BBA Marketing Advertising and Sales Promotion PDF

Advertising and Sales Promotion Unit-01 Introduction to Advertising Semester-04 Bachelor of Business Administration - Marketing  Advertising and Sales Promotion UNIT...

Advertising and Sales Promotion Unit-01 Introduction to Advertising Semester-04 Bachelor of Business Administration - Marketing  Advertising and Sales Promotion UNIT Introduction to Advertising Names of Sub-Unit Nature and importance; Types of advertising; Setting of advertising objectives: communication and sales objectives, DAGMAR approach; setting of advertising budget Overview This unit begins with an overview of the introduction to advertising with nature and emphasizes its importance in creating a positive impact on both the environment and society. It then delves into various types of advertising, highlighting their distinct characteristics and strategies. The unit also covers the setting of advertising objectives, including communication and sales objectives, with a focus on the DAGMAR (Defining Advertising Goals for Measured Advertising Results) approach. Additionally, it explores the process of setting an advertising budget, taking into account factors such as campaign objectives, market conditions, and financial considerations. Learning Objectives In this unit, you will learn to understand the significance of advertising with nature and its importance in promoting sustainable practices. You will also explore the various types of advertising, such as print, broadcast, digital, and outdoor, and gain insights into their unique characteristics and strategies. Additionally, you will develop the skills to set effective advertising objectives, both in terms of communication goals and sales targets, using the DAGMAR approach as a framework. Furthermore, you will learn how to determine an appropriate advertising budget by considering factors such as campaign goals, market conditions, and financial constraints. 2 Introduction to Advertising Learning Outcomes At the end of this unit, you would acquaint with the concepts, objectives and budgeting methods of advertising used in marketing Pre-Unit Preparatory Material  https://blog.hubspot.com/marketing/how-to-make-an-ad  https://www.wallstreetmojo.com/advertising-budget/  https://www.geektonight.com/dagmar-approach/ Table of Topics 1.1 Introduction to Advertising 1.2 Nature and importance 1.3 Types of advertising 1.4 Setting of advertising objectives 1.5 Communication and sales objectives 1.6 DAGMAR approach 1.7 Setting of advertising budget 1.8 Conclusion 3  Advertising and Sales Promotion 1.1 Introduction to Advertising This unit provides an introduction to the fundamental concepts and principles of advertising. It covers the role of advertising in marketing, its purpose in promoting products or services, and its impact on consumer behavior. The unit explores the different components of an advertising campaign, including target audience identification, message development, creative execution, and media selection. Additionally, it examines the ethical considerations and regulations that govern advertising practices. By the end of this unit, you will have a solid understanding of the key elements and functions of advertising and how they contribute to successful marketing strategies. 1.2 Nature and importance Nature and Importance of Advertising  Branding and Awareness: Advertising plays a crucial role in creating brand awareness and establishing a strong brand identity. Through advertising, companies can showcase their products, services, and unique selling propositions to target audiences. By consistently exposing consumers to their brand messages, companies can build familiarity, recognition, and recall, leading to increased brand awareness. Strong brand awareness helps companies stand out from competitors and enhances their credibility and trustworthiness.  Communication and Information: Advertising serves as a powerful means of communication between businesses and consumers. It enables companies to convey information about their offerings, such as product features, benefits, pricing, promotions, and availability. Effective advertising campaigns utilize creative messaging and storytelling techniques to capture attention and engage consumers. By effectively communicating key messages, advertising helps consumers make informed purchasing decisions.  Influence and Persuasion: Advertising aims to influence consumers' attitudes, opinions, and behaviors. Through compelling storytelling, persuasive visuals, and emotional appeals, advertisers can shape consumer perceptions and preferences. Advertising can create a desire for products or services, evoke emotions, and position brands as solutions to consumers' needs or aspirations. 4 Introduction to Advertising By tapping into consumers' motivations and desires, advertising can drive purchase intent and lead to increased sales.  Market Expansion and Growth: Advertising plays a vital role in expanding a company's market reach and attracting new customers. By reaching a wide audience through various advertising channels, businesses can generate interest and curiosity in their offerings. Advertising campaigns can target specific demographics, geographical regions, or niche markets, helping businesses penetrate new markets and increase their customer base. Increased market share and customer acquisition contribute to business growth and profitability.  Competitive Advantage: Advertising allows businesses to differentiate themselves from competitors and establish a unique selling proposition. By effectively communicating their brand's distinct features, benefits, or values, companies can create a competitive advantage. Advertising can highlight what sets a brand apart from others in the market, whether it's superior quality, innovative features, exceptional customer service, or a compelling brand story. A strong advertising strategy can help businesses position themselves as market leaders and gain a competitive edge.  Building Customer Relationships: Advertising plays a crucial role in building and nurturing relationships with customers. By consistently engaging with consumers through targeted advertising campaigns, companies can foster brand loyalty and long-term customer relationships. Advertising can reinforce positive associations with a brand, evoke positive emotions, and create a sense of loyalty and affinity. Through ongoing advertising efforts, businesses can stay connected with their customers, encourage repeat purchases, and leverage word-of-mouth marketing.  Economic Impact: Advertising contributes to economic growth by driving consumer spending and business revenues. Effective advertising campaigns stimulate consumer demand, leading to increased sales and revenue for businesses. As businesses thrive, they create job opportunities, contribute to tax revenues, and drive economic activity in various sectors. Advertising also supports media and advertising agencies, fostering a thriving industry that employs creative professionals and drives innovation. 5  Advertising and Sales Promotion 1.3 Types of advertising There are various types of advertising that companies and marketers can utilize to reach their target audiences and promote their products, services, or ideas. The most common types of advertising  Print Advertising: Print advertising refers to advertisements that are printed on physical mediums such as newspapers, magazines, brochures, flyers, direct mail, and posters. Print ads can be highly targeted, allowing businesses to reach specific demographics or geographic areas. They offer a tangible and long- lasting form of advertising that can be easily revisited by readers.  Television Advertising: Television advertising involves creating commercials that are aired on television networks or cable channels. TV ads utilize a combination of visuals, audio, music, and storytelling to capture viewers' attention and convey the desired message. Television advertising allows for a wide reach and the ability to target specific time slots or TV shows that align with the target audience.  Radio Advertising: Radio advertising involves creating audio-based ads that are broadcast on radio stations. Radio ads rely solely on audio to communicate the message and capture listeners' attention. They can be effective in reaching specific demographics or local audiences and can be particularly useful for promoting time-sensitive offers or events.  Outdoor Advertising: Outdoor advertising encompasses various forms of advertising displayed in public spaces, targeting audiences when they are on the move. This includes billboards, posters, digital signage, transit ads (buses, taxis, trains), street furniture ads (bus shelters, benches), and more. Outdoor ads aim to capture attention and create brand visibility in high-traffic areas.  Mobile Advertising: With the rise of smartphones, mobile advertising has gained significant importance. It includes various formats such as display ads within mobile apps, in-app advertisements, mobile web banners, and location- based advertising that targets users based on their geographical location.  Influencer Marketing: Influencer marketing involves collaborating with influential individuals on social media who have a substantial following and credibility in a particular niche. Advertisers leverage influencers' reach and influence to promote their products or services through sponsored content or endorsements. 6 Introduction to Advertising  Product Placement: Product placement involves integrating products or brands into movies, TV shows, or other forms of media. The products are strategically placed within the content to gain exposure and create brand associations.  Guerilla Advertising: Guerilla advertising refers to unconventional and creative advertising campaigns that aim to surprise and engage audiences in unexpected ways. It often involves using public spaces, viral marketing techniques, or interactive experiences to generate buzz and brand awareness.  Direct Response Advertising: Direct response advertising aims to generate an immediate response or action from the audience. It often includes a call-to- action (CTA) that prompts viewers to visit a website, call a phone number, or make a purchase. Direct response ads can be found across various media channels, including print, TV, radio, and digital. Digital Advertising Digital advertising involves using online platforms to promote products or services. It encompasses a wide range of formats and channels, including:  Display Advertising: This includes banner ads, pop-up ads, and other visual ads displayed on websites, apps, or social media platforms.  Search Engine Marketing (SEM): SEM involves placing ads within search engine results pages, targeting specific keywords and appearing when users search for relevant terms. It includes paid search ads (e.g., Google Ads) and search engine optimization (SEO) techniques.  Social Media Advertising: This type of advertising takes place on social media platforms such as Facebook, Instagram, Twitter, LinkedIn, and YouTube. Advertisers can create targeted ads based on users' demographics, interests, and behaviors.  Video Advertising: Video ads are displayed before, during, or after online video content. They can be placed on platforms like YouTube or embedded within websites or apps.  Native Advertising: Native ads blend seamlessly with the content of a website or app, providing a less intrusive and more organic advertising experience. These are just a few examples of the many types of advertising available to businesses. The choice of advertising type depends on factors such as target audience, budget, 7  Advertising and Sales Promotion marketing objectives, and the most effective channels to reach and engage the intended audience. 1.4 Setting of advertising objectives Setting advertising objectives is a crucial step in developing effective advertising campaigns. Clear and well-defined objectives provide direction and serve as benchmarks for measuring the success of the advertising efforts. 1.4.1 Steps involved in setting advertising objectives  Understand the Marketing Goals: Start by aligning the advertising objectives with the broader marketing goals of the organization. Identify how advertising can contribute to the overall marketing strategy and support the company's growth objectives. For example, marketing goals could include increasing market share, launching a new product, or enhancing brand perception.  Identify Target Audience: Determine the specific target audience that the advertising campaign aims to reach. Understand their demographics, psychographics, behaviors, and preferences. This information will help shape the objectives by aligning them with the needs and motivations of the target audience.  SMART Objectives: Ensure that the advertising objectives are SMART - Specific, Measurable, Achievable, Relevant, and Time-bound. This means clearly defining what is to be achieved, setting measurable metrics to track progress, ensuring the objectives are realistically attainable, aligning them with the broader marketing goals, and setting a specific timeframe for achievement.  Prioritize Objectives: If multiple objectives are identified, prioritize them based on importance and feasibility. Determine which objectives are most critical to achieving the overall marketing goals and allocate resources accordingly.  Monitor and Evaluate: Once the advertising objectives are set, establish metrics and key performance indicators (KPIs) to measure the progress and effectiveness of the advertising campaigns. Regularly monitor and evaluate the performance against the set objectives, making adjustments as needed to optimize results. 1.4.2 Define Communication Objectives 8 Introduction to Advertising Communication objectives focus on conveying messages and creating awareness among the target audience. Common communication objectives include:  Increasing Brand Awareness: The objective is to make the target audience aware of the brand's existence, values, and offerings.  Enhancing Brand Perception: This objective aims to shape how the target audience perceives the brand in terms of attributes, quality, reliability, or innovation.  Conveying Product Benefits: Communicating the unique selling points, features, and benefits of the product or service to the target audience.  Establishing Brand Positioning: The objective is to position the brand distinctively in the minds of consumers, differentiating it from competitors.  Educating the Audience: Providing information and knowledge about the product or service to help consumers make informed decisions. 1.4.3 Determine Sales Objectives Sales objectives are directly tied to driving sales and revenue. These objectives focus on influencing consumer behavior and generating tangible outcomes. Common sales objectives include:  Increasing Sales Volume: The objective is to drive an immediate increase in product or service sales.  Growing Market Share: This objective aims to increase the brand's market share by capturing a larger portion of the target market.  Customer Acquisition: The objective is to attract new customers and expand the customer base.  Driving Purchase Intent: Influencing consumers to have a strong desire and intention to purchase the product or service. By setting clear and well-defined advertising objectives, companies can align their advertising efforts with broader marketing goals, effectively communicate with the target audience, drive desired consumer behaviors, and measure the success of their advertising campaigns. 9  Advertising and Sales Promotion 1.5 Communication and sales objectives Communication and sales objectives are two key types of objectives that organizations set when developing advertising campaigns. These objectives focus on different aspects of advertising and have distinct purposes. 1.5.1 Communication Objectives Communication objectives in advertising are centered around conveying messages and creating awareness among the target audience. These objectives aim to establish a strong brand presence, shape consumer perceptions, and effectively communicate key brand messages. Here are some common communication objectives:  Increasing Brand Awareness: The objective is to make the target audience aware of the brand's existence, products, and services. The focus is on reaching a broad audience and creating familiarity with the brand.  Enhancing Brand Perception: This objective aims to shape how the target audience perceives the brand. It involves establishing a positive brand image and positioning the brand in a desirable and differentiated way.  Conveying Product Benefits: Communication objectives may include highlighting the unique features, benefits, and advantages of the products or services being advertised. The objective is to clearly communicate why the target audience should consider purchasing the brand's offerings.  Establishing Brand Positioning: This objective focuses on positioning the brand in the minds of consumers. It involves differentiating the brand from competitors and establishing a distinctive brand identity based on specific attributes, values, or benefits.  Educating the Audience: Communication objectives can involve providing information and knowledge to the target audience. This may include educating consumers about the brand's offerings, industry trends, or the benefits of using the products or services. 1.5.2 Sales Objectives Sales objectives in advertising are directly tied to driving sales and revenue. These objectives aim to influence consumer behavior and generate tangible outcomes. Here are some common sales objectives: 10 Introduction to Advertising  Increasing Sales Volume: The primary objective is to drive an immediate increase in product or service sales. This may involve promoting special offers, discounts, or incentives to encourage consumers to make a purchase.  Growing Market Share: This objective focuses on increasing the brand's market share by capturing a larger portion of the target market. The aim is to outperform competitors and gain a stronger foothold in the industry.  Customer Acquisition: The objective is to attract new customers and expand the customer base. This may involve targeting new market segments, increasing lead generation, or converting prospects into paying customers.  Driving Purchase Intent: This objective aims to influence consumers' purchase decisions by creating a strong desire and intention to buy the brand's products or services. It involves persuasive messaging and compelling calls-to-action to prompt immediate action. It is important to note that communication and sales objectives are often interconnected. Effective communication objectives help create awareness, shape perceptions, and ultimately drive sales. Sales objectives, on the other hand, rely on effective communication strategies to generate consumer interest and prompt purchase behavior. When setting advertising objectives, organizations should ensure that both communication and sales objectives are aligned with their overall marketing goals. This alignment helps create cohesive and integrated advertising campaigns that effectively communicate brand messages while driving tangible business results. 1.6 DAGMAR approach The DAGMAR approach is a model for setting and measuring advertising objectives. DAGMAR stands for Defining Advertising Goals for Measured Advertising Results. It was developed by Russell Colley in the late 1960s and has since become a popular framework in the field of advertising. The primary focus of the DAGMAR approach is to establish clear and measurable objectives that can be used to evaluate the effectiveness of advertising campaigns. Overview of the DAGMAR approach  Define the Target Audience: The first step in the DAGMAR approach is to clearly define the target audience for the advertising campaign. This involves 11  Advertising and Sales Promotion understanding the demographics, psychographics, behaviors, and characteristics of the audience that the campaign aims to reach and influence.  Set Specific Objectives: The DAGMAR approach emphasizes the importance of setting specific advertising objectives. These objectives should be precise, measurable, and time-bound. They should also align with the overall marketing goals of the organization. For example, objectives could include increasing brand awareness by 20% among the target audience within six months or driving a 15% increase in product sales within a specific time frame.  Focus on Communication Effects: The DAGMAR approach places a strong emphasis on communication effects as the key measurement of advertising effectiveness. It recognizes that the primary purpose of advertising is to communicate with and influence the target audience. Communication effects can include creating awareness, changing attitudes, influencing purchase intentions, or increasing brand recall.  Establish Benchmark Criteria: The DAGMAR approach suggests setting benchmark criteria that define the desired level of communication effects. These criteria serve as a reference point against which the actual performance of the advertising campaign can be evaluated. For example, the benchmark criteria could be achieving a minimum of 40% brand recall among the target audience or increasing brand preference by 15%.  Measurement and Evaluation: The DAGMAR approach emphasizes the importance of measuring and evaluating the performance of advertising campaigns against the established objectives and benchmark criteria. This involves collecting data, conducting research, and analyzing the results to determine the extent to which the objectives have been achieved. Various measurement techniques, such as surveys, focus groups, tracking studies, or sales data analysis, can be used to evaluate the effectiveness of the campaign.  Iterative Process: The DAGMAR approach recognizes that advertising objectives may need to be refined and adjusted based on the evaluation of campaign performance. It is an iterative process that allows for continuous improvement and optimization of advertising efforts. By following the DAGMAR approach, advertisers can set clear and measurable objectives, focus on communication effects, and evaluate the effectiveness of their advertising campaigns. It provides a structured framework that helps align advertising goals with overall marketing objectives and enables data-driven decision-making in the field of advertising. 12 Introduction to Advertising 1.7 Setting of advertising budget Setting an advertising budget involves determining the amount of financial resources that an organization is willing to allocate for advertising activities. The budgeting process requires careful consideration of various factors to ensure that the allocated budget is sufficient to achieve the desired advertising objectives. Steps involved in setting an advertising budget  Define Advertising Objectives: Before setting a budget, it is essential to clearly define the advertising objectives. These objectives should align with the overall marketing goals and provide a framework for determining the budget allocation. For example, if the objective is to increase brand awareness, the budget may need to focus more on reach and frequency of advertising placements.  Consider Marketing and Financial Factors: Evaluate the marketing and financial factors that influence the budgeting decision. These factors may include the size of the target market, competitive landscape, product life cycle stage, brand position, marketing goals, and available financial resources. It is important to consider both the short-term and long-term impact of advertising on the organization's bottom line.  Conduct Market and Competitive Analysis: Perform a thorough analysis of the market and competitors to understand the level of advertising activity in the industry. This analysis will help determine the level of investment required to effectively compete and reach the target audience. It is essential to consider the advertising spending patterns of competitors and the potential impact on market share and brand visibility.  Select Advertising Channels and Tactics: Identify the advertising channels and tactics that will be used to reach the target audience. Different channels have varying costs associated with them, and the budget needs to reflect the chosen media mix. Evaluate the reach, effectiveness, and cost-efficiency of each channel and select the ones that align with the target audience and advertising objectives.  Consider the Stage of Product Life Cycle: The stage of the product or service life cycle can influence the advertising budget. For new products or services, a higher budget may be required to generate awareness and establish market presence. In contrast, mature products may require a budget to sustain brand awareness or support promotional activities. 13  Advertising and Sales Promotion  Set a Realistic Budget: Determine the budget amount based on the information gathered from the previous steps. It is important to set a realistic budget that balances the desired advertising outcomes with available financial resources. Consider the organization's overall financial situation, revenue projections, profit margins, and other operational expenses.  Monitor and Adjust: Regularly monitor the performance of advertising campaigns and assess their impact on the desired objectives. Evaluate the return on investment (ROI) and adjust the budget allocation if necessary. Make data-driven decisions based on the effectiveness of different advertising tactics and channels. It is worth noting that there are different approaches to setting an advertising budget, including percentage of sales, objective and task, competitive parity, and affordability. Each approach has its advantages and limitations, and organizations should choose the most suitable method based on their specific circumstances and goals. By following a systematic approach and considering the relevant factors, organizations can set an appropriate advertising budget that supports their marketing objectives and maximizes the impact of their advertising efforts. 1.8 Conclusion  Understanding the nature and importance of advertising is crucial for businesses to effectively communicate with their target audience, promote their products or services, and achieve their marketing goals. Advertising serves as a powerful tool to create brand awareness, shape consumer perceptions, and drive consumer behaviors.  When it comes to advertising, there are various types to consider, such as print advertising, broadcast advertising, digital advertising, outdoor advertising, and direct response advertising. Each type has its unique characteristics and advantages, and the choice of advertising type should align with the target audience, budget, and marketing objectives.  Setting advertising objectives is a critical step in developing successful advertising campaigns. Communication objectives focus on conveying messages and creating awareness, while sales objectives are directly tied to driving sales and revenue. Both types of objectives should be specific, measurable, and aligned with the overall marketing goals of the organization. 14 Introduction to Advertising  The DAGMAR approach provides a structured framework for setting and measuring advertising objectives. It emphasizes the importance of clear and measurable objectives, focusing on communication effects, and evaluating campaign performance. By following the DAGMAR approach, advertisers can ensure that their advertising efforts are strategic, accountable, and effective.  Setting an advertising budget requires careful consideration of factors such as advertising objectives, marketing and financial factors, market analysis, and the stage of the product life cycle. A realistic budget should be set that balances the desired outcomes with available resources. Regular monitoring and adjustments based on campaign performance are necessary to optimize the budget allocation and maximize the return on investment. 1.9 Glossary  Advertising: The activity of promoting products, services, or ideas through various media channels to reach and persuade a target audience.  Brand Awareness: The level of recognition and familiarity that consumers have with a particular brand.  Brand Perception: How consumers perceive and perceive the brand in terms of attributes, quality, reputation, and other factors.  Communication Objectives: Objectives in advertising that focus on conveying messages, creating awareness, and shaping consumer perceptions.  Sales Objectives: Objectives in advertising that are directly tied to driving sales, revenue, and influencing consumer purchase behavior.  Target Audience: The specific group of individuals or customers that a brand or advertising campaign aims to reach and influence.  Reach: The number or percentage of individuals or households exposed to a specific advertising message or campaign.  Frequency: The number of times an individual or household is exposed to a specific advertising message or campaign.  Media Channels: Various platforms or mediums used to deliver advertising messages, such as television, radio, print, digital, outdoor, and social media.  Direct Response Advertising: Advertising that prompts immediate action from the target audience, such as making a purchase or contacting the advertiser.  Brand Positioning: The distinctive place and perception that a brand occupies in the minds of consumers compared to competitors. 15  Advertising and Sales Promotion  Marketing Goals: The broader objectives and targets that an organization aims to achieve through its marketing activities, including advertising.  Benchmark Criteria: The predetermined standards or metrics used to evaluate the performance and effectiveness of advertising campaigns.  Return on Investment (ROI): A measure of the profitability and effectiveness of an advertising campaign, calculated by comparing the cost of the campaign to the resulting revenue or other desired outcomes.  Market Share: The portion or percentage of the total market that a brand or company controls or captures.  Product Life Cycle: The stages that a product goes through from introduction to growth, maturity, and decline, which can influence advertising strategies and budgets.  Competitive Parity: Setting advertising budgets based on the level of spending by competitors in the industry.  Affordability: Setting advertising budgets based on what the organization can reasonably afford without negatively impacting other business operations.  ROI: Abbreviation for Return on Investment.  KPIs: Abbreviation for Key Performance Indicators, which are measurable metrics used to assess the success and performance of advertising campaigns. 1.10 Self-Assessment Questions Essay Type Questions: 1. What are the two main types of advertising objectives? 2. Explain the difference between communication objectives and sales objectives in advertising. 3. What does the DAGMAR approach stand for, and what is its primary purpose? 4. Name three factors to consider when setting an advertising budget. 5. What is the significance of conducting a market and competitive analysis in the budgeting process? 6. Why is it important to monitor and adjust the advertising budget based on campaign performance? Hints for the Essay Questions: a. Two main types of advertising objectives: Communication and sales. 16 Introduction to Advertising b. Difference between communication and sales objectives: Perception vs. sales impact. c. DAGMAR approach: Defining goals and measuring advertising results. d. Factors for setting an advertising budget: Marketing goals, financial resources, and market analysis. e. Significance of market and competitive analysis: Understanding industry advertising landscape. f. Importance of monitoring and adjusting: Optimizing budget based on campaign performance. 1.11 Post Unit Reading Material  https://itsaugust.com/nature-scope-and-benefits-of-advertising/  https://www.managementstudyguide.com/objectives-importance-of- advertising.htm  https://www.marketing91.com/dagmar/  https://www.consuunt.com/dagmar-model/  https://www.hindawi.com/journals/complexity/2020/6162056/  https://blog.hubspot.com/sales/sales-objectives 1.12 Topics for Discussion forum  In your opinion, which type of advertising objective, communication or sales, do you believe is more important for achieving marketing success? Share your reasoning and examples to support your viewpoint.  The DAGMAR approach emphasizes the importance of setting specific and measurable advertising objectives. Can you share a real-life example where this approach was effectively applied, and discuss how it contributed to the success of the advertising campaign?  When setting an advertising budget, what factors do you think are the most critical to consider? Are there any additional factors that you believe should be taken into account to ensure an optimal budget allocation? Discuss and share your insights. 17  Advertising and Sales Promotion 18 www.onlinejain.com