts supply
their estimate individually or jointly.

Public Relations: Public relations consists number of programme to protect company’s image and its
particular product image. Public relations are a broad set of communication activities used to create and
maintain favourable relations between the organisation and its publics. Customers, employees,
stockholders, government are officials and society.
John. E. Marston “Public relations are the management function which evaluates public attitudes,
identifies the policies and procedures of an organization with the public interest and an organization with
the public interest and executes a programme of action and communication to earn public cum
understanding and acceptance”. –
Objectives of Public Relation:
1. Building Product Awareness: When introducing a new product or re-launching an existing product,
marketers can use a public relation element that generates consumer attention and awareness through
media placements and special events.
2. Creating Interest: Whether a public relation placement is a short product article or is included with
other products in “round up” article, stories in the media can help entice a targeted audience to try the
product.
3. Providing Information: Public relation can be used to provide customers with more in depth
information about products and services. Through articles, collateral materials, newsletters and websites,
public relation delivers information to customers that can help them gain understanding of the product.
4. Stimulating Demand: A positive article in a newspaper, on TV news show or mentioned on the
Internet, often results in a discernable increase in product sales.
5. Reinforcing the Brand: In many companies the public relations function is also involved with brand
reinforcement by maintaining positive relationships with key audiences, and thereby aiding in building a
strong image.
Types of Public Relations:
1. Press Kits: Press kits include written material about the organization and its top people.
2. Audio Releases: Audio releases or video releases are pre-recorded messages distributed to various
media channels.
3. Matte Releases: Small local newspapers accept articles written by organizations when they do not have
sufficient articles or stories to publish. Such releases are called as matte releases.
4. Website Press Room: Public relations experts promote their organization and its products/services
through online press rooms.
5. Media Tour: Public relations experts publicize their organization and its products through media tour
where key people of the organization travel to important places and locations and promote their products
through various interviews to media people.
6. Newsletters: Newsletters are nothing but publications which are distributed on a regular basis among
target audiences. Public relations experts collect complete information of their target customers &
distribute newsletters to create awareness about their products.
7. Events/Functions: Public relations experts organize special events, gatherings, parties, to target their
customers and promote their organization and its products among them. People from media are also
invited for coverage.
Advantages:
1. Credibility – If the public are made aware of the benefits to be gained from a company’s products from
an independent source, and that source is not being paid by the company in question, then the
credibility factor is that much greater.
2. Greater readership – When glancing through a newspaper it is seldom that a great deal of attention is
primarily paid to advertisements. Much more attention is given to editorial or news sections. Similarly,
people are more likely to divert attention from the television to do other things while the advertisements
are being shown.
3. Contain more information – Public relation is able to impart more information to the public than
advertisements can. Whereas public relation, when presented as news, is given more attention and is
therefore able to contain much more detailed information.
4. Cost benefits – No direct payments are made to the media for public relation. There are obviously
costs involved, but PR budgets are far less than those for advertising.
5. Speed – Public relation has an advantage of speed. Information on a major development can often be
issued and reported in a short space of time. It can be flexible & reactive.
Disadvantages:
1. Message distortion – A company has no control over what the media report about them. A press
release, which a company hopes is reported in full, may in fact not be used at all, or may have only a
small portion of it reported.
2. Repetition – With advertisements a company can ensure that there is frequency of the message. Public
Relation does not have this advantage and the message may only be given once, if at all.
Personal Selling: Personal selling is a different form of promotion, involving two way face-to-face
communications between the salesmen & prospect. The personal selling is the interpretation of products
and services benefits and features to the buyer and persuading the buyer to buy these products and services
According to American Marketing Association, “Personal selling is the oral presentation in a
conversation with one or more prospective purchasers for the purpose of making sale.
According to Cundiff and Still Personal selling is basically a method of communication. It involves not
only individual but social behaviour each of the person also in face contrast salesman and prospect
influences the other”.
Features of Personal Selling
1. It is a Part of promotion mix: personal selling is part of promotion mix, in the company’s marketing
program. Other elements being sales promotion, advertising, public relations etc.
2. It is a Two-Way Communication: It is the best tool for two-way communication. Salesman can
provide necessary information to customer about company’s offer, and also can collect information from
customer. The ultimate aim is to persuade the customer.
3. Presentation & Persuasion: Salesman through his knowledge tries to present his product to the
prospective buyer & tries to persuade the prospective buyer with the help of various skills & techniques.
4. Flexible: Personal selling is more flexible than other promotional tools. Salespersons see their
customer’s reaction to a particular sales approach & make adjustment according to the situation.
5. Develop long-term Relationship: Personal selling results in development of personal relationship
between the sales person & buyer. Such a relationship has important place in sales.
6. Quick solution of Queries: The prospective buyer can make inquiries regarding the product. Salesman
answers these queries quickly and removes any doubts in the mind of the buyer.
7. Customer Confidence: By sales presentation, a capable salesman can remove all doubts, quarries, &
misunderstandings, & win customer’s confidence. It increases customers’ faith in company & its offers.
Objectives of Personal Selling
1. To Sell the Product: The main aim of Personal Selling is to sell the products both to actual customer
and prospective customers. The ultimate objective of personal selling is to increase the sales of a
particular company so that maximum revenue can be generated by the company.
2. Providing Information – When salespeople engage customers a significant amount of the conversation
focuses on product information. It includes slide presentations, brochures, research reports, online
videos, and many other forms of informational material.
3. Creating Interest – The personal selling involves person-to-person communication makes it a natural
method for getting customers to experience a product for the first time. In fact, creating interest building
product awareness as sales professionals can often accomplish both objectives during the first encounter
with a potential customer.
4. To persuade the customers- The personal selling is an art of persuasion in this salesperson persuade
and insist on the customer to buy the product. This objective plays a very perfect role for any personal
seller.
5. Build long-term Relationship: Personal selling results in the development of personal relationship
between the sales person and the possible buyer. Such a relationship has an important place in sales.
6. To maintain regular communication- Personal selling involves two-way dialogues between the
buyers and sellers and a buyer can share his thoughts about a particular purchase with the salesperson
keeping in mind the taste and preference of the consumer salesman.
Advantages of personal selling:
1. Two-Way Communication: It is the best tool for two-way communication. Salesman can provide
necessary information to customer about company’s offer & can collect information from customer.
Customer can actively involve with salesman to solve his doubts and objections.
2. Personal Attention: Advertising and publicity are among mass communication tools. They do not cater
individual needs. Personal selling focuses on personal problems of customers. It is comparatively more
effective and result-oriented.
3. Demonstration: Except television advertisements, demonstration is not possible. However, television
demonstration is much limited. Salesman can provide a detail demonstration and can supervise when
customer is making the actual use of products.
4. Complementary to other Promotional Tools: Personal selling can support advertising, sales
promotion, and publicity. It removes the drawbacks of advertising and sales promotion. Advertising
increases awareness while personal selling reinforces the advertising message. Similarly, it make more
effective by personal guidance or conviction.
5. Flexibility: Sales talks and presentation can be adjusted according to situation to suit individual nature,
motives, and problems.
6. Feedback: This is the only market promotion technique that provides an immediate feedback. At the
end of every call/visit, a salesman can easily judge whether the customer is interested or indented to buy.
7. Customer Confidence: By presentation a salesman can remove doubts, & misunderstandings, & win
customer’s confidence. It increases customers’ faith in company & its offers.
Disadvantages
1. Management Conflict: Unluckily, there arise situations in even the best companies where sales staff
and marketing staff know they work for the same company and for the same goals. The marketing staff
might not be able to understand the problems faced by the sales staff, or the salespeople might be able to
understand why marketing people do things the way they do.
2. Ethical Problems: There is a lack of complete control of manager over the messages the salespeople
communicate and due to income and advancement directly tied to sales. They may say and do things
they know are not entirely ethical of the firm in order to get a sale.
3. High Cost: When cost per sales call continues to climb, the marketer finds mass communications a
more cost-effective.
4. Poor Reach: Unlike other elements personal selling fails to reach as many members of the target
audience. Even if money were no object, the sales force has only so many hours and so many people it
can reach in a given time.
5. Inconsistent Messages: The message to be communicated is designed by marketing staff with a
particular communications. Once this message determined, it is communicated to all receivers. Hence,
the marketing staffs are at the mercy of the sales force with respect to what exactly is communicated.
Process
1. Prospecting: Searching for prospects is prospecting. Prospecting is the work of collecting the names &
addresses or persons who are likely to buy the firm’s products and services.
• Searching names by examining data sources such as newspapers, directories, etc.
• Establishing a booth at trade shows and exhibitions
• Getting the names of the prospects from existing customers
• Referral sources from dealers, suppliers, sales reps, executives, etc.
• Using the telephone, mail and the internet to find leads.
2. Pre-approach: Pre-approach is to get more detailed facts about a specific individual to have effective
sales appeals on him or her. It is a record round effort to get details such as his ability, need, authority,
accessibility to buy; it is a closer look of prospects, likes & dislikes, tastes, habits, financial status,
material status, & family background.
• Approach: Approach means the meeting of the prospect in person by the salesman where he makes face
to face contact with prospects to understand them better. It is critical stage of the sales that the sales are
either won or lost. Success follows the salesman who possesses courage, courtesy & confidence.
3. Presentation and demonstration: Presentation implies an array and decoration of articles in the shop.
It is the heart of selling process. Effective presentation has the capacity to convince the customer of his
sales proposition. It creates and holds the interest of customers towards the products. It would be wrong
to assume that all those who enter the shop do buy the products. Demonstration is a part of presentation
because, more description is not enough. Demonstration is the crucial task of providing the proofs and
providing the statements about quality, utility, performance and service of a product by evidences of
experiment, operation or a test.
4. Overcoming objections: For a creative and persuasive salesman, the process of selling really starts
when the prospect raises objections. For every action of salesman there is prospect’s pro-action or
reaction that is, approval or disapproval. Each salesman should understand the reasons as to why
prospects raise objections because; each objection has its roots in the buying decision.
5. Closing: Earlier stages of sales talk namely, prospecting, pre-approach; approach, presentation &
handling the objections have been designed to induce the prospect to make decision to buy so that a sale
can be concluded. The success in earlier stages will lead to the last stage of closing the sale. Here,
‘close’ means the act of actually getting the prospect’s assent to the sales proposal or he gets an order.
6. Follow-up: Immediately after closing the sale, the salesperson should take some follow up measures. He
may give details about delivery time, purchase terms and mode of payment of price, etc. The salesperson
can ensure customer satisfaction by properly attending matters which are important to the customers.
Thus, follow up is necessary if the salesperson wants to ensure repeat purchase.
Sales Promotion: Sales promotion is thus a part of promotion, and is restricted to direct inducements on a
short-term basis given to consumers or trade so as to stimulate purchases of products and services. Sales
promotion, in other words, is a marketing activity that adds to the basic value of the product or services for
a limited period of time ad directly stimulates purchasing by the target audience.
Sales Promotion Tools and Techniques
1. Consumer Promotion Tools:
a) Samples – Small quantity, sometimes free of cost or sometimes at minimum price, sent door to door
personally or through mails or with other products etc.
b) Coupons – A certificate that gives buyers a saving when they purchase specified products.
c) Cash refund offers or rebates – Are like coupons except that the price reduction occurs after the
purchase rather than at the retail outlet. Consumer sends proof of purchase and manufacturer sends the
refund part of the purchase price to the consumer.
d) Price packs (cents-off deals) – Offers consumers saving off the regular price of the product, directly
cuts price on the label, or combination of two products (tooth paste and tooth brush).
e) Premiums – Goods offered either free or at low cost as an incentive to buy a product. Sometimes
premium are costlier than the product it is sold with, (brass tray free with a product).
f) Patronage reward – Cash or gift, for the regular use of a particular product of the company like
privilege card membership given by the company to the regular user of the products.
g) POP displays – (Point of purchase promotion) Right display at right place to attract consumers.
h) Demonstrations can be at –
 Retail stores
 School
 Door to door
i) Sales promotion letters and catalogues.
2. Trade Promotion Tools: Here the focus is more on the wholesalers and retailers as compared to the
consumers. Trade promotion can persuade the wholesaler, retailers or distributor to carry a brand,
advertise or give a shelf space to the products of a particular company.
3. Business Promotion Tools: These promotions are used for such purposes as generating business leads,
rewarding customers, and motivating sales people. It uses many tools as used in trade promotion &
consumer promotion. Its main focus is on trade shows & sales contests.
Advantages of Sales Promotion
1. Introduce New Products: Sales promotion techniques are the most effective ways of introducing
innovative products in the market by business organizations. Sales promotion enables in attracting
peoples towards these products using penetration price policy, discounts, coupons, & other benefits.
2. Generate New Leads: It generates a large number of leads for business by exposing more and more
customers and other business partners to the products of the company. Sales promotion serves as a
communication link between the producer and the customer. It supplies all important information about
products to clients and resolves all their queries.
3. Large Scale Production: Sales promotion facilitates an organization is enjoying economies of cost by
carrying out large-scale production. It increasing the demand for the company’s products by doing a
mass promotion in the market. An increase in sales volume will ultimately lead to reducing the per-unit
cost to the company by doing mass production of products.
4. Immediate Returns: It offers more quick and immediate returns in comparison to other components of
the promotion mix. Sales promotion uses different methods for boosting the sales volume within a short
period of time. Measures like samples, discounts, coupons, free trials, giving product demonstrations
etc. are attracting more customers for buying products thereby raising the overall sales volume.
5. Better Control: Sales promotion techniques provide effective control management for regulating the
promotional activities of organization. Programmes of sales promotion are more cost-efficient having
lower promotional costs and provide quick and better returns. Managers can easily evaluate the results
of each promotional programmes in relation to their cost factor.
6. Improve Public Image of Firm: It has an effective role in building a strong image of firm in market.
Sales promotion provides customers with all necessary information about products and resolves all their
queries. Clients in presence of right information are able to choose right product by easily doing a
comparison of brand products with other competitors in market.
Disadvantages of Sales Promotion
1. Increase Price Sensitivity: Sales promotion is disadvantageous for business organization if it is
provided on a regular basis by organization. Customers may become too price-sensitive and wait for
promotional deals to be announced by the company. They may not buy products from routine sales at
the market and instead buy at discounted price which lowers the overall organizational profitability.
2. Costly: Sales promotion raises the expenses of business organization which have adverse impact on
their profit margin. Techniques of sales promotion like free samples, discounts, and coupons require
huge costs on the part of company. It is uncertain whether all these measures will provide equal returns
that reduce the profitability of business.
3. Discolor Brand Image: Sales promotion may also lower the perception of customers towards the brand
in case it is overused by the organization. When products are offered continuously at discounted price by
brand then the customers believe it as a regular price. They may doubt the product quality of the brand
in comparison to other competitors providing products with no offers and price reductions.
4. Short-Term Orientation: Sales promotion is meant for short-term which boosts the sales volume for a
shorter period by offering distinct offers and benefits to customers. Short-term sales volume is quite
difficult to maintain and has a negative influence on the long-term future of business.
Direct Marketing: A form of advertising in which physical marketing materials are provided to consumers
in order to communicate information about a product or service. Direct marketing does not involve
advertisements placed on the internet, on television or over the radio. Types of direct marketing materials
include catalogs, mailers and fliers.
Characteristic
1. A Set of Database: A database of names (prospects, customers, businesses, etc.), often with certain
other relevant information such as – contact number/address, demographic information, purchase
habits/history, company history, etc., is used to develop a list of targeted entities with some existing
common interests, traits or characteristics. Generating such a database is often considered part of the
Direct Marketing campaign.
2. Addressing the Listed Customers: Marketing messages are addressed directly to this list of customer
and/or prospects. Direct marketing relies on being able to address the members of a target market.
Addressability comes in a variety of forms including email addresses, phone numbers, Web browser
cookies, fax numbers and postal addresses.
3. Direct Action Related: Direct marketing seeks to drive a specific “call to action.” For example, an
advertisement may ask the prospect to call a free phone number, mail in a response or order, or click on
a link to a website.
4. Specific Emphasis: Direct marketing emphasizes measurable responses, results & costs from prospects
and/or customers – regardless of medium. Direct marketing is practiced by businesses of all sizes – from
the smallest start-up to the leaders. A well-executed direct advertising campaign can prove a positive
return on investment by showing how many potential customers responded to a clear call-to-action.
Important Tools of Direct Marketing:
1. Face-to-Face Selling: It remains the preferred tool in business-to-business markets, where firms, having
a limited and well- identified number of prospects, use their sales force to locate them and to develop
them into customers.
2. Direct Mail: The term “direct mail” is used to refer to communications sent to potential customers or
donors via the postal service and other delivery services. Direct mail is sent to customers based on
criteria such as age, income, location, profession, buying pattern, etc.
3. Telemarketing: Another common form of direct marketing is telemarketing, in which marketers contact
customers by phone. The primary benefit to businesses is increased lead generation, which helps
businesses increase sales volume and customer base.
4. Email Marketing: Sending marketing messages through email or Email marketing is one of the most
widely used direct- marketing methods. One reason for email marketing’s popularity is that it is
relatively cheaper mode of direct marketing.
5. Voicemail Marketing: Voicemail marketing emerged out of the market prevalence of personal voice
mailboxes, and business voicemail systems. Voicemail marketing presented a cost effective means by
which to reach people directly, by voice.
6. Couponing: Couponing is used in print and digital media to elicit a response from the reader.
7. Direct Response TV: Direct marketing via television (commonly referred to as DRTV) has two basic
forms- long form and short form, which refers to typical 30-second or 60-second commercials that ask
viewers for an immediate response.
8. Direct Selling: Direct selling is the sale of products by face-to-face contact with the customer, either by
having salespeople approach potential customers in person, or through indirect means such as
Tupperware parties.
9. Direct Response Radio: In direct response radio, ads contain a call to action with a specific tracking
mechanism. Often, this tracking mechanism is a “call now” prompt with a toll-free phone number or a
unique Web URL. Results of the ad can be tracked in terms of calls, orders, customers, leads, sales,
revenue, and profits that result from the airing of those ads.
Advantages of Direct Marketing:
1. Flexible Targeting: Direct marketing enables an enterprise directly identify, isolate and communicate
with well-defined target markets.
2. Multiple Uses: Direct marketing is used not only to increase the sell but also to test new markets and
trial new products or customers, to reward existing customers to build loyalty, collect information for
future campaigns.
3. Cost-Effectiveness: The cost per acquisition of direct mail can be significantly less than other
marketing methods.
4. Ease of Management: Direct marketing provides greater control and accountability than other
marketing methods. It is easy to measure results under direct marketing campaigns. It enables the
enterprise to plan effectives for future growth.
5. Rapid Delivery: Direct marketing is both swift and flexible in achieving results. This is especially true
for telemarketing, one of the direct marketing tools, as the results of a conversation can be logged
immediately and scripts adjusted straight away to improve results.
6. Relationship Building: Direct marketing is far more effective at initiating and developing a meaningful
dialogue with new customers.
Disadvantages of Direct Marketing:
1. May be seen as competing with existing intermediaries – May upset marketing intermediaries as sales
through direct marketing may be taking sales away from them. In effect, you may end up competing
with your customers, that is, the intermediaries.
2. May be seen as intrusive by consumers – Especially a problem for door to door and tele-marketing
direct marketing techniques.
3. Costs – Initial customer acquisition costs are high — high cost per thousand reached; and database
development can be expensive