1.

Advertising Fundamentals and

Media

 Basics of Advertising : Concept and Features, Significance, Classification of

Advertising, Integrated Marketing Communication (IMC) - Elements, Behavioural
Model (E.K. Strong AIDA), DAGMAR Model (Russell Colley), Hierarchy of
Effects (Lavidge and Steiners)
 Ad Agency : Various Functional Department, Types, Measures for gaining and
reasons for loosing clients, Evaluation Criteria for Selecting an Advertising
Agency,
 Media : New Media Options, Forms of Digital Media, Media Objectives, Criteria
for Selecting Suitable Media, Methods of Setting Advertising Budget

Basics of Advertising: Concept

Advertising is a form of marketing communication used to attract the attention of the target
audience to take some action, generally positive action. Advertising has taken from the Latin
word “ad vertere”means "To turn mind toward". Advertising messages are usually paid for
by sponsors and viewed via various indoor and outdoor media, including mass media such as
Newspaper, Magazines, TV, Radio and outdoor media or direct mail; or new media such as
SMS, blogs, websites, 3D, Viral ad etc;
Philip Kotler and Armstrong provide a definition:"Advertising is any paid form of non-
personal presentation and promotion of ideas, goods and services through mass media such as
newspapers, magazines, television or radio by an identified sponsor".
The American Marketing Association (AMA) has adopted a definition of advertising, "Any paid
form of non-personal presentation and promotion of ideas, goods or services by an identified
sponsor."
Features of advertising
1. Paid form: Advertising is always a paid form of communication and hence commercial
in nature. Thus, advertising can clarify be distinguished from publicity which is not paid
for by the sponsor
2. Non-personal presentation: Advertising is a non-personal presentation. Whatever the
form of presentation, advertising is always directed to a mass audience rather than to any
individual. At time:, e advertising message may give the impression of a personal appeal.
However, all the sensations are non-personal in nature.
3. Promotion of goods and services: Advertising is aimed at promoting and selling not
only tangible and physical goods, but also various services. Most often services like
banking and insurance are sold through advertising.
4. Promotion of Ideas: Selling of the scope of advertising is wide and designed to sell not
only goods but services and ideas also.
5. Identified sponsor: Advertising always has an identified sponsor. In other words,
advertising discloses or identifies the source of the opinions and ideas it presents. On the
other hand, the sponsor for publicity or propaganda can remain anonymous.
6. Speedy and Mass Communication: Advertising is a speedy medium of communication.
Besides being speedy, its operational area is very vast. In other words, it reaches millions
of people simultaneously.
7. Inform and persuade: Advertising usually informs the potential consumer about
products and services, their benefits and utilities. It also persuades the consumers to
purchase such products and services.
8. Marketing Mix: While advertisers promote their products, they generally used
combination of marketing mix in the advertisements therefore customers will inform
about the product features, price, availability of the product or place and promotional
techniques used by the advertisers. So the marketing mix is one of the important feature
in advertising.

Benefits of advertising to Business firm

New Product entry Inform about New Product
Creation of Demand Competitive advantage
To face Competition Availability of Market
Enhancing Goodwill Easy availability of goods
Informing about the product Changes Educates Consumers
Neutralizing Competitor’s Advertising Social Awareness
Create Monopoly Elimination of Middlemen
Brand Identity Entertainment
Promoting Action Better Quality Products
Close relations with the customer Reasonable prices
Purchase Persuasion More Employment Opportunities
Education Higher Standard of Living

To business firms To consumers

1. New Product entry: New product needs proper introduction and advertisements can
create introductory awareness about a new product in the market as potential customers
have never used such product earlier. Advertising may give an opportunity for new
product to enter in the market easily.
2. Creation of Demand: The main function of the advertisement is to create a demand for
the promoted product/brand and improve its selling. Through advertisement, customers
are to be reminded about the product and the brand and it may induce new customers to
buy the product.
3. To face Competition: It is a very important function of the advertisement as every
marketer wants to survive and stable in the competitive market. Advertisement can give
strength to face market competition and helps to build up brand image and brand loyalty.
4. Enhancing Goodwill: Good and regular advertising often enhancing the goodwill of the
advertising company. This, in turn, increases the market receptiveness of the company’s
product and helps the salesmen to win customers easily.
5. Informing about the product Changes: Whenever changes are made in the prices,
quality, size, weight, brand, packing, etc., in the product by way of any improvement or
modification, the advertiser must be informed to the public through advertisement.
6. Neutralizing Competitor’s Advertising: When competitors are adopting intensive
advertising as their promotional strategy, it is reasonable to follow similar practices to
neutralize their effects. In such cases, it is essential for the manufacturer to create a
different image of his product through creative advertising.
7. Create Monopoly: From the advertiser’s point of view, a strongly built image through
long advertising helps to keep new entrants away. The advertisement builds up a certain
monopoly is for the product in which new entrants find it difficult to enter.
8. Brand Identity: Brand identity is one of the biggest functions and effects of
advertisement. The right advertising campaign defines a company’s unique brand, which
helps consumers build emotional relationships with that brand.
9. Promoting Action: Advertising’s purpose is to attract buyers through a call-to-action
statement, which encourages the customer to visit a store or website, or to contact the
advertiser for more information.
10. Close relations with the customer: A business requires a constant customer base in
order to remain successful. Advertising helps strengthen the purchasing behaviours of
customers for a particular brand, and it establishes long-term relationships with various
customers,
11. Purchase Persuasion: Powerful advertisements persuade consumers to purchase a new
product. Persuasion is one of the main functions of advertising, which is why many firms
strive to create powerful impacts that reach customers on emotional and physical levels.
12. Education: Advertising serves as a form of consumer education. Government agencies
use advertising as a way to educate and compel consumers to act a specific way.
Advertising also educates consumers on what products and services out are there, how
much they should pay, and what they can expect with certain purchases.

Benefits of advertising to Consumers

1. Inform about New Product: Advertising plays significant role to provide information
about new product in the market. Customers are benefited with the information of the
new product and it stimulates themto purchase the product.
2. Competitive advantage: Advertising is greatly helpful in meeting the forces of
competition prevalent in the market. Continuous advertising is very essential in order to
save the product from the clutches of the competitors.
3. Availability of Market:It enables the manufacturer to expand his market. It helps in
exploring new markets for the product and retaining the existing markets. It can create
new place and opportunity of new market nearby to the customer’s resident and
conveying such message to the customers living at the far flung and remote areas.
4. Easy availability of goods:Advertisement facilitates mass production to goods and
increases the volume of sales and providing intime information about such goods hence
consumers are privileged with easy availability of products and services in the near
markets.
5. Educates Consumers:Advertising is educational and dynamic concept in nature, which
is familarising the customers with the new products and their diverse uses and also
educates them about the new uses of existing products.
6. Social Awareness: Social advertising is creating awareness about the social issues in the
consumers and consumers will learn and solve their social issues in best manner due to
such awareness.
7. Elimination of Middlemen:It aims at establishing a direct link between the
manufacturer and the consumer, thereby eliminating the marketing intermediaries. This
reduces the cost of production and there-by product and the consumer gets the products at
lower prices.
8. Entertainment: Today’s advertising is creative in nature which uses creative dialogue,
jingle, Music, Songs, Slogans and many more entertaining elements like graphics and
animations hence such creative ads are entertaining the customers.
9. Better Quality Products:Different goods are advertised under different brand names. A
branded product assures a standard quality to the consumers. The manufacturer provides
quality goods to the consumers and tries to win their confidence in his product.
10. Reasonable prices:Advertising is creating demand which is helping to reduce the cost of
products and customers are getting such products on reasonable prices. Also due to the
immensecompetition in the market many of the producers are selling their products on
reasonable price for retaining in the market.
11. More Employment Opportunities:Advertising provides and creates more employment
opportunities for many talented people like painters, photographers, singers, cartoonists,
musicians, models and people working in different advertising agencies. Other way,
advertising is creating more demand which will turn into more sales and profit. It can
inspire the manufacturer for expansion and such expansion needs more employees.
12. Higher Standard of Living:In the words of Winston Churchil “advertising nourishes the
consuming power of men and creates wants for better standard of living.” By bringing to
the knowledge of the consumers different variety and better quality products, it has
helped a lot in increasing the standard of living in a developing economy like India.
Classification of advertising: Geographic, Media, Target audience and Functions

Classification of
Advertising

Area Based Audience Based Functions Based

Media Based

Indoor Outdoor/OOH
Local
Regional PLC
Consumer Imformative
National Professional
International Persuasive
Traders Reminder
Hoarding
Newspaper Manufacturer Primary demand
Kiosks
Magazine Distributors Selective demand
Neon sign
TV Banners Product/Service
Radio Wall Painting Institutional
Internet Transit
Ariel

Area base
Local ads: When local manufacturers advertise their products in the local magazines or dailies
or give ads through local channels of cable T.V., it will fall in the category of local advertising.
For e.g. advertising in Mumbai city for educational classes
Regional ads: The ad is provided for one of the region and regional people through regional
media like posters, regional newspapers, regional T.V. which are situated in that particular
region, for example ad in Maharashtra
a) Rural advertisement: The ads are provided in rural areas for rural people, including
advertising on rural products, for instance ad of tractor in Konkan area
b) Urban: The ads are provided in urban areas for urban people, including local
Products, for e.g. ad of educational classes (Mahesh Tutorials)
National ads: The advertisement provided only at national level for one of the country with help
of various media including indoor as well as outdoor media. For e.g. advertising in India for
Indian people
International ads: The ad provided to all world people is at an international level, such as ad
from India, China, America, etc. publish on international media
Media base:
A) Indoor
Newspaper ads: The ads are basically prepared for the readers and printed in the Newspapers.
Such ads are called Newspaper ads
Magazine ads: These ads are also prepared for the readers, but are printed in the Magazines
TV ads: Suchads come on television for viewers. These are creative and attractive and prepared
with the help of audio, music, motion and video.
Radio ads: These ads are prepared only for listeners. Radio ads are launched on Radios with the
help of audio and music. Voice module is important in Radio ad.
Internet ads: The Ads are created for the internet and put on websites. People are using the
internet all over world so these are important due to large coverage.
B) Outdoor (OOH- Out Of Home):
Hoarding: A hoarding is 24 feet long and 12 feet high and is on a wooden plank (sheet)
Kiosks: The ads on roads dividers or divided footpath or any marketplace is called kiosks this is
a very popular medium in OOH.
Neon signs: These are glittering ads and can observe at night. These are electrical ads which one
can watch at night and attract the attention of passerby.
Banners: Banners are used for a short period of time as banner ads do not have the back support
and ad is printed or painted on cloth or flex printing
Wall painting: The ads on the walls are fully painted by ad agencies. These are painted on wall
well as on shutters of the shop or house in the rural area.
Transit ads: It included an internal or outer area of the following vehicles
Taxi/cab ads: The ad provided by the advertisers on the door of the taxi/cab or the backside of
the vehicles and as well as on top of the vehicles.
Bus ads: The bus is fully painted with ads. Such buses are capturing max locality in the city or
also out of the city. Nowadays internal ads are very famous in the buses included painting and
electronic like TV
Auto rickshaw ads: Autos have small places for ads and most of the ad companies put ads in
editorial format and does not give importance to illustrations, i.e. Pictures
Train ads: Ad agencies are hired outer or inner places of the trains for advertising purposes
which are costly but coverage area is large.
Aero-plane ads: A part of the plane is fully painted by the products or services that it has flown
from one country to another which will provide international coverage to advertisements.
Aerial ads: It included
Sky writing aids: The advertising company writes the name of the brand /company in the sky
with the help of smoke or gas. It will attract attention of the consumers.
Balloon ads: Now a day, advertisers advertise their products on gas balloons with the help of
printing or painting. It is released into the sky to attract the people.
Inflatable: The shape of the balloon is about the product and is filled with gas and is usually
exhibited on the floor to attract customers’ attention.
Blimps ads: The balloon with the shape of a rugby ball filled with helium gas and is painted
with advertising messages. While flown in the sky attracts the customers.
Hot air balloons: It comes in different shapes and sizes, but a basket is always attached to it.
They are fully painted and show messages and use hot air and the law of convection to fly.
Airship ads: In foreign countries, a plane is fully painted by the product illustration that it has to
advertise and then it flies over the city with low altitude so that will cover most of the locality
Audience base
Consumer ads: The ad is prepared by advertisers to sell the products or services in the market
are consumer advertising. Such advertising is for prospective buyers to create demand
Professional ads: The ad provided by professionals like advocates, doctors, CA. They are
provided advertisement for their services and ask fees from consumers.
Trader ads: They are providing ads for trading services such as availability of transportation
warehouse etc
Manufacture ads: The manufacture, uses the raw material for the preparation of ready materials
and later, advertisers provided ad on ready products are called manufacture ads
Distributor ads: These are provided by the distributor for selling their products easiest way to
the consumers. They are only engaged in selling of products produced by another manufacturer
Functions base
Functional base: It included
PLC stages advertisement: It is the type of advertising which is important and main points in
the marketing mix. The purpose of this is to give information about characteristics like size,
colour shape, after sales service, direct and indirect action, etc; it includes Product Life Cycle
stages, which are in three forms:
a) Informative or pioneering or Introductory stage ads: The advertisers make the
announcement of the introduction of new product and inform the customers. It is also called
pioneering ads during the introduction stage of PLC. The advertisers provide maximum
promotion expenses and use indoor and outdoor media advertising.
b) Persuasive or Competitive or Growth stage ads: It is used while the product is passing
through the competitive stage. The producer has to face a lot of competition in the market so
they are using various promotional strategies for the survival. It persuade potential customer
towards product and they induces for action.
c) Reminder/Retentive or Maturity stage ads: These ads are serving as reminder to the
people so that they should buy the product regularly from the exiting producer. It is used at
the maturity of the Product's Life Cycle For example, pulse polio campaign
d) Saturation stage: To attract more customers while the product is on saturation stage inthe
market, the advertisers prepare competitive social or sales promotional ads for its survival.
e) Decline stage:At this stage many of the advertisers prepared lots of ads to save a life of a
product and some of the advertisers neglect advertisements at this stage and later withdraw
the product from the market
Primary demand Ad:When a product is in the introductory stage or when the demand for a
product in general is promoted, it is called Primary Demand advertising, for example, ‘Sunday
Ho Ya Monday, Roz Khao Ande’. The Milk Association of India when says, “Piyo glass full
doodh” is an ad promoting the drinking of milk by people in general and is not brand
specific.Itrefers to advertising messages that promote the merits of a product category rather than
particular brand.
Selective demand Ad: Selective demand advertising involves the placement of advertising
messages intended to persuade customers about the benefits of the specific brand. Selective
demand ads typically identify the brand through name mention verbally or in written copy, or
show the brand's product clearly. For e.g. Amul Milk Tetra pack ad
Product base:It included
a) Consumer product ads: The ad is on Fast Moving Consumer Goods (FMCG)is called
consumer product ad. It covers maximum customer due to extensive use of an indoor as
well as outdoor media.
b) Industrial product ads: The ads prepared on industrial products for industrial users are
called industrial ads. It includes ad on raw materials, equipments and machineries.
c) Pharmaceutical ads: The ads on drugs and medicines are called pharmaceutical ads.
d) Agricultural ads: Ads on an agricultural product for an agriculturalist or a farmer is
called an agricultural advertising which is launched in rural areas with the help of wall
painting, banners or hoardings.
e) Electronic product ads: The ads on electronic products. For e.g. LG TV
Service baseadvertising:
It is necessary in case of services such as Hotels, Clubs, Airlines, Banking, Insurance,
Transportation, Health club etc; which are increasing day by day and they are taking support of
ads for the development of the activities benefits and conveniences which offer to the customers
through advertising, it can help local community and ask to take the benefits offered by them on
charges fixed by the company. They used all types of media for advertising
a) Banking services ads: The ads on home loan, educational loan, debit/credit card or ATM
and various such banking services has called banking services ads
b) Tourism ads: Tourism ads that promote the specific attractive area of the country/city.
It attracts the attention of the tourists.
c) Insurance ads: The ads provided on insurance services for the protection of life and
goods and safety purpose is called insurance ads
d) Health center ads: Such ads promote the importance of Yoga, Ayurveda and Gyms.
e) Educational service ads: The ad provided on the educational services such available
courses, Facilities to the students etc; by educational institutions is called educational ads.
Institutional ads:
It is designed to cultivate goodwill and prestige of the organisations, the purpose is to promote
the corporate image by creating a favourable image of the company in the mind of public there-
fore it is accounted as a corporate image building ad. It includes social welfare, rural
development programme, social forestry, pollution control programme etc are some examples of
this advertisement. The main objectives are to remind about the products and services, to create
image, to face market competition and to suggest suitable expansion, to create awareness and

Concept of IMC
The American Association of Advertising Agencies defines IMC as "a comprehensive plan that
evaluates the strategic roles of a variety of communication disciplines and combines these
disciplines to provide clarity, consistency and maximum communication impact. "
Integrated marketing communication is integration of all marketing tools, approaches, and
resources within a company which maximizes impact on consumer mind and which results in the
maximum profit at minimum cost. The concept that is designed to make all aspects of
marketing communication such as advertising, sales promotion, personal selling, internet
marketing, sponsorship marketing, direct marketing, public relations etc. and the integration of
all these promotional tools along with other components of the marketing mix to gain an edge
over a competitor is called Integrated Marketing Communication.
The objectives of any marketing communication process are:

 To create brand awareness,

 To deliver information,
 To educate the market, and
 To advance a positive image of the product brand.
Element of IMC

Sales Promotion
Direct
Sponsorship
Marketing

Personal
Selling Advertising
Elements of IMC
Public Relation Packaging &
Designing

Publicity POP
Event
Marketing

1. Sales Promotion: Sales promotion is any initiative undertaken by an organization to

promote an increase in sales, usage or trial of a product or service. Promotion keeps the
product in the minds of the customer and helps stimulate demand for the product.
Promotion involves ongoing advertising and publicity (mention in the press). It includes
promotional techniques like (a) Buy-One-Get-One-Free (BOGOF) (b) Customer
Relationship Management (CRM) (c) New media (d) Merchandising (e) Free gifts (f)
Discounted prices (g) Joint promotions (h) Free samples (i)Vouchers and coupons, (j)
Competitions and prize draws (k) Cause-related and fair-trade products (l) Finance deals
2. 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 catalogues, mailers and fliers.
Direct marketing removes the "middle man" from the promotion process, as a company's
message is provided directly to a potential customer.
3. Advertising: It is very important element in the IMC, which is a paid form of non-
personal presentation and promotinggood and services through ideas which is one
communication tools for the advertisers to attract the potential customers towards their
brands.
4. Packaging and designing: Packaging is the science, art, and technology of enclosing or
protecting products for distribution, storage, sale, and use. Packaging also refers to
the process of design, evaluation, and production of packages. The packaging
and labels can be used by advertisersto encourage potential buyers to purchase the
product. Package graphic design and physical design have been important and constantly
evolving phenomenon for several decades.
5. Point of purchase (POP): It is also called point of sales. A point-of-sale display (POS)
is found near, on, or next to a checkout counter and the previous conveyor belt. They are
intended to draw the customers' attraction to products, which may be new products, or on
special offer, and are also used to promote special events, e.g. seasonal or holiday-time
sales. POS displays can include shelf edging, dummy packs, display packs, display
stands, mobiles, posters, and banners.
6. Event Marketing: The activity of designing or developing a themed activity, occasion,
display, or exhibit such as a sporting event, music festival, fair, or concert
to promote a product, cause, or organization. It is also called event creation or event
Management.
7. Publicity: Publicity is the spreading of information to gain public awareness for a
product, person, service, cause or organization, and can be seen as a result of effective PR
planning. It is a non-paid form of personal presentation of advertising.
8. Public relations: Public relations is "the art and social science of analysing trends,
predicting their consequences, counselling organizational leaders, and implementing
planned programs of action, which will serve both the organization and the public
interest." Public relations include on-going activities to ensure the overall company has a
strong public image. Public relations activities include helping the public to understand
the company and its products. It is included institutional, Advocacy, political and public
service advertising.
9. Salesmanship or personal selling: Salesmanship or personal selling is just Skill in
selling; Salesmanship is just persona selling - negotiating, emphasizing inducing and
making the prospective buyer to take a decision in favour of going for the product being
offered to him. In the words of W.G. Carter, "salesmanship is an attempt to induce people
to buy goods."
10. Sponsorship: Sponsorship is a financial help or in-kind fee to sponsor something to
support an event, activity, person, or organization financially or through the provision of
products or services. It is also a payment for advertising related to an event or
programme that supports the running of the event or the production of the programme.
11. Online Marketing and Website: Now-a-days online marketing and website links are the
important elements of IMC. The young customers are always online and various websites
hence the advertisers should use the appropriate methods to reach and retain them.
12. Marketing Collateral: The use of brochures, case studies, white papers etc; materials in
IMC is important to build and define the brand image and provide the customer with an
important look at the positioning and messages.
13. Trade shows: Individual meetings will possible by organising of a trade show. No other
opportunity affords the ability to meet directly with so many customers in a condensed
time frameunder one roof. Hence this is one of the best elements of the IMC
Behavioural Model (E.K. Strong AIDA)
The AIDA model was first published by E.K. Strong in 1925, but according to Strong, it would
have been developed by St Elmo Lewis at the end of the 19th century. According to Lewis
AIDA is commonly attributed to American advertising and sales pioneer, E. St. Elmo Lewis. In
one of his publications on advertising, Lewis suggested at least three principles to which an
advertisement should conform. According to F. G. Coolsen, "Lewis developed his discussion of
copy principles on the formula that good copy should attract attention, awaken interest, and
create conviction.” But according to Strong AIDA is a simple acronym that was devised a long
time ago as a reminder of four stages of the sales process. AIDA stands for Attention, Interest,
Desire and Action.
It is, in modern terms, a fairly simplistic model. This does not mean that it is no longer of value--
it simply means that it is not the whole story. The bottom line is that it is useful to use it as a
checklist and guideline, but not as the only checklist or guideline.The acronym AIDA is a handy
tool for ensuring that the advertising copy, or other writing, grabs attention. Including “C” the
acronym stands for Conviction

Attention (or
Attract)
Interest

Desire
Conviction
Action.

These are the four steps need to take the audience through if company want them to buy the
product or visit the website, A slightly more sophisticated version of this is AIDCA/AIDEA,
which includes an additional step of Conviction/Evidence between Desire and Action.
How to Use the Tool: Use the AIDA model when you write a piece of text that has the ultimate
objective of getting others to take action. The elements of the acronym are as follows:
1. Attention/Attract:It needs for advertisers to grab people's attention towards their messages
through advertisement. Use powerful words, or a picture that will catch the reader's, viewer’s eye
and make them stop and read/watch what advertisers have to say for effective sale of the their
products or services. The attention portion of the marketing message occurs at the beginning and
is designed to give the prospects a reason to take notice. Presenting a shocking fact or statistic
that identifies a problem which can be solved by the product or service is one common method
of gaining attention. Other methods can include asking a thought-provoking question or using the
element of surprise or including animations, graphics, and attractive jingles or music etc;. The
purpose is to give the prospects a reason for wanting to learn more.
2. Interest:Once you've gained the prospects' attention, the next step is to maintain interest in
your product or service to keep the recipients engaged. This is one of the most challenging stages
in the AIDA model. Advertisers have to get the attention of a piece of the target audience, but it
is difficult to the advertisers to create recipient’s interest in their advertised products or services.
A demonstration or illustration can help the recipients to further identify with the problem and
want to actively seek possible solutions.
Advertisers must stay focused on the recipients’ needs. This means helping them to pick out the
messages that are relevant to them quickly. So use bullets and subheadings, and break up the text
to make your points stand out for print media and use jingles, story, theme, songs in broadcasting
media for creating interest.
3. Desire: In the desire stage, the objective is to show the prospects how the product or service
can solve their problem. The Interest and Desire parts of the AIDA model go hand-in-hand: As
advertisers are building the reader's/viewer’s interest, also need to help them understand how
what advertisers’ offering can help them in a real way. The main way of doing this is by
appealing to their personal needs and wants. Also explain the features of the product or service
and the related benefits and demonstrate how the benefits fulfill the need. A common advertising
process is the "before and after" technique, such as when a cleaning product makes a soiled item
look brand new. If done effectively, the prospects should now have the desire to make a
purchase.
4. Action: After conviction the last step is creating action to make a purchase, the final step is to
persuade the prospects to take immediate action. In a one-on-one sales process, this is the time to
ask for the sale. In the advertising world, techniques involve creating sense of urgency by
extending an offer for a limited time or including a bonus of special gift to those who act within
a specific time frame. Without a specific call to action, the prospect may simply forget about the
offer and move on.
5. Conviction: According to F. G. Coolsen Lewis developed his model by introducing one more
step in AIDA i.e. Conviction so called as AIDCA. This is more important step as convince
recipients is very difficult for advertisers because they are very tend to be skeptical(doubtful)
about marketing claims. So for this give some offers to the dealers or shopkeepers to recommend
the products also advertised by exhibitions and use sales promotions.

DAGMAR Model (Russell Colley)

DAGMAR--Defining Advertising Goals for Measured Advertising Results, Russell Colley
(1961) developed a model for setting advertising objectives and measuring the results. This
model was entitled ‘Defining Advertising Goals for Measured Advertising Results- DAGMAR.’
The model suggests that the ultimate objective of advertising must carry a consumer through four
levels of understanding: fromunawareness to Awareness—the consumer must first be aware of a
brand or company Comprehension—he/she must have a comprehension of what the product is
and its benefits; Conviction—he/she must arrive at the mental disposition or conviction to buys
the brand; Action—finally, he/she is actually buying that product.
1. Awareness: Awarenessof the existence of a product or organization is necessary before the
purchase behaviour can be expected. Once the awarenesshas been created in the target audience,
it should not be neglected. Awarenessneeds to be created, developed, refined or sustained,
according to the characteristics of the market. In situations where:
 Buyer experiences high involvement: Is fully aware of a product’s existence, attention
and awareness levels need only be sustained and efforts need to be applied to other
communication tasks. For e.g. Sahara Homes ad that features Amitabh Bachhan saying
“jaha base Bharat”. Awareness level is low; however, it is a high involvement decision.
Thus, adequate attention is required and awareness levels are raised with use of well-
known and trusted celebrities.
 Buyer experiences low involvement: If buyers have sufficient level of awareness, they
will be quickly prompted into purchase with little assistance of the other elements of the
mix. For e.g. Parle G ad that talks about it being the largest seller “ Duniya ka sabse
Zyada bikne waala biscuit”. Parle G as a brand already enjoys high levels of awareness
and requires a low involvement decision, thus communication is mainly intended to
refine awareness.
2. 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. E.g. (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, (Bollywood actor) which banked on the purity aspect,
is related the purity of the water with that of river Ganga.)
3. 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. E.g. (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.)
4. Action: Communication must finally encourage buyers to engage in purchase activity.
Advertising can be directive and guide the buyers into certain behavioural outcomes. E.g. (Use
of toll free numbers, direct mail activities and reply cards and coupons.Tupperware, Aqua Guard,
is famous in Indian cities as a result of its personal selling efforts.)
Characteristics: A major contribution of DAGMAR was Colley’s specification of what
constitutes a good objective. Fewcharacteristics of good objectives are noted as:
 Concrete: The communication message should be concrete so the customers could
believe the messages and will take necessary action
 Measurable: The communications should be a precise statement of what appeal or
message the advertiser wants to communicate to the target audience.
 Target audience: In DAGMAR the target audience will be well defined. For example, if
the goal was to increase awareness, it is essential to know the target audience precisely.
 Benchmark and degree of change sought: Another important part of setting objectives is
having benchmark measures to determine where the target audience stands at the
beginning of the campaign with respect to various communication response variables
such as awareness, knowledge, attitudes, image, etc.
 Specified time period: A final characteristic of good objectives is the specification of the
time period during which the objective is to be accomplished, e.g. 6 months, 1 year, etc.
 Generate a set: With a time period specified a survey to generate a set if measures can be
planned and anticipated.
 Written Goal: Finally, goals should be committed to paper. When the goals are clearly
written, basic shortcomings and misunderstandings become exposed and it becomes easy
to determine whether the goal contains the crucial aspects of the DAGMAR approach.

Hierarchy of Effects (Lavidge and Steiners)

With the help of six major steps, Robert J Lavidge and Gary A. Steiner were developed “The
Hierarchy of Effects Model” in 1961. This marketing communication model includes the first
step of observe the product through advertisement up to the last step i.e. purchase the product.
Through these six steps the advertiser is encourage the customer to purchase his product.

Awareness

Knowledge

Liking

Preference

Conviction

Purchase
1. Awareness: The advertisers could create awareness about his brand through the
advertisement.This is basically a challenging step as there is no guarantee that after viewing
the advertisement the customer will be aware of the product brand. Customers see many
adverts each day but will only remember the brand of a tiny fraction of products.The
customer becomes aware of the product through advertising.
2. Knowledge: Nowadays the customers are aware about the brands through the digital media.
Apart from the customer begins to gain knowledge about the product for example through the
internet, retail advisors and product packaging. In today's digital world this step has become
more important as consumers expect to gather product knowledge at the click of a button.
Consumers will quickly move to competitor brands if they do not get the information they
want. The advertiser's job is to ensure product information is easily available.
3. Liking: This step is about ensuring that the customer likes the brandor product. Advertiser
should promote the product’s features such way that it encourages customers to like the
product or brand easily.
4. Preference:Consumers may like more than one product/brand and could end up buying any
one of them. At this stage advertisers will want the consumer to disconnect from rival
products and focus on their particular product. Advertisers will want to highlight their brand's
benefits and unique selling points so that the consumer can differentiate it from competitor
brands.
5. Conviction:This stage is about creating the customer's desire to purchase the product.
Advertisers may encourage conviction by allowing consumers to test or sample the product
or encourage them with the help of sales promotion techniques like “Buy One Get One Free”
(BOGOF)or inviting consumers to take a car for a test drive. This reassures consumers that
the purchase will be a safe one.
6. Purchase:According to this step, the advertiser wants the customer to purchase their product.
This stage needs to be simple and easy, otherwise the customer will get fed up and walk
away without a purchase. For example a variety of payment options encourages purchase
whereas a complicated and slow website discourages purchases.
Six Steps and Behaviour
Lavidge and Steiner suggested that the six steps can be split into three stages of consumer
behaviour: cognitive, affective and conative. The job of the advertiser is to promote the three
behaviours.
 Cognitive (thinking) so that the consumer becomes product aware and gathers product
knowledge
 Affective (feeling) so that the consumer likes the product brand and has conviction in it
 Conative (behaviour) so that the consumer buys the product brand

Ad Agency
Advertising agency: The Advertising agency is an agency that designs, advertisement to call
public attention to its clients. It is an independent business organization specialized in advertising
work which undertakes the work of planning, preparing and executing ad campaign for its
clients. It is a body of experts who specialize in advertising.
According to "Advertising Age", the first advertising agency was started by Volney Palmer in
Philadelphia in 1843. Since then, consumer demands and the goals of the businesses that serve
them have changed dramatically
According to Philip Kotler, “Advertising Agency is a marketing service firm that assists its
clients in planning, preparing, implementing and evaluating various activities of advertising
campaign”
According to American Marketing Association, “an advertising agency is an independent
business organisation, composed of creative and business people, who develop, prepare and
place advertising in advertising media, for sellers seeking to find customers for their goods and
services”.
Various Functional Departments

Board of
Director

President/
GM

Vice President Vice president Vice President creative Vice President Vice President
Marketing Services Management & services Accounting services Other services
Finance
Account Account
Media Copy Art Production Traffic
Management Finance Supervisiors Planning

Research & Account Production

T. V.
Development Personal Executives

Sales Radio
Promotion Records

Public Press
Relation

Marketing services: Media

 The media department is responsible for planning where and when advertisements will
appear and buying space or time in Indoor and Outdoor media,
 In small agencies, one person may combine the planning and buying roles.
 Larger agencies have a media department headed by a media director who supervises the
work of a team of planners and buyers.
 The media team may include specialists in print, broadcast or digital media.
 It is also included services like research and development, doing surveys for customers’
review
 Offering various sales promotions to attract customers on behalf of advertisers
Agency Management and Finance services:
 A larger agency may have a management team, including a chief executive and finance
director, together with directors responsible for each of the firm’s departments.
 If an agency belongs to a large group of companies, a member of the management team
takes responsibility for relationships with the board of the holding company.
 This department is looking towards complete management of advertising from
preparation to execution of ad
 Also included financial services such as arrangements and adjustment of finance and
calculations of various advertising budgets of clients.
Creative Services:
 The creative services team consists of visualizers, copywriters, creative directors, and
designers, known as art directors, who work together to develop concepts for
advertisements.
 In larger agencies, a creative director manages teams working on different accounts.
Smaller agencies may only appoint a creative director who works with freelance writers.
 To easily attract the customers, unique ad is very important for advertisers and for this
creative services are necessary.
Account Services:
 The account services team deals with clients and coordinates the work of the agency's
creative and media teams.
 A large agency might have three levels of account management: account director,
account executive and assistant account executive.
 Account directors, who report to the agency’s management team, supervise the work of
account executives and take responsibility for a group of accounts.
 They may also maintain a close relationship with the agency’s most important clients.
 Account executives and assistant account executives report to account directors and
manage the day-to-day operations on their accounts.
Other services:
 Account Planning: Account planners use their findings to develop an advertising strategy
and prepare a brief for the creative team that's working on an advertising campaign. In
smaller agencies, account planning may be part of the responsibility of an account
executive. Larger agencies may appoint a specialist as a member of the account
management team.
 Production: Larger agencies have a production department responsible for managing
advertising campaigns. They set schedules and manage campaign budgets, coordinating
the work of the creative and media departments. The production team also interacts with
external suppliers working on advertising campaigns, such as printers, photographers and
video production companies. In smaller agencies, account executives or creative directors
take responsibility for project management.

Types of ad agencies
1. Full Service Agencies: A full-service agency offers their clients a full range of
marketing, communications, and promotion services, including planning, creating and
producing the advertising; performing the research; and selecting the media. A full
service agency may also offer non-advertising services such as strategic market planning;
production of sales promotion, sales training and trade show materials.
2. Limited-Service Advertising Agencies: Some advertising agencies limit the amount and
kind of service they offer. Such agencies usually offer only one or two of the basic
services. For example, although some agencies that specialize in "creative" also offer
strategic advertising planning service, their basic interest is in the creation of advertising.
Similarly, some "media-buying services" offer a media planning service, but concentrate
on media buying, placement, and billing.
3. Specialist Advertising Agencies: There are also agencies that specialize in particular
kinds of advertising: recruitment, help-wanted, medical, classified, industrial, financial,
direct-response, retail, yellow pages, theatrical/entertainment, investment, travel, and so
on. Specialization occurs in such fields for a variety of reasons. Often, as in recruitment
advertising, for example, specialized media or media uses are involved that require
knowledge and expertise not ordinarily found in a general-line agency.
4. Interactive agencies: Today, the most successful interactive agencies are defined as
companies that provide specialized advertising and marketing services for the digital
space. Interactive agencies may differentiate themselves by offering a mix of web
design/development, search engine marketing, internet advertising/marketing, or e-
business/e-commerce consulting. Interactive agencies rose to prominence before the
traditional advertising agencies fully embraced the Internet with offering a wide range of
services.
5. Search engine agencies: Lately, pay per click (PPC) and (SEO) search engine
optimization firms have been classified by some as 'agencies' because they create media
and implement media purchases of text based (or image based, in some instances of
search marketing) ads. This relatively young industry has been slow to adopt the term
'agency', however, with the creation of ads (either text or image) and media purchases;
they have technically qualified as 'advertising agencies'.
6. Social media agencies: Social media agencies specialize in promotion of brands in the
various social media platforms like blogs, social networking sites, Q&A sites, discussion
forums, micro blogs, etc. The two key services of social media agencies are: social media
marketing and online reputation management
7. Healthcare communications agencies or Medical education agencies: Healthcare
communications agencies specialize in strategic communications and marketing services
for the Healthcare and Life Science industries. These agencies distinguish themselves
through an understanding of the strict labelling and marketing guidelines mandated by the
U.S. Food and Drug Administration (FDA) and industry group guidelines, most notably
ADVAMED and PHARMA. These agencies typically specialize in one of two areas:1)
Promotional education - education and training materials tied to the promotion of a given
product or therapy 2) Continuing medical education - accredited education and training
materials created for continuing physician and medical professional education.
8. In-house Agencies: Some companies in an effort to reduce costs and maintain greater
control over agency activities have set up their own advertising agencies within their own
organizations. This type of agency is set up, owned and operated by the advertiser.
Large companies almost always have in-house agencies and it is common for them to
then outsource certain projects to retain certain “freshness” for campaigns and special
projects.
9. Creative Boutiques: This type of agency provides only creative services which are the
creation and execution of advertisements. Full service agencies often subcontract work
to creative boutiques when they are busy and do not want to hire a full time staff member.
In-house agencies and specialty agencies use these services they want a new “fresh”
approach to an ad campaign.
10. Media Buying Agencies: Media-Buying agencies are independent companies that
specialize in the buying of media, particularly radio and television time. Advertising
agencies, in this case, develop their own media strategies and hire media buying agencies
to execute them. Because these agencies purchase space in large quantities, they receive
discounts and can save the small agency or client money on a media purchase.

Measures for gaining clients

1. Share previous case studies: It is important to share previous case studies with your
client, that reveal the agency’s style of communication and collaboration, processes for
executing on and delivery work, and the results the agency achieved for clients also share
testimonials from previous clients. It can avoid the client turnover
2. Set expectations:If agency don’t set expectations and communicate these clearly, clients
can easily become upset as they believe the agency can deliver on X results, while in
reality, those results are only seen in month six or with additional projects.
3. Take care separately: The agency’s clients are coming from very different businesses.
One client might feel that agency’s service fee is high, and therefore, they expect an
extremely high amount of expertise, while for another client, agency might be one of
many different agency partners, and the client cares more about the ability to collaborate
than care for their brand. Hence take care separately of each client.
4. Proper approach: Understanding these points of view and communicating deadlines,
progress toward goals, what’s included in a project, process, communication style, etc., is
essential for making sure expectations are met. This, in turn, will keep clients happy with
the relationship for longer.
5. Delivering results and ROI: Clients are more likely to stay with the agency if it is
delivering results and ROI. If a client can point to the fact the agency has influenced or
increased leads, lifetime value, retention, etc., then it will be much more difficult for the
client to say goodbye.
6. Transparency:Be transparent about the activities thatagency executed every time like
selection of media, models or budget and the results predicting by the agency, where
agency see opportunities for improvements, and what it will work on next month. In
addition, use a project management tool that the client can easily see how far along the
team is in a project.
7. Smart Goals: The agency know what type of work the client wants and will approve,
and also understand what works to reach their goals. That means agency needs a good
system for tracking and reporting on the metrics that really matter to the client, which
should relate to the SMART goals agency established together.
8. Build trust with clients:Consistency builds trust with clients. They know what to expect
and can rely on the team to get the work done and deliver the results they need. Without
this, most interactions are a surprise, and in reality, clients don’t like surprises -- even if
they say they want to partner with a more “innovative, fun, risk-taking agency.”
9. Regular Feedback: Ask for regular feedback from the entire client team, including the
decision-maker. Use a client feedback tool, such as Client-Pulse or Client-Heartbeat to
track trends by the client, the individual, or the project. For example: By tracking by
project, agency could identify if client happiness drops after every website redesign
project and agency could work to improve the project.
10. Customer Relationship Management: Advertising agency’s culture, leadership, and
business practices all contribute to retention, but another way to prevent disruption in
changes in personnel is by adopting a CRM system where agency can store notes from
meetings and phone calls, ongoing issues, personal preferences of the clients, etc.
11. Reciprocity: It is a social construct that has been found to increase loyalty. Acts of
kindness create a feeling of obligation in the person who automatically wants to repay the
kindness.There are two kinds of reciprocity, surprise (gift or gesture) and trumpeted
(something beneficial). Both of these can be used in client service to increase loyalty.
12. Relations with entire team of clients:Typically, clients mainly communicate with their
account manager. These individuals form a bond during hundreds of meetings, phone
calls, and emails. The agency’s manager becomes too engrossed in the client’s needs and
wants.
Reasons for Losing Clients

Bad Treatment
Talent
Other
Turnover
reasons
Being
Financial
“Stretched too
Instability
Thin” Reasons
Stagnant
Wrong
business
decisions
Model
Isolated Overpromi
Services sing\Under
In advertising agencies due to competition client retention is difficult day by day. Despite the
best efforts and service of the agency, some client-agency relationships won’t go as planned, and
partnerships will dissolve and because of unavoidable reasons, many clients will leave
advertising agency. If such client numbers are larger, then companies can say that client turnover
is increasing. In simple term client turnover means maximum numbers of the clients are leaving
advertising agencies for one or more reasons. Understanding these reasons can help your agency
avoid and overcome obstacles, and can contribute to more long-term, stable relationships.
Following are some reasons for loosing clients.
1. Financial Instability:Agencies in difficult financial positions may be forced to cut
corners on staffing, remove the good employee, try to hide the real financial position
from the clients, misguided them and take on bad accounts. These situations forced the
clients to leave agency.
2. Wrong decisions: If the agency has taken wrong decisions for e.g. wrong selection of
media, models wrong market place to launch advertisements etc; are not in the long-term
best interest of clients
3. Overpromising/under delivering: In many cases, it is because the agency overpromises
what it can achieve for a client. Expectations get set too high, and when the agency does
not deliver, the client is forced to move on.
4. Isolated Services: Isolated activities within the agency create disconnected customer
experiences. Strategies cannot be built in isolation if marketers want to maximize ROI.
There has to be an integrated approach to a consistent marketing strategy.
5. Stagnant business Model: If an agency is stuck in legacy systems and taking an obsolete
approach to targeting audiences, then clients often need a change of direction to create
the compelling customer experiences they desire.
6. Being “Stretched too Thin”: Financial difficulties, mismanagement, and challenges
scaling to meet market demand can all contribute to agencies being stretched too thin. In
all cases, it is the client that suffers and they are forcing to leave the agency.
7. Talent Turnover:The greatest value the agency can give clients is to stock their account
teams with top-notch, digital-savvy professionals. That said, if the agency struggles to
retain the best talent, then clients have no reason to stay.
8. Bad Treatment: Many advertising agencies have given bad treatment to the small scale
businesses comparatively their large scale clients, it hurts the small industries and they
are leaving the agency.
9. Other reasons: If overexerted over extended periods of time, morale, culture,
productivity and performance are all negatively impacted, which can cause clients to
leave.
Evaluation Criteria for Selecting an Advertising Agency

Product
Adaptable features
Agency size
to Change

Cultural Fit Location

Technologic
Functional
ally
experties
Advanced

Executional Strategic
Excellence Thinking

Ad budget Creativity
Agency self-
promotion

1. Product features: Selection of an agency depends on the products’ features. The agency
generally prepared same kind of products; the clients must give their work to that ad agency
as they know how to prepare competitive ad for various clients for the same products.
2. Agency size: It is best to seek agencies where the budget will place the client in the top three
clients. Therefore, the client can get more attention, more traffic, and more sales.
3. Location: if the client have a wish to meet face-to-face with his account manager on a
regular basis, Unless clients are seeking a global ad firm, or are looking to pay for the travel
costs each time, he may want to seek a local or near advertising agency.
4. Talent and Functional Expertise: There will be a variety of people from different
departments within the agency working in preparation for an ad campaign. Having the right
people involved is essential for the campaign’s success. Most importantly, make sure the
core team is present for the agency’s on-site pitch presentation so that clients can meet each
team member in person to make corrections in the ad
5. Strategic Thinking: If the agency is able to bring new thinking for preparation of the ad,
this may be what sets them apart from the other agencies under consideration. The campaign
messaging and the market in which the campaign is being targeted and deployed can make or
break the marketing promotional efforts.
6. Creativity: An agency must be able to relay the strategic message through the strong
creative work. Successful marketing campaigns typically possess an innovative, creative
element that grabs the target market’s attention and leads to a call to action.
7. Agency self-promotion: Does the Agency care about its own promotion? Does it look to
establish leadership through creation of guides, blogs, and social media? Is the website well-
designed? Does it have videos for viewing? If the agency does care about its own image, it
may be time to opt services from such agency
8. Ad budget: An advertising agency has a proportional or reasonable ad budget, the client
must opt services from such advertising agency.
9. Executional Excellence: Examining the tactics and strategies applied to past campaigns will
help you evaluate the agency’s ability to successfully develop and deploy marketing
programs. Requesting details on how an agency has supported a product launch or early
product life-cycle will allow you to evaluate the agency’s executional capabilities.
10. Category, market segment or product experience: Always chose an agency that has
experience in the market segment or industry. For instance, if the clients have a healthcare
technology company, it would be best if the agency could offer them specific Healthcare
Technology Case Studies for preparation of ad.
11. Innovative and/or Technologically Advanced: In today’s digital environment, it is more
important than ever to have an understanding of technology and the best ways to utilize it
within a marketing program. When evaluating an agency, it is valuable to ensure that
technological capabilities are thoroughly assessed as it relates to the nature of the assignment
and projected scope of work.
12. Cultural Fit: An agency is often considered an extension of a brand team and therefore, if
it does not fit within your company’s culture and share the same vision for your brand, it may
not make sense to on-board that agency. Be sure to establish an understanding of the culture
of each agency under consideration
13. Adaptable to Change. The client can gain a sense of how flexible an agency is during the
sourcing process and how it will address changes effectively without disrupting the overall
flow of the campaign.
New Media Options
New media is the future of advertising. More and more consumers and businesses rely on new
media to find their information. Ultimately, new media refers to content that is easily accessible
via many different forms of digital media. When related to advertising, some examples of new
media include online advertising (retargeting, banner ads, etc.), online streaming (radio and
television) and social media advertising.
1. Digital media: Nowadays new media option is important for advertisers as well
consumers and millennials are attracted towards the digital media for searching
information about the products and services. They are searching this information through
media search engine results pages, banner ads, Rich Media Ads, Social network media,
interstitial ads, online classified advertising, advertising networks and e-mail marketing,
including e-mail.
2. Social media: The new media advertising option, for the sake of space, is the use of
social media e. g face book, whatsapp, Twitter, Instagram, email etc. more powerful and
stronger than the old generation media to reach target audience.
3. Aerial media:It is also called airborne advertising. It can create maximum ‘sky-high’
brand impact and call to action through flying banners and aerial advertising. Flying
banners can be targeted directly to key events or locations while skywriting displays can
be visible up to an amazing 30km radius. These ads are strong clutter-free and engaging
in outdoor advertising option.
4. In-flight advertising: Reach targeted business and leisure airline passengers through a
range of in-flight advertising options including aircraft wraps, locker ads, in-flight TV &
digital itinerary media. Hence it is also called Jet Max Media, which works with both
National& International airlines and allows marketers to geographically target their
advertising reach.
5. Risk Free TV: Pay per response is not just for online advertising. Risk Free TV helps
produce a response driven television commercial and then advertises your product or
service on various TV stations at no cost. Marketers then pay on a pre-agreed cost per
lead generated.
6. Digital Signage: Digital Signage is also called Myst Media a high growth advertising
category with screens appearing within increasing point of sale and other populated
locations. Screens are placed in high traffic areas such as next to the ATM and shop&
mall entrances or airport or railway or bus station. But this media is right now spreading
at Indian locations.
7. FM Radio: FM radio station broadcasting new music and youth culture across India and
the greater metropolitan area. They offer marketers a range of on-air & online options to
reach a passionate and loyal youth based audience.
8. Tissue Paper or Napkin Ad: There are a broad range of ambient advertising options
available to marketers which can offer both impact and high engagement. Also it is one
of the economical medium where they print and distribute branded luncheon napkins
throughout a growing network of food outlets within major food courts& shopping
centres. There are various ambient advertising media including bicycle seat, bus seat,
shop floor, Icy media (ice) etc.
9. Contagious Network: Word of mouth is a proven marketing method also popular as
contagious Network which can now be driven through various social media platforms.
Brands can effectively change consumer attitudes and behaviour and influence their
purchase decisions. Contagious Network identifies targeted brand supporters,
implements and then measures a brand’s social word of mouth activity.
10. Yellow Pages: Reach over 5.5 million individual households or create local area by-
postcode marketing campaigns through this unique envelope pack containing a selection
of non-competing advertising messages and offers. Yellow Envelope packs are delivered
through Australia Post and offer high in-home penetration and measureable results.

Forms of Digital Media

Digital media refers to marketing media that is digitally displayed. Digital advertising
technology exists on the Internet, on smart phone and hand-held media devices, and even on
automobiles and billboards. Hence it is also called internet advertising. Businesses and product
manufacturers use digital advertising to build or maintain a brand image and market products and
services to consumers.Digital advertising includes promotional advertisements and messages
delivered through email, social media websites, online advertising on search engines, banner ads
on mobile or Web sites and affiliates programs.Internet advertising is a form of promotion that
uses the Internet and World Wide Web (WWW) to deliver marketing messages to attract
customers. A type of online advertising that most frequently contains graphic information
beyond text, such as logos, photographs or other graphical elements. Display advertising uses
static and animated images in Web banners, as well as interactive media that may include audio
and video elements. Flash is the preferred format for interactive ads on the Internet. It includes
following forms:
1. Rich media: It is an Internet advertising term for a Web page ad that uses advanced
technology such as streaming video, downloaded applet (programs) that interact instantly
with the user, and ads that change when the user's mouse passes over it. For example: A
cursor that changes to a tiny red question mark on a site.
2. Electronic Billboard:Electronic billboards are display a variety of digital advertising
messages. Digital billboards are cost-effective because several advertisers share the
expense with rotating advertisements. They are flexible because new designs and
advertising messages can be changed within a day or two.
3. Web page media: It includes an interstitial: It is a full page that is inserted in the
normal flow of editorial content structure on a Web site for the purpose of advertising or
promotion. Superstitials: A Superstitials is an exciting format of advertising, but
interrupts the user experience similar to pop-ups. Pop-up ads: Pop-ups are a form of
online advertising on the WWW intended to attract web traffic or capture email
addresses. Pop-ups are generally new web browser windows to display advertisements. A
button ad: 125x125 size box advertisement can be seen on all pages.
4. Banner ad: In the beginning, "advertising" on the Internet meant "banner ads" -- the
728x90-pixel ads you see at the top of almost all Web pages today (including this one). In
1998 or so, banner advertising was a lucrative business. Popular sites like Yahoo could
charge $30, $50, even $100 per thousand impressions to run banner ads on their pages.
5. Email:Email marketing is direct marketing a commercial message to a group of people
using email. In its broadest sense, every email sent to a potential or current customer
could be considered email marketing. It usually involves using email to send ads, request
business, or solicit sales or donations, and is meant to build loyalty, trust, or brand
awareness.
6. Advertorial ad: It is a paid review still happening online particularly through the
blogosphere. An advertorial is an advertisement in the form of an editorial.
7. Affiliate ad: It is formal revenue-sharing or commission based ads – where the publisher
chooses banner, review or text links. Advertisers create or use an established affiliate
network to serve ads and handle the cost-per-action or cost-per-click payment
8. Sponsorship ad: This content brought that unknown brands or businessman paying for
specific valuable pieces of content/video/research or on-going conferences/sites.
9. Search Engine ad: Search Engine Marketing (SEM) is a form of Internet marketing that
involves the promotion of websites by increasing their visibility in search engine results
pages (SERPs) through optimization and advertising. Such as ad on Google page. It also
includes Meta ad: It is a banner ad on the results page of a search engine that is related to
the subject of the search.
10. Viral ad:Advertising messages are spread digitally through email and other online
media. This form of advertising encourages existing customers to tell others about a
product, service or company. The intent is for word to spread like a "virus" to others
within a social group or network.
11. Audio Advertising:Audio advertising is a form of digital advertising that targets
consumers through Podcasts: are digital audio files such as an MP3 that users download
to a computer or personal media player. Internet radio and live streaming: digital radio
play "sponsor" messages that advertise products and services to consumers while they
listen to the radio online.
12. Mobile Media: Digital advertisements through the Mobile phone such as direct call to
customers and giving information or SMS and providing information through small
messages.
Media Objective
Media objectives describe what you want the media plan to accomplish. There are five key
media objectives that a advertiser or media planner has to consider - reach, frequency, GRP,
continuity, cost, and weight. From these three are very important for the advertisers reach,
frequency and GRP
1. Reach:Reach refers the number of people in the Media Market that will likely be exposed
to one Spot it means it is a number, which shows that how many individual (different) saw an ad
at least once, in a defined relevant period of time. Estimating reach is tricky because when you
run an ad multiple times, the same person may see the ad more than once but you only want to
count them once in Reach. One person is counted only once, so in case we display it in
percentage, the maximum can be 100%. Reach can also be expressed as a percentage, which
indicates the percentage of the Population that is exposed to at least one Spot.
The total number of people or households exposed to an ad schedule during a given time period
like 4 weeks; expressed as a % of the total potentially exposed.
For instance:
A radio station has 60,000 potential listeners and 20,000 hear a commercial 20,000/60,000 =
33% or 33 could be reach or another simple way if advertiser organised survey and asked 20
people but advertisement viewed by only 15 people then reach could be 15 (5 people could not
see advertisement at all hence 20 – 5 = 15)
Greater Reach:
 Main objective is to generate awareness
 Easily get the numbers of the viewers
 Understand the popularity of the brands
 If less number of viewers should take corrective measures
 Goal is to target new consumers
 New product aimed at large, broad audience
 Product is newsworthy
2. Frequency: Frequency is the average number of times the advertisement will be
presented to the Reached Population. It is a number which shows that how many times people
see an ad in a defined relevant period of time. It means Frequency refers to the average number
of times an individual within target audience is exposed to a media vehicle during a given period
of time.
It is not a cumulated number but the average of the total number of the viewers. In formula:
“Frequency = Total number of average audience/Reach”.
One way to calculate frequency is to divide the number of impressions by the Reach. Another
way is to divide GRPs by Reach Percentage.
For instance:
Supposed 15 are reach from 20 House-Holds (HH) and total exposures for all HH number were
following way for 4 week of period.
 5 persons viewed ad 20 times (5 x 4 weeks viewed every week)
 5 persons viewed ad 10 times (5 x 2 weeks viewed any two weeks)
 5 persons viewed ad 05 times (5 x 1 week viewed once in week)
 Hence according to formula
“Frequency = Total number of average audience/Reach”
Frequency = 35 (20 + 10 + 5)/ 15 = 2.34
Greater Frequency:
 Goal is comprehension or retention
 Message is more complex
 Target audience is narrowly defined
 Competitor is using high frequency
 Direct response is needed
 Need action in a limited time
 Brand isn’t distinctive
3. GRPs: Gross Rating Points is actually total number of exposure also we can say it is the
weight of the media schedule. The formula used for GRP is GRP = REACH x FREQUENCY
(reach is expressed as a %) for e.g. 100,000 people are potentially exposed to 10 ads and 50,000
people see the ads on an average of 5.4 times 50,000/100,000 X 5.4 = 50 X 5.4 = 270 GRPs
For instance:
In above mention example we have 15 reach and 2.34 frequency hence 15 x 2.34 = 35 which is
our total number of exposure.
4. Continuity - It refers to the pattern of advertisements in a media schedule. Length of
time a media schedule will run and whether it will be continuous or periodic Continuity Patterns:
Continuous spreading the advertising out evenly throughout the campaign
 In Flighting media scheduling strategy ad couldshow alternating periods of advertising
and then no advertising
 Through the Pulsing strategy of media schedule ad could show varying the intensity of
advertising throughout the campaign (combines the two above)
5. Cost - It refers to the cost of different media
6. Weight - Weight refers to total advertising required during a particular period.

Criteria for Selecting Suitable Media

Media selection involves a number of major criteria which influence the decision of the
advertiser and therefore, the same must be considered while selecting the media. The most
significant of these criteria are:
1. The Product: The features of the product have an important influence on the decisions
involving the selection of media. Restrictions also may prohibit use of certain media by
advertisers of specific items like harmful product ad. According to the types of product,
the advertiser will select different media for e.g. consumer product indoor as well outdoor
media can be select but for industrial or technical product may be media like industrial
journals, magazines etc;
2. Types of campaign:The different types of campaign regarding product advertisement
would influence the decision about media selection. These campaigns may be summed up
as an image building campaign, an up-market or down-market image campaign, a direct
sales campaign, a prestige campaign and a trade campaign.
3. Relative Cost: The relative cost is another factor which influences the selection of
media. For e.g. relative cost of the individual media, In case of newspapers, this
relationship is determined as per centimetre per column, and in the case of magazines, the
cost per page is worked out. In case of radio and television, cost will decide as per
commercial minute or per thousand listeners or viewers.
4. The Budget: For advertising budget two major decisions are important i.e. first, how
much is to be spent for advertising and how much budget be allocated for media?
Accordingly advertisers will select media if ad budget is low then they will select one or
two media like print or TV but if ad budget is high then they can select variety of
medium.
5. Clutter: In any medium, the advertiser’s message must compete with other
advertisements for the consumer’s attention. Media in which the advertiser must expect a
great number of competitive messages are termed as “cluttered”. Most newspapers are
highly competitive cluttered media vehicles.
6. Media Audience Measurement: For both print and broadcasting media, three audience
measures commonly used by advertisers are (1) the size of the audience (2) the profile of
the audience and (3) the distribution of exposures among the medium’s audience. For e.g.
if youth is the audience then generally they will select social media.
7. Type of Appeal: The type of message or appeal believed most effective in selling the
product or service will, in many cases, dictate the type of media to be used to carry the
advertising campaign, for e.g. for Bandwagon appeal, Physical senses appeal all type of
media could select but for snob appeal media like class magazines could be select.
8. Features of Audience: In selecting media, the most important determination is the
features of the audience to whom the medium is directed. On the basis of audience
characteristics the media classification is represented as, Newspapers, trade and
professional, general and specialized magazines, direct mail, radio and television, etc.
9. The Objectives of the Campaign: The objectives of the campaign influence media
selection from a somewhat different standpoint. An institutional advertising campaign
may be run in a different media than would a product advertising campaign for the same
company. In the case of product for which the dealer is very important in the ultimate
sale to the consumer, and far more significant than the influence of consumer advertising,
the advertiser may select media primarily for the effect they will have on dealers.
10. Miscellaneous Factors: Several other factors which sometimes enter into the selection of
media are not of enough significance to warrant lengthy discussion, although they may be
of some importance in specific situations.

Methods of setting ad budget

An advertising budget is estimate of a company's promotional expenditures over a certain period
of time. More pertinently, it is the money a company is willing to set aside to accomplish
its marketing objectives.
“An advertising budget spells out the estimated advertising expenditure on various aspects of
advertising, namely, advertising design, copy, message creation, and media and so on. To be
realistic, a budget must be in relation to the expected revenue”.
When the market conditions are studied thoroughly, then the company has to set up its
advertising budget accordingly. For setting advertising budget, there are various methods follow
by the advertisers.
Percentage of Sales: In this method, the budget is decided on the basis of the sales of the
product from previous year records or from the predicted future sales. This is a pure prediction
based method and best applicable to the companies which have fixed annual sales. But if in case
there is a requirement for more promotional activities then this method has a disadvantage
because there will be decrease in advertisements as the budget is fixed. Start with last year’s total
gross sales or average sales for the past few years, and then allocate a specific percentage of that
figure for advertising. Most businesses set aside between 2% and 5% of annual revenues for
advertising. So if your annual sales are Rs. 300,000 then spend Rs. 6,000 to Rs. 15,000 on
advertising.
Illustration:
Prepare Advertising budget for Sun-shine Ltd; for accounting year of December 2017 from the
following
 Company intend its advertising budget on percentage of sales method
 Last year sale of the company is Rs. 500 cr.
 Company set aside 10% of advertising budget on the previous year’s sales
 It distributes among the two brands brand “Sun” and brand “Star” in the ratio of 4:1
 Also it distributes in two different media Magazine and Television in the ratio of 2:3
 Show working notes and table.
Solution:Yearly advertising budget 10% on last year sales i.e. Rs. 500cr
Means ad budget is Rs. 50cr.
Distributed in two brands 4:1
Sun: Rs. 50cr x 4 = 40cr. distributed in two media
5
Magazine: Rs. 40cr x 2 = Rs. 16cr Television: Rs. 40cr x 3 = Rs. 24cr
5 5
Star: Rs. 50cr x 1 = Rs. 10cr. distributed in two media
5
Magazine: Rs. 10cr x 2 = Rs. 4cr Television: Rs. 10cr x 3 = Rs. 6cr
5 5
Advertising budget for Sun-shine Ltd;
December 2017
Brands Sun Star Total
Media Rs. Cr Rs. Cr Rs. Cr
Magazine 16 4 20
Television 24 6 30
Total 40 10 50
Merits:
 It’s easy to understand
 It is safe as company is dealing with a known amount.
 If company is predictable industry, this method is sound.
 This strategy keeps the budget in relation to sales volume
Demerits:
 The budget is based on past performance.
 Company may lose the opportunity to capitalize on shifts in the business climate or
customer trends.
 This method also assumes that sales are directly related to advertising, which isn’t always
the case.
2. Percentage of Profits method/Projected profit:
In this method, companies set their budget at a certain percentage of their current or forecasted
profits. This method is more or less in line with the previous method of percentage of sales.
Illustration:
Prepare Advertising budget for Swanar Ltd; for accounting year of December 2017 from the
following
 Company intend its advertising budget on percentage of profit method
 Last year profit of the company is Rs. 1000 cr.
 This year company is expecting predicted profit 50% more than previous year
 Company set aside 10% of advertising budget on the predicted profit
 It distributes among the two brands brand “Van” and brand “Xan” in the ratio of 2:3
 Also it distributes in two different media Radio and OOH in the ratio of 2:1
 Show working notes and table.
Solution:
Yearly advertising budget 10% on predicted profit i.e. Rs. 1000cr + Rs. 500cr = 1500cr
Means ad budget is Rs. 150cr.
Distributed in two brands 2:3
Van: Rs. 150cr x 2 = Rs. 60cr. distributed in two media
5
Radio: Rs. 60cr x 2 = Rs. 40cr OOH: Rs. 60cr x 1 = Rs. 20cr
3 3
Xan: Rs. 150cr x 3 = Rs. 90cr. distributed in two media
5
Radio: Rs. 90cr x 2 = Rs. 60cr OOH: Rs. 90cr x 1 = Rs. 30cr
3 3
Advertising budget for Swanar Ltd;
December 2017
Brands Van Xan Total
Media Rs. Cr Rs. Cr Rs. Cr
Radio 40 60 100
OOH 20 30 50
Total 60 90 150
Merits:
 Moreover the cost factor is also there which has an effect on profit.
 More profit and less ad budget can save the money of the company
 Expansion will be taken place
Demerits:
 Changes in macro environmental factors like, political, social, demographic, economic
(inflation) and legal the cost component could change the range of profit.
 Instability of the method of budget setting.
 Less profit and more ad budget can lead to losses

3. Unit of Sale Method:

Here ad budget is decided on unit sales by the company. As per this method, company will keep
a side per unit advertising budget and according to per unit ad budget will draw for the
advertising provision. 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.
Illustration:
Prepare Advertising budget for Jwelar Ltd; for accounting year of December 2017 from the
following
 Company intend its advertising budget on Unit of sale method
 Last year sale of the company is Rs. 2000 cr.
 Company is producing two brands Gold 3000 units and Silver 2000 units per year
 The price quoted for the brand Gold is Rs. 280 and Rs. 190 for Silver brand per unit
 Company is keeping aside Rs. 20 for brand Gold and Rs. 15 for brand Silver per unit as
advertising budget per year
 It distributes in two different media Newspaper and Magazine in the ratio of 2:1
 Show working notes and table.
Solution:
Note: Don’t consider last year sale of the company is Rs. 2000 cr. and price quoted i.e. Rs. 280
& Rs. 190
Yearly advertising budget for both the brands
Gold: units 3000 x Rs. 20 = Rs. 60000 ad budgetdistributed in two media
Newspaper: Rs. 60000 x 2 = Rs. 40000Magazine: Rs. 60000 x 1 = Rs. 20000
3 3
Silver: Units 2000 x Rs. 15 = Rs. 30000 ad budget distributed in two media
Newspaper: Rs. 30000 x Rs. 2 = Rs. 20000 Magazine: Rs. 30000 x 1 = Rs. 10000
3 3
Advertising budget for Balaji Ltd;
December 2017
Brands Gold Silver Total
Media Rs. Cr Rs. Cr Rs. Cr
Newspaper 40000 20000 60000
Magazine 20000 10000 30000
Total 60000 30000 90000
Merits:
 Very easy method for understanding
 This method proves more useful especially in the case of advertising of Speciality goods
with higher prices.
 Easy process for setting ad budget
Demerits:
 However this method might not prove efficient for consumer goods of lower price
bracket because the market situations are very volatile and change frequently.
 This method is further undependable in case of fashion products as the market is even
more dynamic.
4. Comparable to the competition:
In this method the total industry average can adopt for ad budgets in an individual organisation.
Many trade associations and industry publications can provide the average amount or percentage
companies spend on advertising.
Merits:
 This is an easy approach for companies with predictable sales patterns.
 Can able to face market competition easily
Demerits:
 It assumes that the industry average applies to all businesses in the marketplace.
 Companies may ignore local market forces and
 They can miss opportunities to increase market share if they stick rigidly to this figure
rather than boost spending.
5. Objective and task-based:
Begin by setting specific marketing objectives and deciding on the tasks required to meet those
objectives. (Example: Increase out-of-state clients by 5% using online promotions.) Then
determine the budget by estimating the costs of carrying out those tasks. If the company can’t
afford to fund all the ideas, rank them and focus on the top few.
Merits:
 It’s an accurate method
 It ties the use of funds directly to the tasks the company want to accomplish.
 If properly executed, the advertising becomes an investment, not an expense.
 By spending whatever is needed, the company may grow at a faster rate.
Demerits:
 If the advertising campaign flops, it can be pricey.
 Company may not recover costs on a bad promotion.
 Need expert for proper advertising investment
6. The maximum amount:
Many of the fast-growing businesses put their faith in this strategy, which advocates setting aside
just enough money to sustain the business, expansion of the business for the future of the family
and then spending the rest on advertising.
Merits:
 Easiest method
 Like most aggressive methods, it offers the reward of rapid growth.
Demerits:
 It is very risky.
 Unless you have a solid reserve to operate your business, you may run it into the ground
if your advertising fails.
7. 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.
In the ROI budgeting method, advertising and promotions are considered investments, like plant
and equipment. In other words investments in advertisements lead to certain returns. Like other
aspects of the firm’s efforts, advertising and promotion are expected to earn a certain return.
8. Affordability
This method is generally used by the small companies. Only the companies which have funds
and can afford advertising opt for this method. The companies can go for advertising at any time
in whole year whenever they have money to spend. The amount spent also varies from time to
time as per the advertisements and availability of the amount takes place.
9. Best guess
In this method ad budget is depending on the guess where the executives of the company see the
market position, competitors, and government policies and then take decision. This method is
basically for new enterprises who have just entered the market and they have no knowledge or
say they are not aware of how the market is and how much to spend on advertising. Thus, this
method is applied by the higher level executives of the company as they are the only experienced
people. This is just on guess hence very risky method.

******
2 Creativity, Social and Regulatory Framework of Advertising

 Creativity &Research: Developing advertising copy - print, broadcast and digital

media, Pre-test and post-test methods.
 Society: Socio-economic contribution and criticisms of advertising, professional
courses and careers in the field of advertising
 Regulatory framework of advertising: Legal Framework of Advertising, Role of
Information and Broadcasting Ministry (IBM), Self-Regulatory Bodies
–Advertising Standards Council of India(ASCI) and Indian Broadcasting
Foundation(IBF)

Advertising Copy
Text of a print, radio, or television advertising message that aims at catching and holding the
interest of the prospective buyer, and at persuading him or her to make a purchase all within a
few short seconds is called an advertising copy, ad copy, or just copy. Although a short
advertising copy is more common in consumer-product advertising, according to the UK
advertising guru David Ogilvy (1911-1999) people do read (and listen or attend to) lengthy
advertisements if they are skill-fully written. Most advertising copy is based on
advertising/consumer research and is composed by professional copywriters hired by advertising
agencies.
Developing advertising copy
1. Exploit the product's benefits: The first step of the copywriting outline is the foundation for
the advertising campaigns. A benefit is the value of product to a customer. In other words, a
benefit is what the product can do for a customer or how the product can help a customer. The
key to success is for the advertiser to fully understand all the benefits of the product it should be
better than the competitor’s product so the customers can relate to them.
2. Exploit your competition's weaknesses: To write compelling copy, it is essential that
advertiser know what differentiates the product from the competition. Once he knowsthe
competitors' weaknesses, he must make sure the audience knows them and understands why
should buy the advertiser’s products. Advertisers want to be able to support the claims if they are
challenged
3. Know your audience: Each ad has a specific audience that will see it, and it's the marketer's
job to find the best placement to ensure the target audience will see it. For example, an ad for
Saree placed near to schools or colleges is not likely to generate a lot of sales. In fact, it would be
a waste of advertising. The target audience for Saree is women. Hence recognise the audience
before preparing the ad copy. There are many attributes you can use to develop a demographic
profile of the customers like Gender, Age, Ethnicity, Family Status, Income, Occupation,
Interests
4. Communicate the goals: There are a variety of reasons to create an advertisement. Before
write a copy for the promotion, advertiser should understand the goals of that particular ad.
There are variety of objectives like communicate a special offer, share information and raise
awareness, generate leads etc; through ad copy customers need to understand how that product or
service is going to help them by making their lives easier, making them feel better, helping them
save money, helping them save time, etc.
5. Focus on "you," not "we”: It is essential for advertisers to address their customers in in
perfect manner in the copy. Remember, writing in the second person (you, your, yours) helps the
audience quickly connect the points in the copy to their own lives and allows them to personalize
the advertisement. This is how the ad is connected to an individual customer's own life.
6. Understand your medium: while writing the copy, be aware that each different medium
where an ad is placed requires a different language, tone or style. While placing the ad in a local
newspaper or use of posters or placing in a woman's magazine or in a news magazine, different
media require for different copy to most effectively persuade a particular audience to act.
7. Avoid T.M.I. (Too Much Information): Never risk losing the attention of the audience by
providing too much detail in an ad copy. Effective copywriting tells the audience what they need
to know to act and make a purchase or how to contact advertiser for more information. Every
advertiser has his fixed advertising budget for placing ads. With each ad, he receives a small
space to get the message across to audience. He must wisely use that place to get the highest
return on his investment.
8. Include a call to action: The goal of any ad is to get back some kind of response from the
audience who sees it. A call to action is the element of copy that tells an audience how advertiser
wants them to respond to the ad. Typically, the call to action creates a sense of urgency around a
message and provides instructions on what to do next. For example, a call to action might tell the
audience to call the advertiser or visit their store or website.
9. Be careful: When advertisers are writing copy, consider if claims that they can't prove in the
copy they will caught in a lie (no matter how small), word will spread quickly, and their
reputation could be irreparably damaged. Again, weigh the risk vs. the potential reward before
they advertise using claims they can't prove. Be careful of using words superlatives such as the
examples like free, Guaranteed, Best, lowest, fastest, your money back, Risk-free, No risk, No
purchase necessary, No cost, No obligation, No investment, 100 percent Promise. No questions
asked etc;
10. Proofread: It is critical that advertiser accurately proofread the copy. One of the quickest
ways to lose credibility in advertising is to allow grammatical or spelling errors to appear in the
advertisement. Customers translate carelessness in ads into carelessness in products and service.
They ask themselves, "If this company doesn't care enough to produce an ad without errors, how
likely are they to care about taking care of me?" hence it should be error free.

Copywriting for print advertising

Print ads are an effective, affordable advertising medium usually find in magazines and
newspapers. Following elements show that how develop copy for print ads which help
advertisers to reach customers and they will reach for their effective selling. While develop print
advertising following elements should consider by the advertisers or advertising agency.

1. Headline: Headline is the first element of copy that reader is going to see in the print ads.
Headline is the part of the ad that first draws a reader’s attention. It is exciting, related to
the visuals, and creates a curiosity that encourages the reader to continue reading. A
strong headline will hook the potential customer and compel them to read more about
your products and services.
2. Subhead: Won't find a subhead in all print ads. A subhead is optional but its purpose is
to expand the headline and draw an attention of the reader in even further.In addition to
the main headline, a subhead can impart secondary information. The headline must grab
readers, but the subhead can explain the deal further.
3. White Space: while the advertiser buying a full-page print ad doesn't mean he has to fill
the entire page with text and images. White space is just as important in the print ads for
more visually appealing, which will pull more readers into your ad.
4. Illustration/Visuals:The purpose of a visual is to create an emotional appeal by
conveying a message without words. Visual can be an image, a photograph, graph, table
and the like that speaks something about the product/brand being advertised. Any images
use in the ad should go hand-in-hand with an ad copy. Photos are best for the print ads
but advertisers can also use illustrations if the product is technical and photos wouldn't
tell the story as well
5. Body Copy: The body of the print ads should be written in a conversational tone. They
have a very limited space to write the copy. Make each word count. Every sentence
should explain what it is selling and why the customer should choose that product.Body
copy is what really sells a product. Hence it is also called sell copy. It contains the
advertisers' offer – what it proposes for sale to the reader. It directs the reader to act,
contains the product details, and stresses how the product will benefit the customer.
6. Slogan: Slogan is a catchy sentence so maximum number of customers remembers that.
It refers punch line or tagline through which the company seeks to occupy a position in
the customer’s mind. They are brief, catchy, simply worded and easy to memorize. Don’t
pick a slogan that simply reiterates your company name."Your slogan should reflect the
experience that you want your customers to have with you."Eg. : DeBeers “Diamonds are
forever” ;Raymonds” The complete Man”;Coca Cola “ThandaMatlab Coca Cola”;
Everest spices “Taste Mein Best, Mummy Aur Everest”; Cadbury Dairy Milk
“KuchMeetha Ho Jaye”, etc. It is important for the advertisers to remind customers very
easily.
7. Logo: Logo is the sign of the company. A company’s logo is a recognition tool for the
public. A logo can be the company name, product name, a symbol or any such mark
which differentiates the brand from that of the others in a crowded marketplace. The ad
copy should always bear the company’s logo to help the prospects recognize and hence
differentiate the advertised product from the rest. For instance
8. Call to Action: As the name suggests, a call to action induces the reader to carry out a
particular action, such as contacting the store for further information or visiting the said
web link and so on. Also, some advertisers use the call to action to create a sense of
urgency. They use phrases such as “call now”, “Hurry!!Offer valid till stock lasts”, visit
the website, receive a discount for ordering before a certain date, get a free trial or offer a
gift with their order. It they want to make their readers act now as opposed to whenever
they get around to it, which is usually never without a solid call to action.
9. Contact Information: Do not forget the contact information. Don't just include the
website only. Put every bit of contact information in all of the print ads.

Copywriting for web advertising

The importance of an Ad copy is the same as for all communication campaigns. The copy text
must be attractive, catchy and very specific, thus allowing us to deliver a clear message.
When the copywriter is write copy for the company he should consider the Ad copy in Ad words
has limitations in terms of specific number of characters that he can use in order to grab the
attention of the users, therefore more attention is required to details in order to achieve better
results. The elements of an Ad are the:
1. The Ad Title: The title is the most important element of an Ad simply because it’s the first
impression to the user. In the title you must include your most popular keywords in maximum 35
characters. These keywords will automatically be highlighted in bold attracting user’s attention.
Consequently there will be a clear answer to the relevant query.
2. The Ad Description: The description is what users are looking after the title. There he can
shortly describe his value proposition. Add his value proposition or a special offer and explain to
the users that his offer provides exactly what they are looking for. Keep in mind that the
description includes 2 lines with maximum capacity of 35 characters per line.
3. Call to action: Till now copywriter has attracted users interest, informed them about what he
offer and now it’s time for a hard selling call to action. Click now, subscribe, book now, look
here, whatever his goal is, he has to add a call to action in order to see results and conversions
from his campaign.
4. The Landing Page: Ad was very effective and the users have finally clicked upon it.
Attention should be paid to the URL that your Ad is pointing to. The URL must point to a well
designed. Note that if the users that are searching for specific query land to a generic home page,
the game is over and the conversion is lost.
5. Optimize your campaign: By testing various ad texts and landing pages to find the ones that
fit best to copywriter business. A small change to the title of his ad or to the call to action may
lead to double conversions. Focus on the target. Stop reading and get the job done!!

Copywriting for Broadcasting- TV-- A 30-second TV commercial

1. Plan Out Video: It's crucial not fill up a bunch of video into the small amount of time for the
commercial. The video should tell the story about what you're advertising even if a customer has
their volume turned down.
2. Writing the Script: Make sure the commercial's script times out in 30 seconds (or however
long you have bought air time for). Use short sentences that grab the customer's attention. You've
got a very limited time frame to capture your audience and you need to get your message across
quickly. Don't get wrapped up in long sentences. Keep them short and punchy.
3. Audio and Video Must Match: When writing the commercial, you must make sure your
audio and video match. You must merge your audio and video to create a powerful sales tool.
4. Call to Action: Call to action gets customers to buy or act now. Don't get to the end of the
commercial and leave off your call to action. You want to tell customers to visit today and give
the contact information, including Web site address, phone number and street address.
5. Stick to Time: Your commercial must time out to the exact time you've paid for. Going over
will only get your all-to-important call to action clipped because those last few seconds will be
cut off when your commercial airs.
6. Hiring a Production Company: Of course, you want your commercial to be professional.
You can hire a production company or many television stations have their own production
companies in-house. They can handle all aspects of your commercial, including writing, shooting
and editing your commercial.
7. Scheduling Commercial: Placement of the commercial is very important. It determines who
will see this commercial and how much you will pay for its air time. If your commercial air at 3
a.m. will save you money but you don't reach your audience and it’s not money well spent.
8. Frequency: Television is less demanding on frequency than radio but it still deserves more
than a one-shot deal. On the local level, you need to identify the key times your ad should run
and buy enough air time for your commercial to reach your audience at least twice.
9. Consistency: Use the same announcer, jingle, fonts, colors, etc. to keep your commercial
consistent. This helps people start to get to know your company by all of these factors.

Copywriting for Broadcasting- Radio

Radio is an affordable ad medium that can reach a mass audience. These five keys help increase
your chances of having a successful radio ad campaign.
1. Starting out: It is essential that you have at least a couple of years’ experience in advertising
agencies before you break into radio writing. Most radio stations administer a test where you
have to write radio scripts for promos or ads – they test how you fare without the crutch of a
picture.
2. Frequency of Ads: Running your commercial once a week for a month isn't going to be
enough. Frequency refers to how many times your ad airs in a short amount of time. A
commercial that airs multiple times in a day has a better chance of reaching the listener than a
commercial that only airs a few times in a week.
3. Target Audience: Just like with every ad you create, you must know your target audience.
Make a list of the radio stations in your market. Listen to each one to help identify your own
target audience. What kind of listeners will be tuning in and are they a potential customer for
your product or service?
4. Producing Commercial: Unlike television commercials, production is more simple for a
radio commercial. You need a script and voice talent. Voice talent can be as simple to find as
calling the radio station.
5. Writing for the ear: A writer has very little to do here. The age of radio plays and serials are
long gone too. Today, it is all about instant gratification. So if you hear a song that you do not
like, you immediately switch to the next channel. So the writing for the ear is very important.
6. Radio Spots: Radio writing has become a specialized form of advertising today. The main
revenue at FM stations comes from ad spots and sales. Therefore, a radio copywriter take briefs
from the client on brands they want to advertise on the radio channel, and come up with 2-3
concepts for the pitch.
7. Sound and music: It is extremely challenging, rewarding and encourages you to explore
sound and music arrangement like never before. So a copywriter’s job is doubly difficult – come
up with something original sound and music without deviating from the core advertising pitch.
8. On air promos: The radio writer’s job is to come up with scripts for promos of all the radio
shows. From shows that play old hits , top 10 countdown every weekend, most-heard prime-
time shows to new promos for the radio station as a whole – it is a copywriter’s job to keep the
radio station sound exciting and new.
Some essentials you must keep in mind while writing anything for radio:
 Keep it short and sweet. Most radio spots and promos are 30 to 60 seconds long and this
includes the name of the brand/show, tagline and/or time and day of airing.
 Awkward sentences, unnecessary words, clichés – do away with them all.
 Audio is unforgiving. A line that may seem ok when written might be a mouthful when
spoken. Read aloud repeatedly and hear it for yourself.
 Do not forget to think of sound effects, music, and other such audio devices that will add
to the radio script.
 Radio is colloquial. Forget grammatically correct; just concentrate on what sounds fun
and easy.
 Keep the personality of your radio station in mind for channel promos. If it is Radio
Mirchi, it has to be edgy and fun, if it is Red FM – it has to be tongue-in-cheek; and if it’s
Radio City – it is all about good music. Get your basics in place.
 Most radio stations are Hindi, so you need to be a good Hindi copywriter. But all leading
radio stations today have a presence in Kolkata, Pune, Bangalore, Chennai and other
cities too where they look for writers in the respective regional language.
 Think crazy, edgy, out-of-the-box. Radio writing is all about innovation and breaking the
mood.
Objectives and methods of pre-testing and post-testing ads

Types of
Advertising Test
Pre- Testing Concurrent Post-
Testing Testing

Qualitative Quantatative
Methods methods
Consumer
Diaries
Recognition Test
Co-incidental
Starch Test
Telephonic
Bruzzone Test
Surveys
Mechanical Recall or Impact
Opinion and Projective Checklist Method: Electronic
laboratory Test
attitude tests techniques. Consumer Jury Devices
methods Association test
Method: Interview Test
Passers-by count
Sales Area Test: Passers-by-
test
Questionnaire Count test
Customer diary
Tachistoscope Depth Method:
Direct Questioning test
Eye camera interviews Recall Test:
Focus Group:
Psychogalvano Word Reaction Test:
In-depth Interview:
meter Association and Readability Test:
Projective Techniques
Pupillometer
Dummy advertising
Sentence
media vehicles:
Completion”
Paired comparisons:
Tests
Advertising concept test-
Thematic
Central Location
Apperception
Projection Tests:
Tests:
Live Telecast tests:
Attitude Ratings
Trailer test-
In-home tests-
Telecast test:

Methods of Test

Following are the types of test applied in advertisement evaluation:

 Pre-Testing
 Concurrent Testing
 Post Testing
Pre-Testing
Advertising can be pretested at several points in the creative development process. Pre-Testing
helps the advertiser to make a final go or not to go decision about finished or nearly finished
advertisement. Pre-Testing method refer to testing the potentiality of a communication message
or ad-copy before printing, broadcasting, or telecasting. Following are the types of pre-testing
methods: Given that most advertising is assigned the task of achieving specific
communication goals, a number of methods have been developed for pretesting these
communication effects. These may be broadly grouped under three categories:
 Opinion and attitude tests
 Mechanical laboratory methods and
 Projective Techniques
A. Qualitative Methods of Pre-Testing

OPINION AND ATTITUDE TESTS

1. Direct Questioning: This is a method designed to obtain a full response from the
viewers of the advertising by asking direct questions. Based on the responses,
researchers can conclude how well the advertising messages convey to the ultimate
customers in proper manner.
2. Focus Group: Focus group involves exposing the ad to a group of 8 to 12 respondents.
Focuses groups are used with surprising frequency for making final go or no go decision.
It is a free- discussion conducted among small groups of people and led by a
“moderator”. The group may be interviewed on their reactions to advertising concepts
or finished campaigns. Focus groups are used extensively by Indian advertisers.
3. In-depth Interview: In-depth interview involve face to face discussion with respondents.
Interviews are very effective when a researcher has a good idea of critical issues but does
not have a sense of the kind of responses one will get. This method can be effectively
used to generate new ad concepts and ideas.
4. Projective Techniques: In this technique the respondent is instructed to project himself
into the situation and verbalize the thoughts. Projective technique can be very effective
for evaluating ad concepts and for generating new ad concepts. But, it cannot be used for
making final decisions.
5. Dummy advertising media vehicles: It involves placing the test ads in a dummy
vehicle, which resembles the actual advertising medium. In case of television
commercials, the effectiveness of these may be tested by showing respondents an actual
television programme, with the test commercials placed within it.
6. Order-of-merit test: This is used mainly for pretesting print ads in finished form. A
group of people are shown a series of advertisements, and here, jury member rank
different ads according to their preferences. Best ad-copy is given the first rank and the
worst ad copy is given the last rank.
7. Paired comparisons: This is used when more than six or seven ads have to be rank
ordered. Consumers are then asked to judge two ads at a time, and asked to choose which
one is better. In this method, jury members rank the ads on one-to-one basis, i.e. at one
time, they are shown only two ads and are asked to select the better ads. In case, number
of proposed ads is many then each ad is compared with all other ads. The number of
comparison in this method will be No. of comparison= n (n-1)/2 Here ‘n’ stands for no.
of proposed ads.
8. Advertising concept test: This testing is done while developing advertisement copy.
Various aspects of ad-copy such as proposed statements, headlines, visuals, colours,
print-type etc, are selected and are shown to selected individuals. On the basis of answer
given by selected member regarding best headlines, visual, colours etc advertiser
finalizes the ad-copy.
9. Central Location Projection Tests: This is used for pretesting broadcast
advertising. Test commercials are shown to a group of respondents along with
other commercials, at a central location. Questions are asked before and after exposure to
determine whether the commercial have been successful in gaining attention, increasing
brand awareness and comprehension, and shifting attitudes.
10. Live Telecast tests: Here, test commercials are shown on closed-circuit or cable
television. Respondents are then interviewed on the phone to test their reactions.
11. Attitude Ratings: Similarly, people may also form positive or negative attitudes
towards ads. It is possible to measure attitudes towards ads using quantitative research
techniques such as attitude rating scales. The most commonly used types of attitude
rating scale are the “semantic differential”. Under this method, respondents are asked to
indicate on a seven point scale, their liking for an ad, on various dimensions.
12. Trailer test: In a trailer in a shopping center, shoppers are shown the products and given
an opportunity to select a series of brands. They then view commercials and are given
coupons to be used in the shopping center. Redemption rates indicate commercials
influence on purchase behaviour.
13. In-home tests: A video is taken or download into the home of target consumers, who
then view the commercials.
14. Telecast test: In this method, test-ads are shown in actual TV programmes in certain test
markets. Later, viewers are interviewed to know the reaction of viewers in the test
markets, the ad is modified before launching it in the total market area.

MECHANICAL LABORATORY TESTS

These are commonly used in US and other developed countries. These include:

1. The “tachisto-scope”: It is used to measure consumer perceptions to ads. Using this

device, the researcher can tell how long it takes for respondents to get the intended
message and how they perceive it. These way two alternative layouts may be tested for
their effectiveness.
2. The “eye camera”: It takes photographs the movement of people’s eyes while reading
ads. Eye movement camera test- This test is adopted for testing outdoor advertising. In
the test market area, eye movement cameras are installed at the place where neon
signboards are fixed. These cameras record the eye movements of persons watching these
signboards. The area of interest and attention can be judged by observing the eye
movements.
3. The “psychogalvanometer”: It is a device similar to lie-detector. It records skin
temperatures and tension resulting from reading ads. The theory behind this concept is
that the more tension an ad creates, the more successful it is likely to be.
4. The “Pupillo-meter”: It is a device that measures a person’s pupil size when exposed to
visual stimuli such as ads. The theory behind it is that the size of the pupil increases when
theperson finds the ad visually interesting or emotionally appalling.

PROJECTIVE TECHNIQUES

It is a type of qualitative or“motivational” research adapted from clinical psychology. It

permits the respondents to direct questioning, projective techniques permits respondents to
indirectly project their views or feelings about the advertising situation. The following types of
projective techniques are used:

1. Depth interviews: Here, respondents are shown advertising material and promoted
todiscuss it freely. A trained interviewer, usually a psychologist, probes the respondent
about his underlying feelings and motivations.
2. “Word Association and Sentence Completion” Tests: These area little more
structured than the depth interview. Key words or sentences are used as stimuli, to which
the respondent replies by projecting histhoughts. These words and sentence are taken
from ads being tested. This way, the researcher can determine what they mean to the
consumers.
3. Thematic Apperception Tests: In this method, pictures of people in ambiguous
situations are shown to respondents. Respondents are asked to build a story around
these pictures, by projecting their opinions and feelings into the story. The problem
with using projective techniques to measure advertising effectiveness is the
expenses involved, including the cost of training interviewers to evoke useful responses
from respondents.

B. Quantitative Methods of Pre-Testing

1. Checklist Method: Checklist method is used to test the effectiveness of ad-copy. The
purpose of this method is to ensure that all elements of the ad-copy such as headline,
subhead, body-copy, illustration, slogan, logo etc are included with due importance in the
advertisement.
2. Consumer Jury Method: This method involves the exposure of alternative
advertisements to a sample of jury or prospects. Advertisements which are unpublished
are presented before the consumer jury either in personal interviews or group interviews
and their reactions are observed and responses are recorded and they have to make
judgement and are supposed to select best ad from various proposed ads.
3. Sales Area Test: In this test, 2 cities are selected, where in one city, advertisement is
launched and in other city, advertisement is not launched. If there is increase in sales in
city where ad is launched as compared to other city, then advertisement is considered
effective.The impact of the campaign is evaluated by actual sales in the selected markets.
The market with high sales is considered the best market for effective sales campaign. In
other markets suitable changes are made in the advertising campaign.
4. Questionnaire Method: It is a list of questions related to an experiment. The draft of an
advertisement along with some relevant questions is to be sent to a group of target
consumers or advertising experts. Their opinions are collected and analyzed to find out
whether the proposed advertisement is satisfactory or not.
5. Recall Test: Under this method, advertising copies are shown to a group of prospects.
After few minutes they are asked to recall and reproduce them or in this test selected
person is shown a magazine cover and he is asked if he has read it. If the answer is ‘yes’,
and he is able to recall more about ad, then the ad is treated as more effective.This
method is used to find out how far the advertisements are impressive.
6. Reaction Test: The potential effect of an advertisement is judged with the help of certain
instruments, which measure heartbeats, blood pressure, pupil dilution etc. Their reactions
reveal the psychological or nervous effects of advertising.
7. Readability Test: All the listeners of advertisements cannot read it equally. So
respondents are drawn from different socio economic and geographical backgrounds.
This method is used to find out the level of effectiveness when and advertisement is
read.

Concurrent Testing
This type of testing is done while the advertising campaign is running in the market. The ad-
effectiveness is evaluated simultaneously when ad-campaign is being executed. Concurrent
testing is evaluated throughout the whole advertisement execution process. Tests are
conducted while audience is exposed to different type of media. Following are the types of
concurrent testing methods:

1. Consumer Diaries: Diaries are provided to selected customers. They are also informed
to record the details of advertisements they watch, listen or read. The diaries are collected
periodically. The result obtained from such a survey reveals the effectiveness of
advertisement.
2. Co-incidental Telephonic Surveys: This method is also called as co-incidental
telephone method. Under this method, samples of customers are selected and calls are
made at the time of broadcast of the advertisement programme. The data obtained and
analyzed will give a picture about the effectiveness of an advertisement.
3. Electronic Devices: Now day’s electronic devices are widely used to measure the
effectiveness of an advertisement. They are mainly used in broadcast media. These are
auto meters, track electronic units etc.
4. Interview Test - Under this method, prospective consumers are selected and are
interviewed. Such a face-to-face interaction is generally possible at POP (Point-of-
Purchase). Their responses to different dimensions of advertising and visibility in the
retail store are noted down and analyzed later.
5. Passers-by-Count test: In this type of test, the number of viewers stopping to view a
signboard/billboard/poster is counted. The number of viewers who halt and observe the
advertisement, the more effective the print ad campaign.
6. Mechanical Tests: In this type of test, the readers or viewers of the ad are observed
while they are actually reading or viewing the ad with respect to their eye movement, etc.

Post Testing
Post-testing method Post- testing method- These methods evaluate the effectiveness of
advertisement after ad has actually been launch in the total market area. The objective of such
test is to determine that ad campaign is accomplishing the advertising objective or not. Post
testing is done to know- to what extent the advertising objectives are achieved. Following are the
types of post testing methods:
1. Recognition Test: Recognition test involves the ability of viewers to correctly identify
ad, brand, or message they previously exposed to. In this test, selected person are shown
the advertisement and asked if they had previously seen or read any part of it. If they
answer in affirmation, if is considered that the advertisement is effective.
2. Starch Test: The Starch test is applied only to print ads that have already run. The
interviewer shows each respondent a magazine or newspaper containing the ads being
tested. For each ad the interviewer asks the respondents to reply to ad related questions.
3. Bruzzone Test: The Bruzzone test is conducted through mail surveys. Questionnaires
containing frames and audio scripts from television commercials are sent to respondents
and respondents are asked whether they recognise the ad and brand.
4. Recall or Impact Test: The recall test is designed to measure the impression of readers
or viewers of the advertisement. If a reader has a favourable impression of the
advertisement, he will certainly retain something of the advertisement. The measures of
interest would be obtained by interviewing the readers or viewers or listeners, days after
the advertisement or commercial is appeared in the newspaper, or on T.V. Interviewer
asks the readers or viewers to answer some ad related questions, and in response to the
question asked, the reader reveals the accuracy and depth of his impression.
5. Association test: In this test, any clue, idea, slogan or phrase from the advertisement is
provided to the respondent and he is asked to associate it with the brand name. if he
correctly relates the given phrase then the advertisement is evaluated is effective.
6. Passers-by count test: In this method the number of persons who are observing the
signboard/poster is counted. The larger number of persons observing ad indicates more
ad-effectiveness.
7. Customer diary test: Some selected prospective customers are given diaries and they are
requested to note down the weakness or strength of ad, when they watch or gothrough
advertisement. These diaries are regularly checked

Socio-economic contribution

Socio-Economic Contribution of
Advertising

Social & Cultural Economic

Contribution Contribution

Passive role of women

Support to Ayurveda
Caretaker of Family
Value of Products
Public service
Effect on consumer
Healthy Outlook
demand and choices
Importance to Girl Child
Competition Effect on
Changing Role of Male
Prices Effect on
Support to Sports and
business cycle
cultural activities
Develop Family Ties

Social contribution
Social and Cultural Values: Culture refer to the moral fabric of the society, cultural values act
as the foundation of social structure and life and according to Larson, “Culture represents the
ideas, values, attitudes and symbols governing the behaviour of the members of the group.”
Society frame the social values hence social and cultural values goes hands in hands. Ad can be
used in order to upgrade our social and cultural backgrounds and values.
1. Passive role of Women: In some of the ads, advertisers have shown educated, career
oriented and intelligent women in the family that gives an equal status to women as it is
given to men in the Indian society. For e.g. Tata Scooty, Nirma, etc.
2. Support to Ayurveda and Herbals: Some ads give support to Herbals and Ayurvedic
medicines and products. This culture always upgrade our Indian culture, which give
stress on natural health or healthy life. For e.g. Miswak toothpaste, Dabur products,
Vicco turmeric etc. ad
3. Caretaker of Family: Some ads show that mother or father taking care of their family
members about their health, life and financial position which upgrade our cultural values.
For e.g.
4. Public service: Such ads are prepared for public awareness. Ads on Family Welfare,
Family Planning, Eye or Blood donation, Environmental protection, Illiteracy campaign,
No smoking, Avoid drugs etc; ads are published as per our culture and traditional values.
For e.g.Eye donation by Neeta Ambani, Tata Tea Ja-gore.
5. Healthy Outlook: Public service ad tries to create a healthy attitude towards life within
our cultural background some institutional advertisements are included. For e.g. no
pollution by Tata steel, save the Tiger by Aircel, Cancer awareness ad
6. New Attitude towards women: Some ads create new attitude towards women within the
framework of our culture. For e.g. Whirlpool refrigerator, Asian paints ad
7. Importance to Girl Child: Some ads are provided important to the girl child and give a
new outlook to own culture by supporting equally important to a male and female child.
For e.g. HDFC educational policy, Kanya-Dan insurance from LIC
8. Changing Role of Male: There are advertisements, which show male in a different role
like the caretaker of wife, son, daughter, sister etc and try to change his role as head of
the family to friend of the family. For e.g. Act II Popcorn ad, Pepsodent toothpaste ad.
9. Support to Sports and cultural activities: Some ads support to the sports and cultural
activities which upgrade our cultural values. For e.g. Bournvita, Boost, Horlicks ad
10. Develop Family Ties: These types of ads provided important to unity among their family
members and providing important to family bonding. For e.g. Cadbury, Ambuja Cement,
Maruti Suzuki ad

Economic contribution
The advertisers are facing stiff competition not only in domestic market but also internationally.
Increasing competition in the area of advertising, the role of advertising has become all the more
huge and important. In the year 2011, the Indian advertising industry recorded a growth of 8
percent, with a total advertising sector of $5.6 billion. Advertising as an economic institution
affects the economic need of the advertiser, the economic decisions of the consumers and the
entire economic system of the country. Therefore there is a need to evaluate the various
economic aspects of advertising. It includes
Value of product
Consumer demand and choices
Competition
Cost and Prices
Business Cycles
1. Value of Products: Advertisement helps the product to increase the value by creating
demand and thereby positive image in the market as advertised product is always best one
but there are some unadvertised products also present which are good enough. But
advertising helps increase value for the products by showing the positive image of the
product which in turn helps convincing customers to buy it. Advertising educates
consumers about the uses of the products hence increasing its value in minds of the
consumers. For e.g. mobile phones were first considered as necessity but nowadays the
cell phones come with number of features which makes them mode of convenience for
consumers.
2. Effect on consumer demand and choices: Heavily advertised products are creating
demand for the products but similarly it can create many choices to consumers. hence the
product has to be different with better quality, and more variety than others. For E.g.,
Kellogg’s cornflakes have variety of flavours with different ranges to offer for different
age groups and now also for people who want to lose weight thus giving consumers
different choices to select from.
3. Competition: If advertising creates consumer loyalty to a particular brand, then that
loyalty may serve as a barrier to entry to other firms. Some brands of household products,
such as laundry detergents, are so well established they may make it difficult for other
firms to enter the market. In general, there is a positive relationship between the degree of
concentration of market power and the fraction of total costs devoted to advertising.
4. Effect on Prices: Some advertised products do cost more than unadvertised products but
the vice versa is also true. But if there is more competition in the market for those
products, the prices have to come down, for e.g., canned juices from various brands.
Some products and services do not needed advertisements even their prices are high but
they are still the leaders in market as they have their brand name. e.g., Porsche cars,
Speciality doctors etc;
5. Effect on business cycle:Advertising no doubt helps in employing more number of
people. It increases the pay rolls of people working in this field. It helps collecting more
revenues for sellers which they use for betterment of product and services. But there are
some bad effects of advertisements on business cycle also. Sometimes, consumer may
find the foreign product better than going for the national brand. This will definitely
effect the production which may in turn affect the GDP of the country.

Criticisms of advertising
Negative influence of
Ethical and social issues in
advertising on Indian values
advertising
and culture
Deceptive Advertising Increase in violence and crime
Misleading Prices No social standard
Unhealthy Competition Exploitation of women
Labeling issues Give importance to sex and nudity
Surrogate Advertisements Encouraging buying costly products
Puffery Harmful product ad
Use of sex appeals Unhealthy competition
Bait advertising Surrogate ads
Advertising of harmful products Negative impact on children

Ethical and social issues in advertising

Quality or standard of ad can be hired of proper attention is given to ethical value
1. Deceptive Advertising- Nowadays, many of the times, advertisements use false
statements and misrepresentations about their products illegally in violation of customers’
right to know exactly what they are purchasing. For e.g. “sold more than 10 lakhs brands”
2. Misleading Prices- Companies often hide prices of products/ services advertised in order
to attract a larger customer base especially for the costly products. The prices they
advertise often do not disclose additional charges and the overall cost to the customer.
For e.g. advertisements provided by Airlines, Mobile telephony industry, Memberships
for clubs etc.
3. Unhealthy Competition- This also provides unfair advantages to the seller over its
competitors. It shows unhealthy competition as one advertiser shows that his brand is far
better than the competitor’s brand. For e.g. Pepsodent v/s Colgate, Surf excels v/s Ariel
4. Labeling issues-Labeling on products can also be misleading. They may, at times,
misrepresent the actual weight of the packets. The packaging of products may also use
exotic high sounding words such as “organic”, “eco-friendly”, “natural”, “mild” etc.
without a proper explanation of the terms and such terms may even be used for products
that have nothing to do with such concepts.
5. Surrogate Advertisements- Whenever the advertisements for certain products like
tobacco or liquor, which have an adverse effect on health and are restricted or banned, the
manufacturers tend to launch new products with similar brand names and try to reinforce
or sustain the banned products/ advertisements. For e.g. Bagpiper Soda, Officer’s Choice
Water etc.
6. Puffery: It means the use of harmless superlatives like best, finest, number one, etc. Even
law permits trade puffing or exaggeration therefore Unilever company used campaign
that its Pepsodent toothpaste was 102% better than the Colgate toothpaste.
7. Use of sex appeals: Sex appeal is used to gain consumer attention. It is used where it is
not even appropriate to the product or service being advertised. Women are shown as
decorative objects for advertisements for products and services where women are not
required.
8. Bait advertising: It means taking advantage of consumer psychology and depriving
consumers of a choice. For example, a consumer is lured into a retail outlet by an
advertisement for a low cost item and then is sold a higher priced version or to be
defective. Once the consumer enters the store, he or she is pressured to purchase another
more expensive item.
9. Advertising of harmful products: According to law in India advertisements for
cigarettes, liquor, paan masala, products that are harmful to the public continue to find a
place despite the ban imposed by the government in private channels, cable, and through
the use of surrogates. Examples include Mc Dowell's Soda, and Wills lifestyle stores
which are seen as surrogate advertising for Mc Dowell's Whiskey and Wills cigarettes
respectively.

Negative influence of advertising on Indian values and culture

1. Increase in violence and crime: Most of the ads related to the consumer goods and
support to the different values of enjoyment, which degrade our work culture. Many ads
are materialistic or show violence. For e.g.Airtel and Thumbs Up ad of Askhay Kumar,
Hathi Cement ad.
2. No social standard: Some ads are not according to the Social Standard or according to
the Social Culture instead, some ads have a double meaning. For e.g. Rotomax pen ad,
Popins ad, Axe Perfume, Torque shampoo ad.
3. Exploitation of women: Many ads are exploiting women by vulgarity or depict them in a
passive role as a maid servant of the family or like vamp. For e.g. Old Spice, Moov ad.
4. Give importance to sex and nudity: Many ads, now a day, give importance to sex and
nudity as it attracts attention, but it also encourages the young generation to do crimes or
move on the wrong path. For e.g.Wild Stone or Axe Perfume ad Bacardi ad.
5. Encouraging buying costly products: It encourages people to buy costly products by
through attractive ads. To purchase such costly product, the consumer takes a loan which
is not good for his financial conditions as he could not afford the product. For
e.g.Nakshatra Diamond ad, Kalyan Jeweller ad, Car ad.
6. Harmful product ad: A hazardous materials ad called a harmful product ad; which
included the ads of Cigarette, Guthkha and Alcohol etc. Such ads created a demand of
these products and encourage gambling habits which is socially dangerous. For e. g.
Kingfisher beer, Goa guthkha, and Bagpiper ad.
7. Unhealthy competition: It creates unhealthy competition among the advertisers and such
situation is not socially desirable as it provides low quality products to the consumers for
profit concern. For e. g. Peps v/s Coca Cola, Tide v/s Surf washing powder
8. Surrogate ads: There are certain products which are restricted for public advertisement
like Liquor, Tobacco, etc, but the advertisers are reminding the customers through
backdoor way means showing one product but reminding about other products. For e.g.
Bagpiper Soda, Manikchand Pan-masala, Officers choice water etc.
9. Negative impact on children: Many ads created a negative impact on children’s minds
and then they learn to disrespect of elders or they are behaving badly. For e.g. Parle- G,
Poppins and Thumbs up etc.

Professional courses in advertising

1. Indian Institute of Mass Communication: Location: New Delhi (1965)Admission
Through: IIMC Entrance Exam, Website:www.iimc.nic.inIndian Institute of Mass
Communication (IIMC) started offering Advertising and PR course in 1981.
Courses:Post-graduate diploma programmes in Advertising and Public Relations, Post
Graduate Certificate Programme in Advertising Management and Public Relations
(PGCPAMPR), Online and Certificate Programme in Digital Marketing, Post Graduate
Certificate Programme in Crafting Creative Communications (CCC)
2. Mudra Institute of Communications (MICA): Location: Ahmedabad, Gujarat (1991)
Website: www.mica-india.net,Admission Criteria: Graduate in any discipline with
minimum 50% marks in graduation .Courses: AICTE approved PGDM-C, equivalent to
an MBA with specialisations in Marketing Research, Digital Communication
Management, Brand Management, Media Management and Advertising Management
3. Xavier Institute of Communications: Location: Mumbai (1969) Admission Through:
XIC Online Entrance Test website: www.xaviercomm.orgCourses: Advertising and
Marketing Communications, Public Relations and Corporate Communication, Film,
Television and Digital Video Production, Film, Television and Digital Video Production
(All Diploma courses) Announcing, Broadcasting, Compering, Dubbing, E-Book
Narration & Journalism in Marathi (All Certificate courses) The total of 335 Sessions/ 67
Credits makes the student eligible for the diploma.
4. University of Mumbai: Location: Mumbai (1865), Website: www.mu.ac.in Courses:
Degree programme such as Masters Degree in Arts (Communication and Journalism),
Masters Degree in Arts (Public Relations) and Masters Degree in Arts (Electronic
Media), wherein advertising is taught as a full-fledged subject, MA Programme in
Entertainment, Media and Advertising, Certificate in Advertising, Sales Promotion and
Sales Management, One Year Part-Time Post Graduate Diploma in Advertising and
Media,
5. St Xavier’s College: Location: Kolkata (1860) Admission Criteria: Should have
passed 10+2, Website:www.sxccal.edu Courses:Affiliated to Calcutta University, St
Xavier’s College offers six months duration certificate course to candidates in advertising
discipline. Get more details about the advertising course offered at St Xavier’s College
here like Bachelors in Media Management, BA Advertising, BA Advertising and Brand
Management, Post Graduate Diploma in Advertising, Diploma in Public Relations and
Advertising, Diploma in Advertising and Marketing Communication
6. WLC College India Ltd: Location: New Delhi, Mumbai, Bengaluru
(1996)Website:http://www.wlci.in Courses: Diploma in Advertising and Graphic
Design, Higher Diploma in Advertising and Graphic Design, Advanced Diploma in
Advertising and Graphic Design/ Visual Communication, Professional Diploma in
Advertising and Graphic Design / Visual Communication, Executive Diploma in
Advertising and Graphic Design / Visual Communication, Short Term Programmes in
Advertising and Graphic Design / Visual Communication
7. Mass Communication Research Centre (MCRC), Jamia Millia Islamia: Location: New
Delhi Website: www.ajkmcrc.orgCourses: Email: [email protected]
Indian Institute of Mass Communication (IIMC): Location: New Delhi Website
:www.iimc.nic.inCourses:Post-graduate Diploma Course in Advertising & Public
Relations. E-mail:[email protected]
8. National Institutes of advertising: Location: New DelhiWebsite: www.niaindia.org
Courses: Two Year Post Graduate Diploma in Marketing Communications Management
(PGDMCM) -Full Time and Two Year Post Graduate Diploma in Advertising and
Communications. Email:[email protected]

Careers in the field of advertising

1. Producers: They are overseeing the production and delivery of an advertising agency’s
work. They project manage the process of turning creative ideas into tangible outputs
across a variety of media. Their ability to manage multiple projects at any one time they
ensure that work is delivered on time, to the required level of quality, and within budget.
2. The Account Director: He leads a client account (or set of accounts) within an
advertising agency, ensuring they are profitable and growing. They take responsibility for
the delivery of quality creative work that meets the client’s needs and addresses their
business problems.
3. The Account Executive: Account Executives are responsible for ensuring the smooth
running of client accounts. They need to develop effective working relationships with
client contacts, and assist with all the key functions that go into creating the agency's
advertising output. They will get involved with solving problems, drafting internal and
external communications, and documenting progress.
4. The Account Manager: They are responsible for ensuring that the agency is meeting the
client’s needs and working with all the key functions that go into creating the agency’s
advertising output. They are constantly solving problems, managing internal and external
communications, and driving projects to completion.
5. Content Marketers: They are creating and sharing media and publishing content in
order to engage new customers, as opposed to the traditional advertising method. The
role of the Content Marketer shifts to include all the new innovations happening online.
The internet is crowded with different attempts to catch a web user’s eye, and only the
most creative Content Marketers are successful.
6. Art Directors: They are responsible for the creation and development of advertising
ideas, with particular focus on their visual appearance. These ideas can exist in many
formats from posters and print advertisements, to TV commercials, Direct Marketing
leaflets, mobile applications and websites. The Art Director combines artistic sensibilities
and understanding with knowledge of design and production processes to create work
that engages those it is aimed at.
7. Advertising Photographers: Produce images that support a marketing idea in answer to
a photographic brief given to them by a client, a designer or an advertising agency. This
can involve any subject matter, but is often categorized into specialist areas: still life,
portraiture and landscape. Some work is carried out on location, but much is done in
studios, using studio flash lighting and a variety of props and accessories.
8. Copywriters: They are responsible for the creation and development of advertising
ideas, with particular focus on the written words (copy) within these. This copy can be
anything from headlines and body copy for print advertising, to TV commercial scripts,
direct marketing leaflets, mobile applications and websites. Their imagination and flair
for writing allows them to create persuasive, engaging copy.
9. Creative Directors: Creative Directors are aware of the commercial aspects of running
an agency and act as guardian to clients’ brands across all work being created. In smaller
companies, they sometimes steer the agency’s creative identity and can be responsible for
its creative reputation as a whole.
10. A Creative Technologist: He is someone who can bring both a creative input and a
technical knowledge to an agency. They are often directly involved in the creative
process, and quickly build working prototypes of what’s needed to show clients.
11. A Developer: A developer in the advertising industry will be a keen programmer
capable of designing applications and software to suit a client’s needs within a marketing
campaign. The role requires a strong focus on the technical side of development, along
with excellent communication skills.
12. An events manager: Some event managers will also host or present at their own events,
but this is not expected of people in this job role. An event manager is typically an all-
encompassing job, starting at researching venues, negotiating prices and organising
suppliers, all the way to running the schedule of the event on the day. The role may also
be referred to as “Event Planner” or “Event Organiser”.
13. Graphic Artists: They produce all the props that contain graphic (written) items, e.g.
money, newspapers, magazines, handwritten or typed letters, musical scores, books,
maps, shop signage, menus, credit cards, passports, etc. They work closely with the
Production Designer, Props Master, Standby Props, and Art Director(s).
14. A graphic designer: He is a person who designs a visual message for a product using
words and images for a client. From an outside perspective, it just looks like moving
things around in Photoshop, but a graphic designer’s job is so much more than that.
Motion Graphics Designers put together video that contains animations and visual
effects. The role has evolved from graphic designers, with new tools allowing designers
to move into video.
15. An Illustrator: He is an artist who creates images that match a design specification. In
the marketing world, illustrators are behind a lot of the billboard and magazine adverts
you see every day, turning artwork into marketing tools. Illustrators typically work
freelance however, and their skills can extend across the creative industries, from book
covers to business cards.
16. Junior Account Planners: They help to represent the voice of the consumer in the
agency. They’re part of the team responsible for developing the key strategic insights that
underpin advertising ideas. They work closely with the client to research the market and
understand the consumer. In answer to their client’s business brief they help formulate a
brand communications strategy, followed by the creative brief that will be used by the
agency’s creative teams to produce the creative ideas.
17. The Media Account Director:He leads client accounts within the agency, ensuring that
they are profitable, and growing. They take responsibility for the delivery of media
planning and buying that meets the client’s needs and addresses their business problems.
They will regularly be involved with pitches for new business, approaching these with
both a strategic and commercial mind-set.
18. Media buyers: They negotiate and purchase media space and airtime on behalf of
clients. Media buyers may specialise in a particular channel, such as Press, TV, Radio or
digital, or work across a variety of channels. In larger agencies, media buying and
planning are separate departments, but in some agencies the planning and buying
functions are combined in one role.
19. Media Planner: He develops strategies that determine which media channels should be
used to communicate with a client’s target audience. These strategies come from the
brand’s communications strategy and often need to be developed in conjunction with the
client’s creative agency.
20. Web Designers: They bring creative ideas to life across a variety of digital formats.
Working with creative teams, user experience designers, and web developers they ensure
a strong visual end product to engage audiences and meet the client’s needs. They may
also be called upon to work on agency new business pitches, designing materials to
promote the agency and its work to potential new clients.
21. Researchers:They use data collected from premium resources, as well as their own
knowledge, to put together cross-sector information and analysis on anything from
markets and brands to trends, developments, and recent innovations. Research teams need
to be very flexible, responding quickly to requests with useful actionable insight across a
wide range of topics. The ultimate purpose is to help the agency team deliver work that is
relevant and cuts new ground for their client’s business.
22. Junior Web Analytics Consultants:They measure, collect and analyse internet and
application data to inform and enhance online marketing strategies. This involves the
manipulation of large data sets created by patterns of behaviour among internet users to
develop insights into how and why people do what they do online. Working closely with
other members of the online team, this can improve the performance of specific websites
and applications, identify problems and support the sales and marketing efforts of clients.
23. Animator: An animator produces multiple images called frames, which when sequenced
together create an illusion of movement known as animation. Animators tend to work in
2D animation, 3D model-making animation, stop frame or computer-generated
animation.The basic skill of animation still relies heavily on artistic ability, but there is an
increasing need for animators to be familiar with technical computer packages.
24. Modelling: Modelling is distinguished from other types of public performance, such as
an acting, dancing or mime artist, although the boundary is not well defined. Appearing
in a movie or a play is not considered modelling. However, models may be considered to
express emotion in their photographs or video.Types of modelling include fashion,
glamour, fitness, bikini, fine art, and body-part models. The first person described as a
fashion model is a Parisian shop-girl, Marie Vernet Worth. She was a house model in
1852, to her fashion designer husband, Charles Frederick Worth.
25. Dubbing: Dubbing is the post-production process of recording and replacing voices for a
motion picture or television soundtrack subsequent to the original shooting schedule.
Dubbing has two meanings in the process of television or movie production. It is used to
describe the replacement of one soundtrack by another like music, sound effects,
dialogue, natural sound, etc. Dubbing is also a "language transfer," i.e. translation of
audio-visual works. In brief dubbing means the replacement of the dialogue of any
language with the viewer’s languages.

Regulatory framework of advertising: Legal Framework of Advertising

There is various laws’ enactment concerning advertising in India. Ethical values don't give much
attention from media, advertisers and ad agency as a result unethical ads are growing. It is not fair to
allow the growth of such unethical acts in India as well as in any country. Regulation of such ad is a
must. There are two methods for regulating unethical ads

a) State Regulatory Law

b) Self-Regulation Law
a) State Regulatory Law: It is also called External Regulation Law. The Government
regarded on unethical ads using their existing Acts such as:
 Essential Commodities Act, 1955
 Standard of Weights and Measures Act 1977
 Food Adulteration Act 1962
 MRTP act 1969 (Change into competition Act 2002)
 Wild Life Welfare Act 1971
 Consumer Protection Act 1986

In India some ads are restricted to different media by the government or NGOs and such ads are related
to products like liquor, tobacco etc.

b) Self-Regulation Law: This regulation should be made and applicable to all parties
connected with advertising such as Advertisers, Ad Agencies, Publications, Electronic
media, etc. the professional agency prepared a code of ethical conduct and make it
applicable to all members on a voluntary basis.
Agencies involved in self-regulation: Advertising Trade Associations, Advertising
Standards Council of India (ASCI), Advertising Association of India (AAAI), Press
Council of India, Prasarbharti, Individual media and media groups, Code for commercial
advertising on Door-Darshan, All India Radio Code for commercial advertising
Important Laws related to Misleading Advertisements can be divided into two categories.
A. Laws having horizontal application on advertising
 The Consumer Protection Act, 1986 The Emblems and Names (Prevention of Improper Use) Act, 1950
 Trade and Merchandise Marks Act, 1958.  Cable Television Networks (Regulation) Act, 1995 
Indecent Representation of Women (Prohibition) Act, 1986  Monopolies and Restrictive Trade Practices
Act, 1969
B. Laws having a vertical application on advertising
 Drugs and Cosmetics Act, 1940  Drugs and Magic Remedies (Objectionable Advertisements) Act,
1954  Pre-natal Diagnostic Techniques (Regulation and Prevention of Misuse) Act, 1994  Prevention of
Food Adulteration Act, 1954/ Food Safety and Standards Act, 2005  Prize Chits and Money Circulation
Schemes (Banning) Act, 1978  Prize Competition Act, 1955  The Infant Milk Substitute, Feeding
Bottles and Infant Foods (Regulation of Production, Supply and Distribution) Act, 1992 and Amendment
Act, 2002  Transplantation of Human Organs Act, 1994  The Young Persons (Harmful Publications)
Act, 1956 .

The following Regulatory authorities have power to regulate advertising in their respective domain. 
Insurance Regulatory Development Authority  Telecom Regulatory Authority of India  Securities and
Exchange Board of India  Reserve Bank of India  Medical Council of India

There are several laws in India that relate to advertising. A snapshot of some of these enactments is
provided hereunder-

1. Consumer Protection Act, 1986- Section 6 of the Act grants consumers the right to be
informed about the quality, quantity, potency, purity, standard and price of goods or
services, as the case may be so as to protect the consumer against unfair trade practices.
2. Cigarettes and other Tobacco Products Act, 2003- Section 5 of this Act, inter alia,
prohibits both direct & indirect advertisement of tobacco products in all forms of audio,
visual and print media;
3. Cable Television Networks (Regulations) Act, 1995- Section 6 of the Cable Television
Networks (Regulations) Act, 1995 provides that no person shall transmit or re-transmit
through a cable service any advertisement unless such advertisement is in conformity
with the advertisement code prescribed under the Cable Television Networks
(Amendment) Rules, 2006.
4. Door-darshan/ All India Radio (AIR) Advertisement Code- Door-darshan and AIR,
both under the control of Prasar Bharati, follow a comprehensive code for commercial
advertisements, which control the content and nature of advertisements that can be
relayed over the agencies;
5. Drug and Magic Remedies Act, 1954- This Act purports to regulate the advertisements
of drugs in certain cases and to prohibit the advertising for certain purposes of remedies
alleged to possess magic qualities and to provide for matters connected therewith;
6. Drugs and Cosmetics Act, 1940- Section 29 of the Act imposes penalty upon whoever
uses any report of a test or analysis made by the Central Drugs Laboratory or by a
Government Analyst, or any extract from such report, for the purpose of advertising any
drug.
7. Emblems and Names Act, 1950- This piece of legislation prohibits the use of any trade
mark or design, any name or emblem specified in the Schedule of the Act or any
colourable imitation thereof for the purpose of any trade, business, calling or profession
without the previous permission of the Central Government;
8. Food Safety and Standards Act, 2006- Section 53 of this Act provides a penalty of up
to Rs. 10 lakhs for false and misleading advertisements relating to the description, nature,
substance or quality of any food;
9. Indecent Representation of Women Act, 1986- This Act is aimed at prohibiting
indecent representation of women through advertisements or in publications, writings,
paintings, figures or in any other manner and for matters connected therewith or
incidental thereto.
10. Prenatal Diagnostic Techniques Act, 1994- Advertisement in any manner regarding
facilities of pre-natal determination of sex available at any genetic counselling centre,
laboratory, clinic or any other place is prohibited under this Act and has been made a
punishable offence under the Act (Section 22);
11. Young Persons Act, 1956- Section 3 of the Act, imposes penalty for advertising or
making known by any means whatsoever that any harmful publication can be procured
from or through any person;
12. The Representation of People Act, 1951- Section 126 of the act, the display to the
public of any election matter by means of the cinematograph, television or other similar
apparatus in any polling area during the period of forty-eight hours ending with the time
fixed for the conclusion of the poll for any election in the polling area is prohibited under
the Act.
13. Indian Penal Code, 1806- The IPC, vide an array of provisions, prohibits obscene,
defamatory publication, publication of a lottery and/ or statements creating or promoting
disharmony/ enmity in society
Role of Information and Broadcasting Ministry (IBM or MIB)
The Ministry of Information and Broadcasting is a branch of the Government of India which is
apex body for formulation and administration of the rules and regulations and laws relating to
information, broadcasting, the press and films in India and established on 12th September, 1990.
SmritiIrani is a Cabinet minister and Rajyavardhan Singh Rathore is a Minister of state.

Broadcasting Policy And

Press Administration
Publications Films Cable Television Policy
Research & Reference Radio
Doordarshan
Miscellaneous
Role of Information and BroadcastingMinistry

A. Information Wing:
It includes Advertising and Visual PublicityProduction and release of advertisements on behalf
of the Government of India.
1. Press: *Presentation and interpretation of the policies and activities of the
Government of India through the medium of the press. * Advising Government on
information problems relating to the Press, keeping Government informed of the main
trends of public opinion as reflected in the Press and liaison between Government and
the Press. * Publicity to and for the Armed Forces. * General conduct of Government
relations with the Press excluding the administration of sections 95 and 96 of the
Code of Criminal Procedure, 1973 (2 of 1974). * Administration of the Press and
Registration of Books Act, 1867 (25 of 1867) relating to Newspapers. *
Administration of the Press Council Act, 1978 (37 of 1978). * Allocation of
Newsprint to Newspapers.
2. Publications: Production, sale and distribution of popular pamphlets, books and
journals on matters of national importance for internal as well as external publicity,
with a view to imparting to the general public at home and abroad up-to date and
correct information about India.
3. Research and Reference:To assist the Media Units of the Ministry of Information
and Broadcasting in collection, compilation and preparation of material involving
research into published works, etc.
B. Films Wing:
4. Films:Legislation under entry 60 of the Union List, viz., ‘Sanctioning of
Cinematograph films for exhibition’. * Administration of the Cinematograph Act,
1952 (37 of 1952). * Import of feature and short films for theatrical and non-theatrical
viewing. * Export of Indian films, both feature and short films. * Import of
unexposed cinematograph films and various types of equipment required by the film
industry. * All matters relating to film industry, including developmental and
promotional activities thereto. * Promotion of good cinema by institution of State
awards for films produced in India and assistance through the National Film
Development Corporation Limited. * Production and distribution of documentaries
and newsreels and other films and film strips for internal and external publicity. *
Preservation of films and filmic materials. * Organisation of International Film
Festivals in India and participation of India in International Film Festivals abroad. *
Organisation of Film Festivals under Cultural Exchange Programmes.
C. Broadcasting Wing:
5. Broadcasting Policy And Administration:* All matters relating to radio and
television broadcasting within the Union including regulation of the use of All India
Radio and Door-darshan by recognized national and regional political parties during
elections to the LokSabha and State Assemblies and procedure to be followed by the
official electronic media during periods of national mourning on the demise of a high
dignitary. * The enunciation and implementation of the law relating to radio and
television broadcasting in India by private Indian companies or Indian nationals. *
Broadcast Monitoring and Administration of the Prasar Bharati (Broadcasting
Corporation of India) Act, 1990 (25 of 1990).
6. Cable Television Policy: * Cable Television Networks (Regulation) Act, 1995 (7 of
1995).
7. Radio:* All business connected with All India Radio embracing news services in the
home programmes, programmes for the foreign countries and Indians overseas, radio
journals, research in the field of broadcasting engineering, monitoring of foreign
broadcasts, programme exchange and transcription services, supply of community
receiving sets to State Governments under the community listening scheme, etc. *
Development of radio broadcasting throughout the Union, installation and
maintenance of Radio Stations and Transmitters and operation of broadcasting
services.
8. Doordarshan: * Exchange including cultural exchange of television programmes. *
Development of television throughout the Union, including installation, maintenance
and operation of television Programme Production Centres and Transmitters, and
operation of television services. * Promotion of production of television programmes
outside Doordarshan.
9. Miscellaneous: * Publicity for the policies and programmes of Government of India.
* Administration of Journalists Welfare Fund. * Financial assistance to distinguished
musicians, both vocal and instrumental, dancers and dramatists who have contributed
substantially to the success of All India Radio and other units of the Ministry or their
survivors in indigent circumstances. * All matters relating to the Asia-Pacific
Broadcasting Union, Commonwealth Broadcasting Association and the Non-Aligned
News Agency Pool. * Cadre management of the Indian Information Service (Groups
‘A’ & ‘B’)
Self-Regulatory bodies

ASCI (Advertising Standard Council of India)

It has following features:
 The Advertising Standards Council of India,
 ASCI founded in 1985.
 It is set by 48 founder members who are involved in advertising activities.
 It has a self-regulatory organization (SRO) and Non-profit organization for advertising
control.
 This independent NGO, ASCI was formed with the support of all four sectors connected
with Advertising -- Advertisers, Advertising Agencies, Media (including Broadcasters
and the Press)
 And others like PR Agencies and Market Research Companies.
 The main objectives of the Code are:
To codify adopt and from time to time modify the code of advertising practices in India
and implement, administer, promote and publicize such a code.
To encourage, maintain and uphold fair, sound, ethical and healthy principles and
practices of advertising.
To promote better understanding of the benefits of fair, sound and ethical advertising
amongst the practitioners of advertising and in society at large.
To represent, protect, inform and guide members of the company on matters relating to
advertising.
To foster and promote cooperation amongst persons or companies, which are engaged
and involved in advertising.
 Other objectives are:
a) To mandate for all advertising material like it must be truthful, legal and honest,
decent and
b) It should not objectify women,
c) It should be safe for consumers - especially children.
d) Fair to their competitors.
e) To safeguard against indiscriminate use of advertising
f) To safeguard against misleading ad
g) The Consumer Complaints Council (CCC) is ASCI’s heart and soul.

ASCI’s goals include monitoring, administering and promoting standards of advertising practices
in India with a view to:
 Truthfulness and honesty: It ensures truthfulness and honesty of representations and claims
made through advertising and safeguarding against misleading advertising.
 Should not offensive: It ensures that advertising is not offensive to generally accepted
norms and standards of public decency.
 Against indiscriminate use: It safeguards against indiscriminate use of advertising
for promotion of products or services which are generally regarded as hazardous to society or
to individuals or which are unacceptable to society as a whole.
 Fairness in competition: It ensures that advertisements observe fairness in competition and
the canons of generally accepted competitive behaviour.
 Example: In September 2012, Consumer Complaints Council (CCC) of the Advertising
Standards Council of India (ASCI) upheld complaints made against 15 out of 22
advertisements. During the same period, it did not uphold complaints against 7 ads. The
effective functioning of ASCI’s National Advertising Monitoring Service (NAMS) continues
to help track down misleading advertisements that were otherwise missed as consumers did
not lodge complaints to ASCI against them. (Source: www.bestmediainfo.com/2012/12/asci-
pulls-up-15-misleading-ads-in-september-2012/)

Indian Broadcasting Foundation (IBF)

Indian Broadcasting Foundation also known as (IBF) is a unified representative body of
the Television Broadcasters in India. Over 250 Indian Television channels are associated with it.
The organisation is credited as the spokesman of India Broadcasting Industry
1. Establishment: The Indian Broadcasting Foundation was a Non-profit organisation,
established in 1999 to primarily fulfill this simple need. IBF’s members comprise both
News and Non-News Channels including GEC, Sports, Music, Movies, Infotainment, etc.
2. Objective: The main objective of this Committee is to recover outstanding dues from
media agencies, alsoanother objective of the IBF is examine content-related complaints
relating to all non-news general entertainment channels in India through Broadcasting
Content Complaints Council,(BCCC) which it had set up in the year 2011 and one of the
subsidiaries of IBF.
3. Membership: IBF membership base has expanded owing to clearances of several
pending licenses/security clearances/renewals of member channels. The tally of National
Channels has increased to 178 and their numbers have gone past that of Regional
Channels in 2016. The membership base of IBF has grown to 60 with the number of
channels to 376 including this year’s new members like Zee Aakash News, Insight Media
City, Living Media and Republic TV.
4. IBF Committee on Credit and Collections Back: Advertisements are the primary
source of revenue for television channels. The IBF committee meets every month to
review the outstanding dues, calls the defaulting clients and media agencies for meetings
and takes appropriate action. Consistently defaulting clients are put on Advance/PDCs.
5. Shifting procedure and Dispute handling:In case of shifting of client from one agency
to another, the Committee ensures that laid down procedure is followed by media
agencies and clients. The Committee also resolves any dispute arising between
broadcasters and advertisers/media agencies. This Committee not only engages the
AAAI member agencies but also deals with agencies which are not members of AAAI,
DAVP, NFDC and DIPRs.
6. IBF Committee on Distribution Back: This Committee has been formed to deal with
issues related to distribution of television channels like digitalization of cable industry,
piracy and under-declaration and take up other issues like price cap and regulation on
interconnection with TRAI and Ministry of Information & Broadcasting.
7. Public Policy & Regulations Back: The Broadcasting Sector bursts the arrival of the
new tax regime as it looks forward to benefits of GST accumulating to it. Broadcasters
had been keenly awaiting the start of this major policy shift which would not only serve
the call of ‘One Nation One Tax’ but also ensure necessary transparency in the country’s
financial milieu.
8. GST transition:Last year has been eventful for the Credit & Collections Committee of
IBF with GST taking centre stage. For a successful transition to GST, it was important to
ensure that minimum disruption was caused to businesses. IBF played a pivotal role in
generating agreement amongst IBF, AAAI and ISA on GST matters to simplify and
billing during GST transition.
9. Reconciliation policy:Frequent reconciliation policy adopted by the IBF-AAAI Sub
Committee has kept the outstanding beyond 60 days in check which is evident from the
fact that the old outstanding accounts for only 3% of the total outstanding.Payments from
AAAI Agencies have remained largely streamlined with zero defaults.
10. Legislative inputs:IBF provides research-based legislative inputs to the Government and
carries out advocacy on various fiscal, regulatory and other business issues to facilitate
drafting of favorable policies, resolution of issues and introduction of necessary changes
in the overall system.
11. Various features
 IBF members manage 350+ channels and about 90% of television viewership across
country
 IBF members are admired globally for their innovative business practices, social sector
participation and thrust on playing a key role in the global civil society.
 IBF members represent around 95% of the industry revenues generating employment for
millions.
 IBF acts on behalf of its members to ensure credit is aptly and professionally managed
between advertisers, agencies and broadcasters.
 IBF engage with members and strategize through various Committee meetings and
Forums.
*****
3 Sales Management

 Introduction: Sales Management - Features, Functions and Importance, Art of

Selling – Types, Process, Qualities of an Effective Salesman.
 Sales force management : Selection Procedure, Training Methods, Motivational
Factors and Compensation methods of sales personnel
 Sales organisation : Concept, Objectives, Structure and Steps in Developing a
Sales Organisation

Introduction to Sales Management:

Sales management is an area of business, which is concerned with the actual application
of sales techniques and involves themanagement of firm's sales operations Efforts are planned so as to
achieve the goals of sales management. Sales manager is the typical title of someone whose responsibility
is sales management.Sales management also refers to the process of developing a sales force,
coordinating the sales operations and implementation of various sales techniques that allows business to
achieve its sales targets.
According to American Marketing Association: Sales management means “the planning, direction, and
control of personal selling, including recruiting, selecting, equipping, assigning, routing, supervising,
paying and motivating as these tasks apply to the personal salesforce”
According to Douglas J. Dalryample and Willaim L. Cron: “Sales Management is the planning,
implementing and control of personal contact programs designed to achieve the sales and profit objectives
of the firm”
Features: Following are the key features of Sales Management:
1. Understanding and monitoring sales:Sales management basically includes planning and
implementing sales programs within an organization, as well as managing sales teams. A sales
manager's primary responsibility is to administer successful marketing plans that effectively
contribute to achieving organizational goals. Sales management includes planning understanding
the importance of sales and monitoring and explaining market trends to sales personnel
2. Creating sales structure:Sales Management involves creating sales team structure which
includes sales managers, assistant sales managers, team leaders and other sales personnel. It
involves making sales employees understand their responsibilities and the expected performance
and how to achieve assigned duties.
3. Creating sales strategy:Sales Management involves creating, developing and implementing
sales strategies. It involves identifying and assigning sales territories, planning product
promotions, planning and designing sales campaigns and other sales techniques by the Sales
managers. It also requires sales managers to set standards for customer services and loyalty.
4. Recruiting sales personnel: Sales Management involves hiring effective and top salespeople
regularly so as to achieve its objectives smoothly. Various techniques are used so as to test sales
skills, including conducting quality interviews and to identifypotentially successful salespeople
5. Training sales personnel:Sales Management key characteristics is not just to hire sales team, but
also to effectively train them on sales techniques, building product value, opening the sales talk,
relations with the customers, time management and closing deals etc. It is a necessary feature of
sales management team as it is only through effective and well trained sales staff/personnel; the
sales and profits targets can be achieved.
6. Motivating sales personnel:One of the key feature of sales management is to identify various
factors affecting motivation of sales team members and then to design interpersonal
communication and motivational tools for the sales personnel. It involves designing rewards,
appreciation, incentives, perks, benefits, prizes for outstanding sales performances for the
personnel.
7. Monitoring sales personnel:It is one of the key features of the sales management to monitor
sales personnel’s performance on a regular basis so as to point out deficiencies in the process. It
also helps to keep a track of the ongoing sales efforts of the sales personnel. Monitoring the
performances/achievementshelps to define next targets in a much better way.
8. Relates to personal selling: Modern Sales Managers are in charge of personal selling activity
and their primary assignment is management of sales force. Hence the term sales management is
relates with personal selling.
9. Functioning as per business operations: The meaning of the term sales management has been
changing with the changes in business operations. Earlier, businessmen were of the opinion that
the term sales management referred solely to the direction of the sales force personnel. However,
at present, the term includes all such marketing activities such as advertising, sales promotion,
marketing research, distribution, pricing and product merchandising.

Functions of Sales Management:

The functions of the sales management differ from company to company depending on the size of the
company and the nature of the product and many other factors. In a nutshell, the main functions of Sales
Management can be described as under:
1. Designing a sales strategy:The organisational and marketing objectives and planning are
rendered useless without an effective sales strategy. Every business has a sales cycle which is a
series of tasks that helps a company’s product reach its users and therefore, having a sales pipeline
can facilitate the effective completion of sales targets.A sales pipeline refers to a visual sequence
of activities to be achieved with each prospect from the initial lead to the closing of the deal. Thus,
sales managers must design an effective sales strategy in co-ordination with the strategies of other
functional departments.
2. Formulating Sales Policies: PRODUCT : Deciding the product line Whether product
design or quality need to be modified Models, types/ size/ colour/ packing to be sold how
product service is to be provided Kind of product guarantee are to be given
DISTRIBUTION: Channel design and types Channel remuneration, motivation & training
Channel-principal relations Channel Costs, PRICING : Whether prices should match
competition or be below / above competition Pricing method for each class of customer /
order discounts and rebates Terms of delivery and terms of payment
3. Effective Implementation of sales operations:The sales team is the backbone of the company
and is the direct link between the product and the customer. Therefore, it is necessary that the sales
team feels like they are a part of the company. It is vital to understand that the sales personnel
shouldn’t just become great sellers but need to be great at selling the company’s product and
should act as a representative of the organization that customers want to work with.Also, the sales
team should be working as individuals within a single, collaborative unit. Apart from this, the sales
manager to ensure effective implementation of sales targets, should set realistic targets, assign
specific territories as well as establish clear goals and individual quotas.
4. Undertaking sales analysis: Sales analysis and reportingenables an organisation to understand
how the current efforts affect the company’s success and gives an insight into what can be done to
increase sales efforts.Successful reporting involves the use of sales metrics or quantifiable
indicators that show how each aspect of the sales operations is performing and whether the targets
are being achieved or not. Accordingly, sales managers can undertake corrective action if required.
5. Creation of demand: Sales Personnel are directed towards efforts that lead to creation of demand
for the product in the market amongst the consumers. As if demand is created, it helps the sales
personnel to achieve greater sales and thereby achieving greater profits for the company.
6. Sales Cost and Budget: Sales management key function is also to work out the total cost that will
be involved for the selling and distribution of the product in the market. It helps to working out the
estimated budget that would be spent for the selling and distribution. It helps the firms to allocate
the resources appropriately while planning the sales expenditure.
7. Planning & Staffing: The conscious, systemic process of making decisions about goals and
activities that an individual, group, work unit, or organization will pursue in the future and the use
of resources needed to attain them.Activities undertaken to attract, develop, and maintain effective
sales personnel within an organization is a staffing in sales management.
8. Sales Training & Leading: The effort put forth by an employer to provide the salesperson job-
related culture, skills, knowledge, and attitudes that result in improved performance in the selling
environment. The ability to influence other people toward the attainment of objectives is a leading
which is important in the sales management
9. Controlling & Sales Performance: in controlling the sales force manger is monitoring sales
personnel’s activities, determining whether the organization is on target toward its goals, and
making corrections as necessary.Sales Management is the attainment of sales goals in an ethical,
efficient, and effective manner.

Importance:
The following are the key points that explain the importance of Sales Management:
1. Sales maximization: In the process of sales management, the top management fixes the sales
volume more specifically on the basis of market, territory, and customer or on any other relevant
basis. Proper planning and implementation on the part of sales managers and appropriate motivation
to the sales personnel in turn help to achieve the objective of sales maximization to the organisation.
2. Profit maximization: Profit maximization is the general objective of sales management of an
organisation. The top management is accountable for ensuring maximum profitability of the firm.
With the help of proper sales management, the objective of profit maximization can be successfully
achieved.
3. Growth and development: Effective sales management helps to get higher sales, profits and market
share and improves the overall performance of the organisation. This enables the management to
take up the opportunities of growth, expansion, diversification, etc. and expand its business activities
to a wider scale.
4. Better planning: A plan acts as a blueprint for future action and the success of an action mainly
depends on effective planning. The sales management formulates concrete, useful and effective plans
including objectives, forecasting, budgeting strategy, programming and controlling which helps to
undertake sales activities effectively and efficiently.
5. Advice to top management: Sales management helps to provide suggestions and recommendations
to the top management regarding opening and closing of branches. Opening of new branches may
involve the detailed study and sanction for branch location, layout, staff pattern and so on. The sales
managers may advice the top management with respect to the same.
6. Facilitates salesforcemanagement:Salesmanagement also plays a vital role in sale force
management. Salesforce managementenables to select, train, motivate and manage the sales
personnel to effectively achieve the sales objectives on time.
7. Optimum use of resources:Sales management facilitates proper sales planning and control. It
enables to organise the right amount of resources and adequate amount of inventory which in turn
enables the optimum use of physical, capital and human resources. Therefore, sales management
minimises wastages and leads to optimum use of resources.
8. Improves product design and development:Efficient and effective sales management can also help
to introduce modifications in the existing products or develop new designs for new products in order
to meet the changing tastes and preferences of the consumers. Thus, sales management according to
the needs and wants of customers introduces improvement in the design and development of its
product or service.
9. Optimizes Distribution:Salesmanagement helps to evaluate an organisation’s distribution methods
and maximizes their use. Also, it facilitates the selection of right channels to distribution so that the
products reach the consumers on time. Thus, sales management helps to optimize the distribution of
an organisation.

Art of Selling
It is well known that selling is an art that takes practice to improve. Selling something is truly an art and it
is a fundamental truth that “Great Salespeople, like great athletes, simply do their basics very well”
It is said that Selling is an art as well as science. The Science is an ability to diagnose a problem and find
a best scientific solution. The art is an ability to create the relationship and the solution for the problem.
Selling is an art as it is the ability to create relationship with the customer and getting sales.
It can be defined as the act of persuading someone to accept/buy your offering/product. In simple words it
can be said that art of selling is nothing but a process where a salesman and the customer walk the road of
agreement together

Types
1. Aggressive Selling: This is one of the selling styles in which the sales representative is highly
focused on the intention to sell. The main focus is to sell the product by highlighting the special
features and giving all the possible product information to the customer. The most peculiar aspect
of aggressive selling is that the sales representatives work the better as an individual rather than
being a part of the team.
2. Consultative Selling: Consultative selling is also referred to as relationship building selling style.
This style is widely regarded as one of the most successful ones as the sales representative is
willing to adjust to any kind of selling situation and cater to any prospective client. As a result,
the sales personnel manage to get the best possible outcome. Also, this style focuses on
establishment and maintenance of long term relationship with its clients.
3. Need-oriented Selling: The need oriented selling style is a type of selling style in which the sales
representative needs to think quickly and accordingly adapt. The sales representativemust be
highly tactful and should be able to ask such questions that enable him to understand the
customer’s needs. Based upon the need or want of the customer, the sales representative should
accordingly introduce the product or service.
4. Product-oriented Selling: In this type of selling style, the sales representativehas a greater
inclination towards explaining the features and benefits of the product to the prospective
customer. The product oriented selling style includes a lot of product demonstration until the
prospect is fully convinced about the product benefits. The sales person should have complete
knowledge of the product so as to convince the client about its benefits.
5. Competition-oriented Selling: In the competition-oriented selling style, the salesperson is very
persistent in trying to persuade a potential customer. The sales representative will do every
possible thing to close a deal resulting in direct and interpersonal influence. With a competition
oriented mindset, the sales representatives nowadays are willing to go an extra mile to get the job
done. In this style, the sales representatives will work their way out even if the situation is tough
and convince the prospective client to get the sale done.
6. Collaborative Selling:In a collaborative selling style, there is a partnership mentality between
customer and seller. In this type of selling style, the buyer may be able to partner on matters that
would typically be the sole responsibility of the seller. Theremay be some opportunities where the
buyer can be flexible in order to help the seller survive such as some flexibility in payment terms,
inventory levels and other items that help the overall bottom line of the seller without
significantly impacting the business of the buyer. This style is mostly applicable in a typical B2B
business.
7. Transactional Selling: This technique is all about short term sales. The salesperson is primarily
concerned with the selling of the product with little or no emphasis on customer needs. It is oldest
form of selling where salesperson hopes that the customer by listening to his sales talk order the
product and deal will be done.

Selling – Process

Step 1: Prospecting and Qualifying: Prior to sales planning, a salesperson first conducts research which
enables him to identify the people or companies that might be interested in their product offering. This
step is called as prospecting which is the foundational step for the rest of the sales process. A prospect in
other words is a lead that is qualified or determined to be ready, willing and able to buy. Thus,
prospectinghelps to identify customers who are in the process of need identification or have already
identified one. After prospecting, the salespersonqualify his prospects so as to focus the sales efforts only
on those people who are most likely to buy.
Step 2: Pre-approach: The next step is pre-approach which involves good research on the part of the
sales representative with respect tothe prospective customer, familiarizationwith the customer’s needs and
learning all the relevant background informationabout the individual or business.
Step 3: Approach: Before getting into the details of the product, the sales representative generally tries
to establish a rapport with the customer first which involves introductions, making some small talk,
asking a few warm-up questions and generally explaining a little about the organisation that the
salesperson represents.This step is called as the approach and it may be on the phone, in person, via e-
mail or any other online method such as a social network.
Step 4: Presentation: The next step is the presentation of the product. The presentation should be
tailored to the customer by explaining how the product meets that person’s or company’s needs. This step
might involve a product demonstration, videos, PowerPoint presentations or letting the customer look at
or interact with the product.
Step 5: Handling Objections: Once the product has been presented to the customer, he/she may have
some hesitations or concerns called objections regarding the product. A goodsalesperson looks at
objections as opportunities to further understand and respond to customer needs. In order to sell the
product, it is vital to effectively handle these objections of the customer.
Step 6: Closing the Sale: Eventually, if the customer is convinced that the product will meet his/her
needs, the salesperson then closes the sale by signing an agreement with the customer on the terms of the
sale and finishing up the transaction. Once the close is successful, this step clearly aligns with the
purchase step in the buying process.
Step 7: Follow Up: The follow-up is an important part of ensuring customer satisfaction, retaining
customers and prospecting for new customers. This step allows understanding whether the customers
were happy and satisfied with the product. And it provides an opportunity to learn about new needs for
customer or new customers through referrals.
Following diagram depicts the process of selling:
Following is an example of a Pharmacy company explaining the process of selling followed by them
Source: www.slideshare.net/NasrullahKhanSwati/personal-selling-process-70766995

Qualities of an Effective Salesman

The job of sales executives is more action oriented. The sales executives do require certain essential
qualities to help them achieve their goals effectively. These qualities are as follows:
1. Pleasing personality: A good salesman should possess a good personality and the ability to impress
others. A charming personality always creates a good impression on the customers. The salesperson
should possess good health, attractive appearance and impressive voice as a part of his personality.
2. Cheerful disposition: Also, the salesman should have a smiling face and in order to impress the
customers, he should always be cheerful and sweet tempered. He should be properly dressed as the
dressing style greatly influences the mindset of the customers.
3. Mental intelligence:Asuccessful salesmanpossesses certain mental qualities like imagination, sound
judgement, presence of mind, foresightedness, initiative and strong memory. These qualities are of
great help to a salesman in dealing with customers having different nature and temperament and can
successfully tackle the customers.
4. Courtesy:A salesman should always be polite and courteous towards his customers as it helps to
develop good rapport and long term relationships with customers.The salesman should help the
customers and co-operate with them in providing them with all the necessary details and information
so as to make the right purchase decision.
5. Patience and Perseverance:A salesman comes across different type of customers and at times, they
may have to deal with difficult and angry customers. Under such circumstances, he should not lose
temper but give patient hearing to the customers and at the same time, he should try time and again
to convince the customers.
6. Complete Knowledge: A salesman should have complete knowledge about the product, the
companyand the customers. He should know his strengths and weaknesses and make constant efforts
to consolidate strengths and overcome weaknesses. Also, he should possess the complete knowledge
about the product so that he may properly answer the questions of the customers at the time of sale.
Apart from this, he should also have good knowledge of the company that he represents and to the
customer he is selling.
7. Empathy: A good salesman should be able to identify with customers, to feel what they are feeling
and make customers feel respected. It requires basically understanding the customer’s concerns
objectively. A salesperson’s empathy gains more trust and enables him to establish rapport with the
customers.
8. Positive attitude: The customers want to associate with the salesperson that are enthusiastic and
have an overall positive attitude. It is necessary for the salesperson to develop personal techniques to
manage any negative emotions and not to display these in front of the customers. The positive
attitude of the sales person has a good impression on the customers and can lead to a sale agreement.
9. Time Management: The saying that time is money is most apt for the profession of salesman. As
time management is the most important quality for the sales person. Allotting time to various
customers, closing deals in minimum time, providing different services to customers on time are the
some of the most important areas that the sales person should be paying attention to.
10. In constant touch with the customers:Successful salesperson always makes an attempt to keep in
touch with their customers. The salesperson can use a variety of approaches to accomplish that right
such as sending thank you messages, remembering birthdays or anniversary of customer, regular
phone calls, sending regular updates on the product launches etc. These techniques help the sales
person to be on the top of mind of the customers.
In the nutshell, the following diagram summarizes the qualities of a good salesman:

Source:yourarticlelibrary.com/salesman/top-qualities-of-a-successful-salesman/50987

Selection Procedure of Sales Personnel

Selection procedures for the sales person range from a simple one step process of having just informal
interview to the complex multiple step process involving proper screening of the candidate before final
selection.
Following are the different steps that can be undertaken for the purpose of selection of sales personnel:
Following diagram explains the selection procedure:
application blank final interview
Job analysis

Medical
advertisement prelimanary interview
examination

Job
References offer
screening Tests

1. Job Analysis:The sales manager needs to undertake job analysis which is the first step in the
selection of the sales force. Job analysis includes job description and job specification which
enables the sales manager to advertise the job effectively and accordingly hire suitable sales
representatives.Job description describes the duties and responsibilities of the job and job
specification specifies the qualifications and the qualities the candidate requires to perform that
job.
2. Advertisement:The sales manager then places the advertisement in the respective media so as to
receive applications for the vacant position. The advertisement should include all the necessary
details about the post in order to attract the right type of applicants.
3. Screening:The sales manager then undertakes the screening of applications which enables him to
select a few suitable candidates for the job position. A proper screening will help to select the
appropriate sales person.
4. Application Blank:The next step involves getting the application blank filled up by the
applicants. The application blank is a written formal application submitted by the applicant which
enables the sales selection committee to weed out undesirable candidates at the very outset.
5. Preliminary interview:Pre interview is for the purpose of eliminating unqualified applicants so
as to save the time of interviewing those applicants. The preliminary interview can be handled by
lower level managers so that only selected few who qualify at this step are made to go through the
next few steps of selection.
6. Psychological testing:Tests help to create situations in which an applicant reacts and such
reactions are considered as replica of his behavior in the work area for which he has applied. In
case of selection, two types of tests are held ‘personality’ and ‘aptitude’. Personality tests gauge
whether the candidate has good sales personality while aptitude tests measure his aptitudes in the
field of selling. Various other types of test such as IQ, EQ, stress, GK, etc can be conducted by
the organizations depending upon the nature of the job for which interview is conducted.
7. Finalinterview:Interview is both a formal and informal conversation between the interviewer and
interviewee. Interview is a crucial point in selection process and the interviewer is to be
sympathetic, receptive, accommodative and interested in the problems of the candidate. The main
purpose of interview is to form the opinion of applicant’s appearance, bearing, poise, voice,
resourcefulness and the philosophy of selling.
8. References: The candidate is asked to provide references of persons that guarantee of his
integrity. The reference check enables to verify about the applicant’s character, educational
career, past service or experience.
9. Medical examination:Confirmation of physical fitness demands that every promising candidate
to undergo a medical test. As the salesman’s job needs physical fitness in addition to mental,
persons with high blood pressure, foot affliction, kidney and heart troubles,etc. are not selected.
At the same time, it is the moral responsibility of the candidate to disclose the facts of his health
conditions.
10. Final interview:Once the candidate has provided all the detailed information in terms of
qualifications, references and has cleared physical and psychological test, the next step is to come
to final decision. In this interview, crucial questions are asked as to the candidates regarding
willingness to accept the job, reliability as to continuity, etc.
11. Job Offer:The final and the most important step is making the job offer to the right candidate.
Selecting a wrong candidate will wrongly impact the sales and overall performance of the
organisation in the long run.
It is to be noted that all organisations do not necessarily follow all the above mentioned steps in the
above mentioned sequence. Depending upon the type of the organisation and the nature of the job, the
steps are shortened or changed from organisation to organisation.
Training:
Training can be defined as an act of teaching or developing in oneself or in others, any skills/knowledge
that is related to specific competencies and which helps in achieving goal of improving one’s capability,
capacity, productivity and performance.
The objective of giving training is to improve the job performance. In absence of training, job
performance improves with experience. But such job performances without training sometimes take lots
of time. Training is given to the sales person so as to enable them to perform jobs satisfactorily thereby
reducing their turnover and saving selection cost and improve overall efficiency of the organisation.

Training Methods:
There are two basic methods of training which are:
On-the-job Off-the-Job
Training Training
Methods: 1. Induction Methods:
2. Apprenticeship 1. Lectures
3. Understudy 2. Conferences
4. Coaching 3. Supplying Sales Manuals
5. Job Rotation 4. Correspondence
6. Mentoring 5. Institutional
6. Visual aid
7. Brain Storming
8. Vestibule Training Or Simulation
Exercises
9. Management Games
10. Case Study
11. Role Playing
12. In-basket training
13. Sensitivity Training

A. Onthe Job Training:

On the job training is considered to be the most effective method of training salesmen. Under this method,
the salesperson is trained on the job at his place of work which enables him to get training under the same
working conditions and with the same process, materials and equipment that he will be using for the job
execution.
1. Induction Training:A newly appointed employee must be assisted to get acquainted and adjusted with
work environment. Thus, it is necessary to get him introduced to the organization and to help him to get a
general idea about the rules and regulations, working conditions, etc. Such training is called as induction
training.
2. Apprenticeship/understudy:A newly appointed salesman is made to work as an apprentice under a
senior salesman to learn the art of selling in this method of training. The newly appointed salesman works
under the senior salesman, observes his work and learns the art of salesmanship. However, it may be
possible that some seniors may not teach all the tricks of the trade to the apprentice.
3. Coaching: This method is also known as coach and pupil method and it combines telling, showing,
practicing and evaluating. The coach mostly professional sales trainer begins by making actual sales calls,
each one being followed by discussion and appraisal. Gradually, the trainee learns more through frequent
coaching. The deficiencies of the sales person are corrected by the coach while on the job.
4. Job Rotation:This method involves salesperson rotate around to different jobs within the organization
performing different tasks unrelated to the original job. By performing different jobs, the employees
develop more skills, understand their capabilities and enhance their performances.
5. Mentoring:This method of training focuses on the development of attitude. It is used for training of
managerial level sales person. Mentoring is mostly done by a senior level manager and is similar to
coaching, where sales person are guided on developing certain skills required for achieving further levels
of promotion.
B. Offthe Job Training:
Theemployees are required to attend training courses in institutions outside the organizationwhen the job
is complicated and requires much technical information or when on-the-job experience has to be
supplemented by further knowledge and experience. Classroom training is preferable as the atmosphere is
congenial and actual working conditions may be reproduced to enable the trainees to acquire actual-job
experience.
Various off the job training techniques are as follows:
1. LectureMethod:Under this method, lectures by experts on various aspects of selling are organized by
the firm for the benefit of the salesmen. The salesmen attending the lectures take down notes of the
lectures and also participate in the group discussions, seminars and written tests that follow the
lectures.The main advantages of this method are that salesmen get exhaustive information about the
products, markets, techniques of selling, etc. and it is an ideal method of imparting factual information.
2. Sales Conferences and Seminars:Under this method, the salesmen are invited to attend the sales
conferences, seminars and workshops at periodical intervals. These conferences and seminars help the
salesmen to think logically and take balanced decisions at the same time facilitating exchange of ideas
and experiences among the participants.
3. Supplying Sales Manuals:A sales manual is a book containing detailed information such as the
history of the firm, description of the job, product specifications, their prices, sales policies of the firm,
selling techniques, etc.prepared by experts to meet the specific needs of the salesmen.Under this method,
the sales manuals are prepared and distributed to the salesmen for their guidance.This method enables the
sales manuals to serve as ready reference material for the salesmen at work.
4. Correspondence Training:Under this method, postal trainingby sending the material to the salesmen
working in different sales territories is provided. The training office of the organisation prepares lessons
on principles and techniques of selling and sends the lessons to the salesmen by post. The salesmen study
these lessons thoroughly and the doubtsof the trainees are referred to the training office by the salesmen
by post.
5. Institutional Training:Under this method, the firm sends the salesmen to institutions which conduct
special courses on salesmanship and the course feesof the salesmen attending such courses are borne by
the firm. This method is practised only in certain institutions which are ready for sending their sales
personnel to these specialized courses on salesmanship.
6. Visual AidsTraining:Under this method, through visual training aids, training is given to the
salesmen and visual, audio-visual and audio aids are used to demonstrate the steps involved in the selling
process to the salesmen.Visual aids create more interest in the trainees and the topics which cannot be
made clear by explanation can be made very clear through visual aids.
7. Brainstorming: Under this method, five or seven trainee-salesmen are grouped under the
chairmanship of an experienced salesman who gives problems to the trainees and the trainees try to find
out the solutions to such problems. This method also enables to strengthen the team spirit and group
morale of the employees.
8. Vestibule training:A method that combined the benefits of the classroom with the benefits
of on-the-job training, called vestibule training, became a popular form of training. The
classroom was located as close as conditions allowed to the department for which the workers
were being trained. It was furnished with the same machines as used in production. There
were normally six to ten workers per trainer, who were skilled workers or supervisors from
the company.
9. Case Study Method:The case discussion method is a very effective training method because
individual cases and problems are discussed between seminar executives and salesmen. Before discussing
the actual cases, some hypothetical cases are framed and discussed at a higher level and the discussion is
designed to involve all the salesmen with a view to finding suitable solutions.
10. Role Play:This method of training involves by putting the sales personnel in real like problem
situations. The sessions involve the trainer describing the situation and the trainees are to play the roles
actively. Here trainees identify with the characters they portray and this type of training provides realistic
practice in applying what has been learned.
11. Gaming/Simulation: This method also known as simulation uses highly structured situations based
on reality, in which players assume decision making roles through successive rounds of play. The
advantage of this technique is that the participants learn easily because they involve themselves in game
play, develop skill in identifying key factors influencing decisions, understand the use and value of such
analytical techniques and also get the feedback from the referees immediately.
12. In-basket training: Method of acquainting new or promoted sales employees with the complexities of
their jobs by presenting them with a range of problems they might find in their 'in basket' when they take
up the job.
13. Sensitivity Training: It is one of the Sales force management techniques for bringing up change that
try to improve organizational effectiveness and employee wellbeing. It also helps the participants to learn
and adjust with the group dynamics. This technique was developed in 1940s by Ronald Lippitt and Kurt
Lewin.

Motivation:
Richard Still, Edward Cundiff, Norman Govoni are of the view that Motivation is goal directed
behaviour, underlying certain needs or desires. The complex of these needs and desires within an
individual leads them to act in a desired manner. As applied to sales person, motivation is the amount of
effort the sales person desires to expend on the activities associated with the sales job such as calling
customers, making presentations, filling reports, getting sales. Putting efforts on such activities lead to
certain achievement in the form of more sales volume, profitability, new accounts, achieving quota etc.,
which act as a motivating factor for the sales person.

Motivational Factors:
Various financial and non-financialtechniques are used by different organisations to motivate their sales
personnel. Some of the techniques are discussed as below:
1. Regular Interaction:The top management and sales managers must interact with the sales team
more often to understand their needs and expectations from the organization. The sales
representatives must have an easy access to the manager’s cabin at the times of queries
andtransparency is essential at all levels. The sales executives must be made aware of the latest
developments at the workplace.
2. Roles and responsibilities:Roles and responsibilities must not be imposed on any of the team
members.Job mismatch leads to the demotivated employees and the employees should be aware of
their Key Result Areas from the very beginning. A sales professional must be aggressive, smart and a
little diplomatic and must ensure a good follow up of the clients.
3. Realistic targets:Targets set for the sales team by the top management must be realistic and
achievable. If the team members find the targets unrealistic and hypothetical, they may be
demotivated to actively participate in the selling process to successfully sell the product to the client.
4. Incentives and monetary benefits:Attractive incentive schemes prompt the employees to work hard
with application and dedication and make the maximum use of their ability. Performance based
bonus and incentives must be provided by the firm in order toacknowledge the efforts of the hard
working employees.
5. Appreciation:Appreciation plays an important role in motivating the employees as it makes them
feel special and indispensable for the team as well as the organization. Appreciation by the sales
manager will enable the salesmen to achieve higher sales targets in future.
6. Recognition and rewards:The effective and efficient salesmen should be recognised by giving
awards and rewards to motivate them to perform better. The recognition and rewards system of any
organisation must be such that it pushes the employees to tap their best potential.
7. Worker’s involvement:The management may involve the team members of the sales in the
formulation of sales strategies. The sales managers should encourage initiative and suggestions on
the part of members of the sales team. This act as a motivating factor on the part of sales personnel
as they recommend realistic targets that they will be able to achieve in the time period given.
8. Proper compensation:One of the most important motivating factors for the sales personnel is the
compensation that they get at the end of their efforts. If there is a mismatch in the efforts and the
compensation offered or paid, it directly hits the motivation of sales personnel. They then tend to
reduce their efforts or leave the organization for better prospects to some other organization.

Compensation Methods of Sales Personnel

One of the most important decisions for any organisation is to decide on the compensation package of the
sales personnel as the right plan will motivate the sales people and thereby help achieve the business
goals without much risk. It should be remembered that every business depending on various factors
(internal and external) decides on the compensation plan that suits the best for them. There is no one
compensation plan which fits into all organisations. Different Compensation methods that can be
considered for sales personnel are as follows:
1. Straight Salary:It is the simplest and oldest compensation plan. In this, the sales persons get fixed
sums at regular intervals(usually at the end of week/fortnight/month), which represents total
payment for their services. The straight salary was once the most popular sales compensation
method, but it has been losing its importance recently. Straight salary plans are commonly used for
compensating sales persons engaged in such jobs which merely involve order taking, preparing
reports; follow up leads and more routine activities. The main advantage of this method is that there
is stability of income for sales personnel, and for the organisation fixed liability each month. The
main disadvantage is that due to fixed salary pattern, many sales people do only average job. If this
plan exists for longer time without any sales related incentives, the sales people turnover rises and
affects the organisation in the long run.
2. Salary plus Commission:This method supports the theory that individual sales personnel should be
paid according to the productivity and the sales volume is the best productivity measure. Some
organisations opt for progressive changes in the commission rates as sales volume increases to
different levels. While others, provide for differentiated commission rates for sales of different
products or to different categories of consumers. The greatest advantage of this method is that it
provides maximum direct monetary benefits to the sales personnel and which acts as a motivating
factor for them. More they sell, they get more commission. However, under this method sales people
may become careless in making reports, following up leads, adjust prices to take make more sales.
3. Commission only:This method of sales compensation involves paying sales personnel only for the
sales that they achieve and nothing else. This type of plan is easier to administer as only commission
based on the sales achieved has to be paid to the sales personnel. This method may attract few
hardworking people, who know that if efforts are focused on more sales, more commissions can be
earned. But this method may lead to more sales team turnover rate as there is no guarantee of income
till sales is achieved.
4. Profit margin:This method compensates sales personnel based on how well company is performing
due to sales people efforts. Profit Margin plans are mostly used in start up companies that have less
liquidity. This method motivates sales personnel to get sales and profits so as to earn maximum
share in that profit. This becomes a direct motivator for the sales personnel as more the profit, more
the share that they get.
5. Territory volume:This compensation method is more often used in team based volume of sales.
The entire sales volume of a territory is calculated and based on the total sales; the compensation is
distributed equally among all the sales personnel working in that territory. This plan works best
when the sales territories are clearly defined and sales team supports each other to achieve sales
goals and when the territories are large enough to give proper compensation amount.
6. Bonuses:Bonuses are different from commissions. Bonus is an amount paid for achieving a specific
sales target whereas commission varies in amount with the sales volume. Bonuses are paid for
reaching a particular sales quota and are an additional financial reward to the sales person for
achieving results beyond a particular limit. Bonuses are never used alone and are always given with
one of the main compensation methods such as straight salary, straight commission or commission
only.
7. Fringe benefits:Fringe benefits do not have a direct relation to job performance. These benefits are
provided for the other reasons such as competition in the industry, reducing turnover of sales
personnel and their satisfaction. Fringe benefits contribute to the safety and security, esteem and
other higher needs of the sales personnel. Such benefits are not motivators but when given prevent
job dissatisfaction. Certain examples of Fringe benefits can be holidays, leaves, pension plans, profit
sharing, insurance, other perks such as food allowances; education allowances reimbursements,
award, appreciations etc.
Factors Influencing the Compensation of Sales Personnel:
Internal Factors

External Factors

Ability to Pay Labour Market

Business Strategy Going Rate
Job evaluation and performance Productivity
appraisal Cost of Living
Employee Labour Unions
Labour laws
(A) Internal factors
The internal factors exist within the organization that influences the pay structure of the company which
is as follows:
1. Ability to Pay: Generally, larger companies can pay higher compensation as compared to their
competing firms whereas the smaller companies can afford to maintain their pay scale up to the level
of competing firm or at times, it may even be below the industry compensation standards.
2. Business Strategy: The organization’s business strategy also influences the employee compensation.
In case the company wants to employ trained and experienced salesmen, they have to offer more pay
as compared to the otherswhereas, if the company is willing to hire fresh and untrained candidates, it
may give relatively less pay or equivalent to what others are paying.
3. Job evaluation and performance appraisal: The job evaluation helps to have a satisfactory
differential pay for the different job positions in the sales department.The performance appraisalof
the salesmen on the other hand may enable them to earn performance based incentives and bonuses
in addition to their base salary.
4. Employee: The employee or a worker himself influences his compensation package on account of
his performance, experience and potential. Betterperformance leads to higher pay to the employee
which motivates them to undertake their job more efficiently.Also, as the employee becomes more
experienced as a salesman, he may receive higher pay package. Also, companies pay extra to the
sales employees that have better potential as compared to others.

(B) External Factors

The factors that exist out of the organization but do affect the employee compensation in one way or the
other are as follows:
1. Labour Market:The demand for and supply of labour also influences the employee compensation.
Incase the demand is less than the supply of labour, lower salaries may be given whereas high pay is
fixedin casethe demand is more than the supply of labour.
2. Going Rate: The compensation package is also decided on the basis of the rate that is prevailing in
the industry. The Going rate policy refers to payment of that amount that the other firms are paying
for the same kind of work.
3. Productivity: The compensation increases with the increase in the productivity and therefore, in
order to earn more, the salesmen need to work on their efficiencies.The introduction of new
technology, new methods, better management techniques are some of the factors that may result in
the better employee performance, thereby resulting in the enhanced productivity of the organisation
as a whole.
4. Cost of Living: The cost of living index also influences the employee compensation. Withthe
increase or fall in the general price level and the consumer price index, the wage or salary varies
accordingly.
5. Labour Unions: The powerful labour unions also influence the compensation package provided by
the company. The labour unions are generally formed when the demand is more and the labour
supply is less.The non-unionized organisations enjoy more freedom with respect to the fixation of
the compensation plan.
6. Labour laws: There are several laws passed by the Government of India in order to safeguard the
workers from the exploitation of employers.The Payment of Wages Act 1936, The Minimum Wages
Act 1948, The Payment of Bonus Act 1965, Equal Remuneration Act 1976, Payment of Gratuity Act
1972 etc. are some of the acts passed in the welfare of the labour.

Sales Organisation: Concept

Sales organization consists of persons working together for the effective marketing of products
manufactured by the firm or the products purchased for resale. Sales organization co-ordinates the efforts
of members of a group to bring about a desirable result and provides an efficient, economic and flexible
administrative set up to ensure timely movement of products from the warehouse to the ultimate
consumer.
A good sales organization is one wherein the functions or departments have each been carefully planned
and co-ordinated towards the objective of putting the product in the hands of the consumers through
efficient supervision and management so that each function is carried out in the desired manner. Existence
of sales organization implies the existence of structure of relationships among individuals and groups to
facilitate the accomplishment of sales objectives.

Objectives
The objective of sales organisation is not just to sell the goods to the distributors, but it does have
responsibility to get them consumed or used by the consumer too. Therefore the responsibility of a sales
manager extends much beyond the selling of the goods. Following are key objectives of a Sales
organisation:
1. Long term and short term objectives: (Qualitative and Quantitative) Sales organisation must
achieve both qualitative and quantitative personal selling objectives. In the long run, qualitative
objectives are those concerned with personal selling contributing to overall company objectives
and in the short run, it must attain the quantitative objectives such as profits, sales volumes. A
sales organisation involves group of people striving to achieve these qualitative and quantitative
objectives. It is believed that all individuals will cooperate to attain these objectives.
2. Assigning responsibility and authority to specialists:One purpose of the sales department is to
facilitate assignment of the responsibility and the delegation of the authority. It helps in getting
specialist doing respective tasks. As tasks are broken into smaller manageable tasks and are
assigned to specialized personnel, and clear responsibility is fixed, it leads to clearer roles and
helps to smoothly perform the processes of organisation.
3. Performance of activities: Sales organisation primary objective is to make sure that all the
activities under its ambit are performed well on time. Necessary control and supervision of all the
activities is necessary to be devised so that timely changes can be made.
4. Coordination of activities:Good organisation tries to maintain proper coordination or balance in
various activities and in departments. Motivating sales personnel to work together towards
common objectives is therefore important in creating and maintaining coordination. Personnel
must be brought together to work as a team rather than as individuals, then only organisation will
be able to collectively achieve its goals. Some of the means for achieving coordination are regular
meetings, supervision, training programs, guidance and proper communication.
5. Proper direction:Sales executives need to provide proper direction and orders to the lower level
of employees in the organisation hierarchy. This can be done by issuing orders in timely manner
and by defining clear role of each and every sales personnel.
6. Time management:As sales organisation activities and operations increase, it is necessary to
keep a check on the time that executives take to plan and perform these operations. Time must be
wisely spent on more important decisions and operations and lesser time on routine operations.
7. Proper Span of control:In planning the structure of sales organisation it is necessary that it
limits the number of sales executives (span of control) who reports directly to the managers.
Higher level sales managers need to have a narrow span of control as compared to lower level
sales managers who can have a wider span of control.
8. Increase in Managerial efficiency:A sound sales organisation aims to achieve increase in the
efficiency of the mangers at the lower and the higher levels. A clear definition of the duties, role,
authority, responsibility, position helps to achieve the managerial efficiency in the short and in
the long run.

Structure of Sales Organisation

Sales department can have many options to choose from while creating organisation structure. But,
creating the right and the most suitable structure can be difficult and a challenging task. Typically sales
organisation can have the following structure as shown in the below diagram:

Source:
https://www.edrawsoft.com/sales-organization-structure.php

The grouping of activities in to departments and positions and creating relationships of positions lead an
organisation to create a structure. The most common type of structure is Line organisation structure and
the line and staff organisation structure. The sales departmental structure is result of the needs of the
business, type of the product, type of the customer, marketing channels, company size, competitor’s
practices, and various other factors. Various types of Sales organisation Structures are as follows:

I. Line Sales Organisation structure:

It is one of the oldest and the simplest form of sales organisation structure. It is mostly used in smaller
firms having less sales personnel and the firms running over a limited geographical area. In this type of
organisation, all executives exercise line authority and receive instructions from one singe authority at
the level one above the executive. Responsibility is fixed and lines of authority flow vertically through
the structure
Line Sales Organisation Structure can be explained with the help of the following diagram:

General Sales
manager

Asst Sales Manager 1 Asst. Sales Manager 2

sales sales sales

personnel personnel personnel

It can be seen in the above diagram that assistant sales managers report to the general manager and sales
personnel reports to assistant sales managers.
Advantages of Line sales organisation:
1. Simple structure
2. Subordinates report to only one superior
3. Lines of authority and responsibility are clear and simple
4. Problems of discipline and control are small
5. Close relations between senior executives and sales persons
6. Few organisational levels
7. Scope for innovation
8. Suitable for small organisations
9. Low cost
10. Quick decisions

Disadvantages of Line sales organisation:

1. Not suitable for large organisations
2. Seniors take all decisions
3. Centralisation of power
4. Little opportunity for lower level sales personnel to display creativity
5. Less time for planning since senior executives look into all matters
6. Chain of command flows vertical only
7. No support to line managers from lower staff
8. Results may be disappointing if taken by only senior managers
9. Close relations may not sustain if operations and activities increases.
10. Senior managers may dictate decisions to lower level personnel.
II. Line and Staff sales organisation:
Theline and the staff sales organisation is often found in medium and large sized organisations. When
organisations employ large number of sales personnel, selling diversified products, operate over wide
geographical area, line and staff organisation is adopted. In this type of structure, there is a provision of
group of experts/specialists in various areas to the top level executives. These staff expertise could be in
areas such as sales planning, sales training, dealer and distributor relations, sales promotion, warehousing,
services, sales analysis etc. The staff experts assist line managers in handling various activities in an
organisation.
Line and staff Sales Organisation Structure can be explained with the help of the following diagram:

Source:https://www.transtutors.com/homework-help/industrial-management/organization/line-and-staff-structure-
organization.aspx

III. Functional Sales organisation:

This type of structure is derived from the theory of management expert Frederick W. Taylor, which is
based on the premise that every individual in an organisation should have some distinct duties as far as
possible. The principle of specialisation and due duties and delegations should be made according to
functions. In this type of structure, sales people receive instructions from several executives on different
aspects of their work.

Functional Sales Organisation Structure can be explained with the help of the following diagram: It shows
that, sales personnel receive instructions from various executives.
Source:
http://kalyan-city.blogspot.in/2010/06/organisation-organizational-structure.html

Advantages of functional sales organisation:

1. Improved performance
2. Qualified specialist guiding sales force
3. Increase effectiveness of sales force
4. Suitable to large firms
5. Simple to administer

Disadvantages of Functional sales organisation:

1. Costly structure
2. Lack of coordination
3. Not suitable to small and medium sized organisations
4. Confusion due to more managers giving orders to sales persons

Steps in Developing a Sales Organisation:

Following chart explains the steps in developing a sales organization:

I. Define the 2. Activities 3. Position

objectives determination creation

5. Coordination 4. Personnel on
and Control positions
There are five major steps in setting up a sales organisation as described by Richard Still, Edward Cundiff
and Norman Govoni:
1. Defining the objectives:The initial step in setting up of a sales organisation is to define the sales
department’s objectives. Top management defines the vision and the long term objectives for the
organisation and from these sales department objectives are derived. Survival, growth, stability
are different strategies that the top management can decide for the entire organization and from
these qualitative and quantitative selling objectives are derived. The sales department as a whole
operates smoothly when its activities are purposeful and it has specific quantitative objectives.
These quantitative objectives set for the sales department governs its policies and long term
performance. These objectives set the foundation for day to day operation of sales department.
2. Determination of activities and their volume of performance:The second step to sound
organization design is the recognition of all the activities that will be performed and estimating
their volume of performance.Determining the necessary activities and their volume of
performance is a matter of analysing the sales department qualitative and quantitative objectives.
In simple words, which activities are to be performed to achieve those objectives are to be
determined.
3. Grouping activities into positions:The activities identified are allocated into different positions
in the sales department. Activities are classified and grouped so that all closely related tasks are
assigned to the same position. Each position should be given a proper number of tasks so as to
make job challenging and interesting. Certain activities that are of crucial importance to the
success of sales department, has to be kept at higher level. Activities that are of lesser importance
are assigned to lower level jobs. The planner has to make sure that making more positions will
increase the levels in the department and more levels may create the problem of coordination and
various other problems.
4. Assignment of positions to personnel:The next step is to assign personnel to the positions. This
involves finding out the right person for the position according to the duties and responsibilities
of the job. The department may have an individual already working in the organization to be
given this position. Else, the organization has to recruit and select the personnel for the position
by proper selection procedure. In simple words, it is matching of the personnel capabilities and
the duties of the job positions.
5. Provision of coordination and control:Sales executives are required to control their
subordinates and also to coordinate their efforts. Sales executives should not be overburdened
with too much of coordination and control responsibilities. Thus while providing for control and
coordination, due consideration is must to be given to the span of control of the executives.

*****
4 Sales Planning and Controlling

 Sales planning : Concept, Process, Sales Forecasting - Methods and Limitations

 Sales controlling : Concept of Sales Budget and Sales Audit, Sales Quota -
Methods and Types, Objectives and Factors Determining and Designing Sales
Territory
 Recent trends - Importance of Customer Feedback, Sales Management - Data
Mining, Role of IT

Sales Planning: Concept

Sales planning refers to the business activity of estimating future sales of products or services
and accordingly setting sales targets. A sales plan is a strategy that sets out sales targets for the business
organisation and identifies the steps to be taken in order to meet those targets.It is nothing but a strategy
that sets out sales targets and chalks out strategies and plans to achieve these targets.
According to American Marketing Association: “Sales planning is the work of setting up objectives for
selling activities, determining and scheduling the steps necessary to achieve these objectives”.
Sales’ planning is the managerial task of determining the sales objectives, defining future course of
selling functions to achieve predetermined goals of an organization.

Process of Sales Planning

The process of sales planning involves defining the objectives of sales, analyzing the organization’s
situation, setting objectives, determining market potential, forecasting sales, making detailed plans based
on it, organizing resources to operations and performing the control function. Following are the steps
involved in the process of sales planning:
Following diagram clearly shows the process of Sales planning in detail.

Evaluating
Defining Sales
alternative
objectives forecasting
plans

sales Selection of
Evaluation the best plan
strategy

Determining Implementat
alternative
market ion of plan Sales Control
sales plans
potential

1. Defining objectives:The first step in sales planning is to clearly define the sales objectives. Well
defined objectives enable to effective implement and timely achieve the sales targets. The sales
objectives must be SMART - Specific, Measurable, Achievable, Realistic and Time bound. It is
necessary also to communicate well the various sales objectives planned so that the middle and
the lower level of sales executives find it easier to achieve.
2. Evaluation/analysis of the current situation:Once the sales objectives are clearly defined, the
next step is to evaluate the current situation prevailing in the market. Actual planning process
starts with the assessment of the situation, internal and external, where the organization exists. A
proper assessment of the current situation inside the organisation as well as in the market will
enable the firm to clearly anticipate demand and accordingly, undertake production and inventory
control.
A) The assessment inside the organization involves analysis of organization own data of sales, products,
distributors, territories, volumes, market size, its promotion budget, promotion strategies, promotion mix,
distribution channels etc.
B) The assessment outside the organisation includes finding information about market, potential
customers, their buying pattern, their likes and dislikes. It also involves analysis of the information about
the competition such as number, their strengths, weaknesses, their strategies.
Analysis of internal and external environment will enable the organization to understand its strengths,
weakness, opportunities and threats. This helps to make planning more effective and detailed.
3. Determining market potential:This step involves determining the potential of the market in
terms of trends that are shown in the market in a given period of time. This helps the organization
to understand its position in the market. This is based on the study of the market in relation to
various factors such as demand from the consumer, their behavior, their likes and dislikes. It
involves understanding whether it is viable to sell the product in the particular market, to
particular consumers.
4. Sales forecasting:This step involves estimating the quantity of the product which can be sold in
the market in certain future period under consideration. Sales forecast estimation depends on the
market potentiality. If the market seems to be more potential in terms of demand and trend,
forecasting figures will be positive in that market and based on that more efforts will be
concentrated in that respective market.
5.Strategic planning of sales strategy:The next step is to formulate the sales strategy. A strategy is a
well-defined plan of action that helps to achieve the long term sales objectives. Thus, an effective
sales strategy is a vital step in sales planning. This step involves selection of a suitable sales
strategy, which will be adopted to achieve the sales targets. The sales strategy will give an entire
plan/ course of action of an organisation to achieve its targets.
6.Framing alternative sales plans:Once the sales strategy is framed, the sales manager then needs to
frame alternative sales plans or sub plans. . It is always advisable to formulate few alternative
plans so that the sales managers can select the best plan from various options available. The
alternative plans should be such that it helps to achieve the overall sales objectives of the
organisation
7.Evaluating alternative plans:The various alternative plans are evaluated and analysed in terms of
costs, benefits, time and other factors. Generally, cost benefit analysis of each and every sales
plan is undertaken by the sales manager.
8.Selection of the best plan: After conducting cost benefit analysis of each and every plan, the sales
manager selects the best feasible plan of all. The manager selects the plan that helps to achieve
maximum benefits at minimum costs.
9. Allocation of resources: (Implementation of plan)After the best sales plan is selected, it is
necessary that the resources such as finance, materials, man power, physical and others are
organised in time and are allocated timely to the sales personnel so that it helps in achieving its
sales objectives. It is necessary to give proper direction, constant communication and motivation
to sales team on regular basis.
10.Review (Sales Control): As the sales plan is being implemented, the manager then needs to
undertake periodic review of the same to ensure that the sales plan is being implemented in the
right direction. If any deviations are found, corrective measures can be taken on time. Continuous
monitoring systems need to be devised by the management to control the operations. Regular
checks help to find out the deviations so that remedial measures can be taken in time.

Sales Forecasting
Sales forecasting is the process of estimating sales at the future period. It involves estimation of the
quantity and the quality of the future sales. It is necessary for any organization to assess the trends
prevailing in the market right on time so as to enable the companies to make informed decisions, manage
its resources, workforce, cash flows, planning of entire department. It helps to predict short term as well
as long term performance.

Methods of Sales Forecasting:

1. Jury of Executive Opinion:Jury of Executive method of sales forecasting is one of the oldest
method in which one or more of the executives who are experienced and have good knowledge of
the market factors estimate the expected sales. The executives are responsible for forecasting the
sales figures through estimates and experiences and all the factors - internal and external are
taken into account. This method is a simplest method as experiences and judgements are pooled
together in taking a sales forecast figure.
2. Sales Force Opinion:Under this method, salesmen or intermediaries are required to create an
estimate of their sales in their respective territories for a given period of time. Salesmen are in
close touch with the consumers and possess good knowledge about the future demand trend
which is why this method is a good one. Thus, all the sales force estimates are processed,
integrated, modified and a sales volume estimate formed for the entire market for the given
period.
3. Test Marketing Result:Under the test marketing result method, products are introduced in a
limited geographical area and the result of the same is studied. Taking this test market result as a
base, sales forecast is made. This test is conducted on a sample on pre-test basis in order to
understand the market response towards the product.
4. Consumers’ Buying Plan:In this method, cconsumers who act as a source of information are
approached to know their likely purchases during the period under a given set of conditions. This
method is especially suitable when there are few customers like in the case of industrial goods. It
is suitable for industries, which produce costly goods to a limited number of buyers- wholesalers,
retailers, potential consumers, etc. A survey is conducted on face to face basis or survey method
as changes are constant while buyer behavior and buying decisions change frequently.
5. Market Factor Analysis:A company’s sales may depend on the behavior of certain market
factors and as such the principal factors which affect the sales may be determined. By studying
the trends in these factors, effective and accurate forecasts can be made. The key to the successful
use of this method lies in the selection of the appropriate market factors as well as minimizing the
number of market factors. Thus the demand decision makers have to consider price, competition,
advertising, disposal income, buying habits, consumption habits, consumer price index, change in
population and various other such factors.
6. Expert’s Opinion:Many types of consultancy agencies have entered into the field of sales and
these consultancy agencies have specialized experts in their respective field including dealers,
suppliers, trade associations, etc. They may conduct market research regularly and may possess
important statistical data. Firms may make use of the opinions of such experts which may then be
carefully analyzed by the company and a sound forecasting can be made.
7. Econometric Model Building:Econometric model building is a mathematical approach of study
and is an ideal way to forecast sales. This method is more useful for marketing durable goods and
is in the form of equations which represent a set of relationships among different demand
determining market factors. By analysing the market factors and sales, appropriate sales forecasts
are made. However, this system does not entirely depend upon correlation analysis.
8. Historical Method:Personal judgement of sales forecasting can be beneficially supplemented by
the use of statistical and quantitative methods and past sales are a good basis on which future
sales can be formulated and forecasted. According to Kirkpatrick, today’s sales activity flows into
tomorrow’s sales activities; that is last year’s sales extend into this year’s sales. This approach is
adding or deducting a set of percentage to the sales of previous year.
9. Statistical Methods:Statistical methods are considered to be superior techniques of sales
forecasting as their reliability is higher than that of other techniques.the various statistical
techniques include trend analysis, graphicalanalysis, time-series analysis, freehandmethod, semi-
average method, moving average method, method of least square, correlation method and
regression method.

Limitations of Sales Forecasting

Sales forecasting though helps in estimation of future sales, but it suffers from certain limitations which
are as follows:
1. Changes in Tastes and Preferences:The tastes and preferences of the buyers do not remain constant
and a sudden change in the tastes, preference, needs, wants, likes, dislikes or buying behaviour of the
buyers may render the forecasts meaningless.
2. Unstable Economic Conditions:The economic conditions prevailing in every country do not remain
stable and keep changing from time to time. Economic factors like purchasing power of the people, desire
to save and invest, inflation, recession or depression and other such factors adversely influence the sales
forecast.
3. Changing Political Conditions:The political conditions in the country also influence the sales
forecast. The policies framed by the Government regarding business are often modified and a sudden
introduction or changes in the tax policies such as GST by the Government affects the sales and therefore
the sales forecast.
4. Entry of New Competitors:The entry of competitors may also affect the sales of the organisation as a
firm enjoying monopoly in the market may lose such a position especially if the buyers find the
competitor’s products more superior. Therefore, the sales forecasts may be affected and they may turn out
to be inaccurate.
5. Technological Advancements:Advancements in science and technology may render the present
technology obsolete and the products which enjoy a good market may lose market.Thedemand for
products that make use of the latest technology increases and this is particularly true in the case of market
for electronic goods, computer hardware, software and so on.
6. Tendency to be positive:The problem with sales forecasting is that sale personnel may tend to be very
optimistic about the environment and the sales that will happen. They may have a belief that they will
achieve better sales next year as compared to the sales achieved in current year. If majority of sales
people start giving positive company forecast, it may lead to over estimation of sales, which may not be
achieved if there are changes in the market.
7. Lack of past sales figures:While sales are forecasted, it should be based on some past sales figures. In
some organizations, if such records are not available then the forecast is based on intuition or guess work
or gut feeling. Such forecasted figures may not be realistic to be achieved in future. .
8. Internal Bias:Sometimes while doing forecasting, the challenge for the organisation executives and
sales personnel is to avoid internal bias. Sales projections need to be realistic and not based on personal
opinions, prejudices or any kind of biasness among the sales staff.
9. Human Limitations:One of the major problems of sales forecasting is the reach of the person
estimating sales. It is not possible for the person to reach for information across all departments,
individuals, products, markets, consumers etc due to time, money and other limitations.
10. Unexpected contingencies/occurrences:Every business tries to reduce the short comings of sales
forecasting by using proper techniques. Unfortunate/unforeseen events or occurrences sometimes make
the entire effort of sales forecasting waste as the sudden happening of situations, events were not taken in
to account were not considered. Each of these events do affect the accuracy of the forecast and more
severe the event effect, the possibility is that sales forecasting will not be accurate.

Sales Controlling
Sales control is one of the functions of sales management which ensures the achievement of sales and
profit objectives of the company by effectively coordinating the different sales functions. The sales
control process can be executed either through behavioral aspects like sales efforts and allocation of
selling time or through cost aspects like performance expenses and sales-function administration. The
sales team needs to be well trained in order to maintain a consistent effort in sales and to ensure efficiency
of the sales staff. Sales budget and Sales Audit are the basic tools to control the efforts of Sales control.
Four key activities remain in the management process, which are establishing performance standards,
measuring performances, evaluating performances against the standards and taking action. These four
steps or key activities constitute Sales control. The key managerial functions that are planning,
organizing, coordinating and controlling are inter related activities,
Concept of Sales Budget and Sales Audit
(A) Sales Budget:
A sales budget facilitates the estimation of sales in units as well as the estimated earnings from these
sales. Budgeting is important for any business as without a budget, companies cannot track process or
improve performance. The top management carefully analyse economic conditions, market competition,
production capacity and selling expenses when developing the sales budget as all of these factors play an
important role in the company’s future performance. In other words, the sales budget is what management
expects to sell and the revenues collected from these sales. It is a blueprint for making profitable sales. In
simple words, the sales budget consists of estimates of a specific future period, estimating the cash flow,
profits and the likely selling expenses.
(B) Sales Audit :
The sales audit is a comprehensive, systematic, periodic, analysis, evaluation and interpretation of
business environment, objectives, strategies, principles undertaken in order to determine the areas of
problem or opportunities and giving recommendations for the plan of action so as to improve the overall
sales performance. It is the systematic and unbiased review of the basic objective and policy of the selling
function of an organization and helps to improve the effectiveness of sales of the organization. The sales
audit is performed by the sales auditor who can be from within the organization or from outside the firm.
Auditors normally examine six aspects such asobjectives of the company, internal policies, and structure
of the organization, sales methods, procedures and sales personnel.
According to Richard Still, Edward Cundiff, NormanGovoni:
“A sales audit is a systematic, critical and unbiased review and appraisal of the basic objectives and
policies of the selling function and of the organisation, methods, procedures, and personnel employed to
implement those policies and achieve those objectives”
A sales audit helps to identify strengths and weakness so as to exploit various potential for improvements.
Sales audit differs from company to company, but every sales audit do examine six main aspects of
selling operations which are objectives, policies, organisation, methods, procedures, personnel.
Sales Quota - Concept
Sales quotas are quantitative goals that are set by managers to measure and compare the performance of
individual salesmen and to determine their compensation accordingly. Any kind of sales figures given to
any particular person or region or distributor is called Sales Quota which can be measured either in terms
money or the stock of goods sold. It is particularly an amount of target sales that is assessed on daily or
monthly basis and to assess the performance of an individual sales person, his ability to meet the given
target is considered. Quotas are the tools that help in directing and controlling sales operations. All quotas
are time bound which means the quantity that is expected by the management in a given period of time.
Methods of Sales Quota
1. Top management Downward Method:In this method, the management and executives with the
help of their experience and judgment estimate the total sales for the next year. Sales executives
having enough experience in the sales are given the responsibility of setting such sales quotas and
this method is sometimes referred to as guess work quota method because it is estimated on the
basis of executives’ guess work.
2. Territorial Estimate Upward Method:Territorial estimate method is also known as grassroots
approach. In this method, the salesmen are asked to make an estimation of sales of their territories
for the coming years and the branch managers make adjustments in the salesman’s estimates. The
district and divisional sales managers make further adjustments of salesman’s estimates with the
cooperation of sales force and finally, all such sales estimates are grouped and the sales quota of
the entire sales field is prepared.
3. Combination of top management-downward and territorial estimate-upward method:In this
method, two methods - the top management downward method and territorial estimate upward
method of estimating sales quotas are combined. At the headquarters, the management, by their
past experience and judgment estimates the sales quota whereas at the grassroots level, the
salesmen are asked to make their own estimates. Lastly, an overall quota for the entire sales
operations of the company is prepared based upon both the estimates and the quota is then
divided into territories, products and salesmen.
4. Past performance Method:Under this method, sales quotas are made keeping in view the past
sales performance and the total sales quota for the future is framed by increasing the sales by a
certain percentage. The increase is made keeping in accordance with the competition,
advertisement, economic condition, price of the product, etc. which is then divided into sales
quotas for each division, district, branch and individual salesman.
5. Executive Judgement Method:In this method, sales quota volume is determined by the
management, but it is more likely to be a guess. The management decides the sales
quantity and no fixed procedures are involved. This method is not precise and it’s mostly
not used by organizations to determining the sales quota. This method doesn’t provide
any estimate for territorial based sales volume.
6. Sales People Estimate Method: In this method, the sales quota is determined by the
salesperson of the organization. Through this approach, a more relevant sales estimate
can be maintained, which can be achieved by the salesperson. Salesperson have better
knowledge of the market conditions, so they can set the target as per their standards, and
if the standards are set by the salesperson themselves rather than imposed by the
management, their fulfillment is more likely possible.
7. Compensation Plan Method:Compensation method is based on management’s view of
what a particular salesperson should receive as revenue; this method does not take into
account the sales projection or territorial volume. For example, if a salesperson has to
receive 20,000 as salary, which can be received as 10 percent commission of the sales
amount, then the salesperson has to sell products worth 200,000.

Types of Sales Quota

Every organisation technique of setting quotas depend on forecasting and budgeting procedures,
management philosophy, selling problems, quota setting procedures of the organisation. Typically quotas
fall into four categories such as sales volume, budget, activity and combination.
1. Sales volume and Unit volume quota: The sales volume quota is the oldest type of quota. It includes
sales in monetary terms or units sold for a specific period of time and this type of sales quotas is generally
set for one year. The sales teams are then assigned their yearly quotas to be accomplished and these
quotas are set in the areas of product line, product range, branch offices and individual salesperson. In
simple words, this type of quota, managers/sales personnel are told “how much to be sold for what
period”
2. Profit quotas: Profit quotas are very useful for FMCG companies as various products add to varying
levels of profits. The advantage of this type of sales quota is that the sales person can use his time
optimally and therefore, one can strike a balance between high and low profit yielding products of the
firm.
3. Budget quotas:Financial or budget quotas are determined to achieve the desired income and to control
incurred selling expenses. In simple words, it is to set to different units so as to control expenses, gross
margin and net income.
4. Expense Quotas: The expense quotas are linked to selling costs with a realistic time frame. Few
companies set quotas for expenses to different sales levels achieved by the sales person. The sales team
may be given an expense budget which is a percentage of a particular region’s sales volume and the
salesman should spend only that sum of money in the form of expenditure.
5. Activity Quotas: In case of activity quotas, the sales team is required to execute other activities that
will have a long term bearing on the company’s goodwill. Here certain objectives related to the job are set
in attaining the performance targets of the sales force and may include quantity of sales presentation
made, amount of calls made, number of dealer visits, recovery calls made, new clients procured and other
such activities of different types.
6. Combination quotas:Nowadays, managers in various firms are designing new types of sales quotas
called as combination quotas that combine two or more activity or behavior based goals. These goals are
chosen in order to reinforce a set of skills that the sales personnel are expected to master and continually
improve. For instance, a combination quota could include number of customer calls, percentage reduction
in sales expenses, number of product demonstrations, frequency of conversions from trial to sale,
percentage of customers who repeat or increase purchases or number of new accounts opened.
7. Forecast: A company may base a sales quota on a combination of a sales forecast for a particular
geographic area and historic sales data. For example, assume that region A was responsible for 25 percent
of the prior year's sales and the sales forecast for the current year is $150,000. The current quota for
region A might be 25 percent of $150,000 or $37,500.
8. Revenue: The most common type of quota is based on revenue for a quarter or month.
Industries with long selling cycles may use annual quotas. In many cases, commissions are
designed such that salespeople who reach quota receive far more compensation than those who
are under quota. A quota may consider a large number of factors such as the difficulty of selling
a particular product in a particular territory.

Sales Territory
A sales territory refers to a geographical area that is assigned to a salesman for the purpose of marketing
the products of his concern. Generally, a firm divides the markets into specific geographical zones and
assigns each salesman a specific zone in which he has to carry out his selling operations. This specific
geographical zone assigned to a salesman becomes his sales territory and each territory is served by one
or more salesmen.
Objectives
1. Better management of sales representatives’ activities:A sales territory facilitates better
management of the activities of the sales representatives as each representative operates within a
specified area and deals with a specific group of prospective customers or clients. Thus, it becomes
easier to keep a track of the activities of the salesmen and ensures that the sales objectives are
successfully achieved.
2. Closer supervision:The sales manager knows which sales representativeis dealing with which
account and also know where to find each sales representative if they wish to contact them urgently.
The sales territories enable the sales manager to exercise close supervision on the activities of the
sales representatives and other important factors such as time spent on selling and travelling,
efficiency of routing and overall coverage of the territory.
3. Study of sales territories:A sales territory enables easier study of each and every territory
thoroughly. Therefore, sales managers can gather much more detailed and accurate information
about a well-defined area and a particular group of prospective buyers rather than about wide and
general areas.
4. Saves sellingtime and expense:Sales representatives may easily spend up to 40% of their working
time on travel and the use of a well-defined territory allows the salesman to carefully plan his routes
which decreases travelling time and increases the overall selling time.
5. Opportunities for sales personnel:Establishing sales territories enables to make arrangement of
similar opportunities for sales for sales representatives. Managers can establish territories to give
each sales representative about the same share of the available and potential market as measured by
factorssuch as population, income, number of outlets and standard of living.
6. Helps to face competition:Formation of sales territories helps to meet competition better. Managers
can more-easily appraise competitors’ strengths and weaknesses and compare this appraisal with
their company’s activities. Thus, sales managers can consolidate strengths and correct weaknesses of
the firm.
7. Performance measurement and comparison:Also, due to sales territories it becomes easier to
compare the performances of sales representatives. As sales representatives operate under known and
controlled conditions such as potential markets, amount of advertising, number of outlets and
appraisal of strength of competitors, a more-accurate basis for measuring and comparing their
performances enables to reward hard working employees.
8. Better service to customers:Representatives get to know the customercomplaints and problems
within their territory and can find solutions more easily. Managers can select and train a particular
type of representative to service a territory with unusual problems. However, without such clear
objectives in setting territories, managersmay not make decisions on such matters.
9. Accurate Marketing Research:On account of sales territories, market research becomes easier and
more accurate. Managers find it easier to study various aspects of marketing within a defined area
and can more easily study potential sales, customer needs, buying motives, purchasing power,
effectiveness of advertising, appraisal of competition and various other facts relevant to the creation
of sales quotas and budgets.
10. Higher efficiency:A clearly-defined task for representatives leads to higher efficiency. Efficiency is
the ratio of returns to cost. Representatives with definite work standards tend to work harder and
better than representatives without standards therefore leading to higher results at lower costs.

Factors Determining Sales Territory

1. Nature of the product:The nature of the product is of utmost importance. There are certain consumer
items which have constant demand in the market and are high turnover goods which need very little
selling efforts. Thus, for such products a large territory can be assigned whereas for luxurious, bulky and
durable articles which need concentrated selling efforts, small sales territory can be assigned.
2. Demand for product:The demand for a particular product should also be taken into account while
allocating sales territories to salesmen. If the demand for a particular product is constant and frequent then
the sales field can be divided into small sales territories. However, in case of low demand and infrequent
purchase of articles, the size of the sales territory should be large.
3. Transport facilities:The marketing of a particular product also depend largelyon the availability of
transport facilities. If the transport facilities like road, railway and air links etc., are satisfactory then large
sales territories can be allotted to salesmen. However, areas having poor transport facilities should be
divided into very small sales territories. If the company provides vehicles for the transport of salesmen
then larger sales territories can be assigned.
4. Competition and frequency of contact:Competition cuts the size of the territories and increases the
frequency of contact. In other words, the salesman has to meet dealers and customers very frequently in
highly competitive areas whereas limited competition reduces the frequency of contacts between the
salesmen and thecustomer which is why the salesmen can be assigned larger sales territories.
5. Population:The density of population in a particular area also determines the size of the sales
territories. If particular area of a territory is thickly populated, there arises the need to divide the sales
field into small sales territories whereas on the other hand, if the area is thinly populated, then larger sales
territories can be allocated to salesmen.
6. Distribution System:The distribution system of a particular organization determines the size of its
sales territories. In case the company sells through middlemen like wholesalers, dealers, retailers etc.,
larger sales territories can be allocated to salesmen whereas if the product is sold directly to consumers or
very few middlemen are used then small sales territories can be assigned to salesmen.
7. Advertising and sales promotion activities:Companies which have widespread advertising and
other sales promotion activities, can assign small sales territories to each salesmen in view of the demand
for the product created by advertisements whereas on the other hand, low advertised products need large
sales territories for each salesman.
8. Ability and experience of salesman:The size of the sales territory also depends on the ability and
experience of the sales personnel. Experienced and talented salesmen are able to sell more and therefore,
can easily be allotted large sales territories whereas new and inexperienced salesmen are usually allocated
small sales territories as their ability to sell is limited.

Designing Sales territory

Many companies do not have balanced sales territories which is not good for company’s
development. Some territories have too much opportunity and others have too little work. Hence
there is a need to focus on such territories where they don’t have much opportunity and may
struggle to make quota, and often feel under-appreciated. Where they have ample opportunities
have less work to the sales people, this imbalance results in lower market share, slower growth,
and higher costs due to employee turnover. Through sales territory design can transforms sales
forces by balancing sales, potential, or work among every territory. This territory optimization
technology delivers a balanced sales force with more manageable territories, more motivated
representatives, and higher salesperformance.

Gather and Existing Territory Analyze Existing Determine

analyze data Performance Customer Spend Market Potential

Review and Map Prospects &

Produce
Refine Territory Customer Data to
Territories
Assignments Territories

1. Gather and analyze data: Collect historical sales performance data by rep, territory and account
for at least one year up to three years, if possible. Assess the total addressable market by
collecting market data, including information about current and prospective customers.
2. Existing Territory Performance: Study the organization’s current territory performance. To
find out and understand which representative are hitting target, where are margins and sales
strong, etc.
3. Analyze Existing Customer Spend: Perform account segmentation for the customer’s portfolio.
In this step, a company study and determine the drives for customer spend in the business which
is crucial part. It could be a particular geography, seasonality factor, type of industry, revenue or
employee size, or perhaps all of these factors culminating in the sweet spot for business.
4. Determine Market Potential: Once a company understands the drivers to customer spend,
forecast market potential. Then a company discuss the various techniques to tackle this process
in detail. Ultimately, upon the completion of this step a company should have an estimate for total
market size.
5. Map Prospects & Customer Data to Territories: This step is the actual territory creation.
Decide the right balance among pure prospects, existing customers, and qualified opportunities
in each of those territories.
6. Produce Territories: In this step a company will decide upon the final vertical or geographic
boundaries for each patch and decide the sales management approach for every type of sales.
7. Review and Refine Territory Assignments: After the final territories are drafted, it is crucial to
walk through historical and probable opportunity conversion and customer win rates, and
compare the opportunity to each sales person’s quota. Perhaps a boundary needs to be shifted to
move more potential away or to a particular territory.

Recent Trends
Importance of Customer Feedback
Customer feedback refers to the information provided by clients about whether they are satisfied or
dissatisfied with a product or service of the company which acts as a resource for improving customer
experience and adjusting sales actions to their needs.
1. Improvement in products and services:Customer feedback provides an insight into what is working
well about the product or service and what should be done to make customer experience better. Customer
feedback is more valuable than professional knowledge in order to introduce modifications in product and
product design.
2. Leads to customers’ satisfaction:Customer satisfaction and loyalty is a crucial factor that is an
importantdeterminant in company’s financial performance. Customer satisfaction takes place when
product performance meets customer expectations. Customer feedback enables the firm to design the
products and services as per customer expectations thereby resulting in customer satisfaction. Satisfied
customers become loyal to the firm on account of repeat purchases and also recommend it to others.
3. Customer involvement:Collecting customer feedback is an indication that the firm values
their opinions. Valuable suggestions are welcomed from customers and some firms especially in case of
B2B business treat their customers as partners. As customers become more involved with the firm, they
are more likely to remain loyal to the brand. Customer feedback puts a customer in the central position
which in turn leads to effective customer involvement.
4. Better customer experience:Customer feedback helps to create the best customer experience
especially when today’s marketing is heavily based on experiences people have with products, services
and brands. Therefore, it is vital to focus on providing the best customer experience at every touch point
so that the clients become brand loyal and brand evangelists. Proper customer feedback is one of the best
ways to provide a good customer experience.
5. Improves customer retention:Customer feedback also helps to improve customer retention as
satisfied customers tend to become loyal to the organisation. Customer feedback helps you determine if
the customers are satisfied with the particular product or service and detects possible areas for
improvement. Customer feedback enables the firm to resolve the issues of dissatisfied customers
therefore, leading to customer retention.
6. Acts as a reliable source of information:Customer feedback is a reliable source for information to
other consumers especially in the time of social media. Opinions provided by other customers who have
already used a product or service are more reliable source for information. Many companies today
incorporate review system in their products and services as customers feedback is as important to the
business as to other customers and the manager must ensure that the clients have an easy access to
opinions and reviews.
7. Facilitates sound decision making:Customer feedback provides the organisation with data that helps
to take better business decisions. Successful businessmen gather and manage distinct data that helps them
develop future strategies. Thus, customer feedback enables the firm to adjust their products and services
to perfectly fit customer needs and make sound, quick and quality decisions with respect to the same.

Sales Management - Data Mining

Data mining is a process used by companies to turn raw data into useful information by using software to
look for patterns in large batches of data. Data mining enables businesses to learn more about their
customers and develop more effective marketing strategies as well as increase sales and decrease costs.
The effectiveness of data mining depends on the effectiveness of data collection and warehousing as well
as computer processing.
1. Association:Association is one of the best-known data mining technique in which a pattern is
discovered based on a relationship between items in the same transaction. Therefore, the association
technique is also known as relation technique. The association technique is used in market basket
analysis to identify a set of products that customers frequently purchase together. This technique is being
used by retailers to research customer’s buying habits.
2. Classification:Classification is a classic data mining technique that is based on machine learning and is
used to classify each item in a set of data into one of a predefined set of classes or groups. Classification
method makes use of mathematical techniques such as decision trees, linear programming, neural network
and statistics. In classification, a software is developedthat can learn how to classify the data items into
groups. For instance, we can apply classification in the application that “given all records of employees
who left the company, predict who will probably leave the company in a future period.” In this case, the
records of employees can be divided into two groups named “leave” and “stay”.
3. Clustering:Clustering is a data mining technique that makes a meaningful or useful cluster of objects
which have similar characteristics using the automatic technique. The clustering technique defines the
classes and puts objects in each class whereas in the classification techniques objects are assigned into
predefined classes. For instance, in a library, there is a wide range of books on various topics available.
By using the clustering technique, the books that have some kinds of similarities can be kept in one
cluster or one shelf and can be labelled with a meaningful name.
4. Prediction:Prediction is one of a data mining techniques that discover the relationship between
independent variables and relationship between dependent and independent variables. For example, the
prediction analysis technique can be used in the sale to predict profit for the future.Ifsale is an
independent variable, profit is considered to be a dependent variable and then based on the historical sale
and profit data, the managers can draw a fitted regression curve that is used for profit prediction.
5. Sequential Patterns:Sequential patterns analysis is one of data mining techniques that seeks to
discover or identify similar patterns, regular events or trends in transaction data over a business period.
With historical transaction data in sales, businesses can identify a set of items that customers buy together
different times in a year. This information can then be used by the organisation to recommend customers
to buy those products with better deals based on their purchasing frequency in the past.
6. Decision Trees:A decision tree is one of the most commonly used data mining techniques because its
model is easy to understand for users. In decision tree technique, the root of the decision tree is a simple
question or condition that has multiple answers and each answer leads to a set of questions or conditions
that help to determine the data and arrive at the final conclusion or decision.

Role of IT
Information technology (IT), the internet, electronic commerce (e-commerce), wireless and mobile
technologies have each had a major impact on salesforce productivity and management. The extent to
which such technology developments have affected salespeople’s jobs can be gauged by the boxed case
history of a national account manager for a major company.
1. Collaborative (CRM): IT provides two important tools for e-CRM i.e. data mining and warehouse
for keeping customer data with the company for selling purpose. Organizations must assemble and
integrate Customer Relationship Management (CRM) systems that enhance customer collaboration
and build customer loyaltyand exit barriers.
2. Sales and marketing through IT: Organizations must strategically outsource sales and marketing
budgets to a new generation of businesses, including marketing agencies, E-commerce utilities and
service providers, and E-channel partners to obtain talent, technical expertise, and cost efficiencies.
3. Customer-centric organizations: Organizations must recast their familiar organizational and
functional models, transforming them into a natural extension of customer segmentation, enterprise
selling processes, and complex demand chain partnerships.
4. Hybrid distribution systems: Organizations must build multi-channel, hybrid distribution systems
that leverage low-cost, high-touch technologies to improve cost efficiency, market coverage, and
overall selling performance.
5. Value-added direct sales: Organizations must migrate the role of direct sales to better align high-
touch, face-to-face selling interactions with high-value and high-margin products and services.
6. Demand chain remediation: Organizations must restructure demand chain relationships to
maximize value creation and customer access while leveraging costs and value-added channel
partnerships.
7. E-care &Customer interaction centers: Organizations must consolidate and integrate call center,
Web, e-mail, fax, and marketing technology assets to better manage selling resources, technology
infrastructure, and customer interactions and adopt enterprise-wide management of the customer care
processes to ensure seamless service.
8. Product channel readiness: Organizations must design modular, "channel-ready" products
optimized for specific sales channels, partners, and customer segments, improving personalization,
ease of doing business, and transaction costs.
9. Changing role of branding: Organizations must aggressively build brand equity in e-channels, in
virtual communities, and across multiple selling partners, channels, and points of interaction (POI).
10. Interactive direct marketing: Organizations must deploy new tools, approaches, and strategies for
anticipating or influencing the way customers buy.Organizations must creatively manage the impact
of buy- and sell-side technologies and trading communities on margins and pricing.
11. Enterprise Resource Planning (ERP):Enterprise resource planning(ERP) is a cross functional
enterprise system driven by an integrated suite of software modules that supports the basic internal
business processes and links it with purchasing and sales of company.
12. Supply Chain Management (SCM):Management Information Systems (MIS)enable companies to
track sales data on daily basis. Sales forecasts are a crucial part of the supply chain. Supply Chain
Management (SCM) was a major tool which was involved as inseparable part of sales of company
with addition of computers in sales management. It is an important part of enterprise performance
management (EPM).

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