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Product Management
Theory
Objectives
• To understand the importance of product decisions in the overall business strategy
• Strategies at every stage of PLC
• Do Indian Products have a longer growth phase
Product
• An ordinary cracker vs Standard
• McDonalds Mini-meals - Combination of benefits – graphics, logo and the overall packaging well marketed
Classifying consumer products
• Tangibility - Goods vs Services– Goods - Durability – Durables vs consumables
– Better call products rather than service or goods
• Consumer buying behaviour – – Melvin Copeland – 1924, for consumer products and generalised
– Convenience products
– Shopping products
– Speciality products
– Unsought products
Convenience products
• relatively inexpensive, purchased regularly and repeatedly, impulse purchase, minimum shopping effort
• Distribution is key• No effort from retailers for substitution• Heavily advertised• Staples, impulse and emergency• Milk, match-box,petrol, M-Seal
Shopping products
• Products are compared, additional information is sought, merchandise studied, reassurance sought on quality, style, or value
• Buyers see a benefit of shopping• High involvement buying behaviour
– Homogenous – evaluation only on price• Basmati, underwear, washing machines, crackers
– Heterogenous – identifiable product differences• Higher social and monetary risk• Driven by “fashion”• Willing to shop for quality, brand names or style• Insist on store –I bought this suit at Shoppers Stop
Speciality products• Product quality extremely important• Customers know what they want and what they are
getting into• Select brand in advance and are not looking for
alternatives• High brand insistence• Exclusive distribution• Advertising to build brand values, its uniqueness and
the value attached• Stereo, Piano, cars
Unsought products
• Customers don’t want are are not aware– New unsought goods –
• Need reach and awareness measures• Amul Kool, Railway internet bookings
– Regularly unsought – • Personal selling is key• Insurance, encyclopedias• Blood donation• Funerals/Gravestones
Business/Industrial products
• Derived demand
• Price inelastic
• Tax treatment is key
Business product classification
• Installations
• Accessory
• Raw materials
• Components
• Supplies
• Professional services
Goods vs Services
• Goods – Durable or non-durable
• Services – intangible
• Goods-services is a continuum - automobiles
Good Good/Service Service
Product
• A bundle of benefits(customers buy satisfaction, not parts)
• Has many aspects – tangibility, consumer driven and benefit designed.Hence, we need to look at
• Total Product – “the broad spectrum of tangible and intangible benefits that a buyer might gain after purchase”
• 1/4” Drill bit, LIC, Apna Bazaar• Hood ornaments in automobiles – sculptures of
women, animals or air-planes – now obsolete, dead and ugly – dumped for a smoother look
Total Product concept
Colour
Brandname
Packsging
Quality
Instruction Manual
Attributes
Styling
Core Product
Payment Options
ReplacementOr
Repairs
Installation(For bulky Products)
Delivery Points& Systems
After Sales Service
Guarantees&
Warranties
CustomerEducaon &
Training
CustomerComplaint
Management
Theodoore Levitt
Core Product
Formal Product
AugmentedProduct
Future Product
Total Product concept
Colour
Brandname
Tyres
A/c
Mileage
Engine displacementVolume(CC)
Styling
VehicleMaXx
Payment Options
ReplacementOr
Repairs
CRM
Delivery Points& Systems
After Sales Service
Guarantees&
Warranties
CustomerEducaon &
Training
CustomerComplaint
Management
Theodoore Levitt
Core Product
Formal Product
AugmentedProduct
Future Product
Product strategy and Product (positioning) Concept
• Product strategy– The planning and primary(core) and auxiliary(formal,
augmented and future) dimensions of a product
• Product concept– The end result of the marketing strategists selection and
blending of the product’s multilevel dimensions into a basic idea emphasizing a particular set of consumer benefits
– It is the essence or the core idea for positioning– It is the reason for buying
Rasna
• Product strategy– Convenient, economical refreshing
concentrates which are easy to use by housewives into a soft, ready to serve drink
• Product concept– Healthy alternative to carbonated drinks
Product Mix
• Product Lines– Different products that are relatively close to
each others, satisfy a particular class of needs, or are used together, or are bought by a set of customer groups or are distributed through the same channels
• Product Items– One particular version of a good or a service
• Variants
Product Line
• ITC• Tobacco Products- Wills, Bristol, India Kings, Clasic• Hotels - Welcomgroup• Consumer Products – Sunfeast, Sundrop• Exports – Agro-products• Apparels - WLS
• Sub-optimal product mix indicators:• Excess capacity• High proportion of profit from small percentage of products• Insufficient use of sales staff• Steadily declining sales/profits
Depth of a product line
• Number of different product items offered in a product line
• Haldiram, Bedekar
• Inventory management critical
• Need to ensure marginal additions are justified
Width of a product line
• Extent of the product lines
• P&G
• Needs a large pool of resources and experience
• Global companies have an edge as they save on product development and learnings
Product Mix decisions
• Product line addition/deletion
• Product Abandonment
• Product Modification
Product Line addition• Upward/downward• Done due to structural changes in marketplace –
like customer lifestyles and demographic changes like increased disposable income, media explosion, competition, better marketing capabilities, exploit brand image in other class of products
• Fashion, Entertainment, automobiles and Mobile phones
Tommy Hilfiger
• ARVIND Murjani Brands Pvt Ltd (AMB), a joint venture between Murjani Group and Lalbhai Group has entered into a licensing agreement for marketing and distribution of Tommy Hilfiger mens' sportswear, mens' jeanswear and juniors' jeanswear collections in freestanding speciality stores apparel in India in spring 2004
Product abandonment
• Excessive management time, low demand, uneconomical, low contribution, outdated
• North Star, FUS, Avis, Action, Killer, UFO
• Bajaj Legend, Cielo
Product Modification
• Changing tastes
• Tangible/intangible
• Reformulation, redesigning, changing unit sizes, adding or removing features
• Numero Uno, Levi’s Dangerously Low, Old look, Wild leg flares and boot cuts
Tools
• BCG
• GE
• PLC
• PIMS
Defining corporate mission•To share with managers, employees and customers.
•A well worked mission statement provides employees with a sense of purpose, direction and opportunity
•Good mission statements
- focus on limited goals
- stress the major policies and values the company wants to honor
Mission Statement - components
• The mission statement communicates the firm's core ideology and visionary goals, generally consisting of the following three components:
• Core values to which the firm is committed • Core purpose of the firm • Visionary goals the firm will pursue to fulfill its
mission
Burger King
CUSTOMER PROMISE
BURGER KING is flame broiled burgers,
fries and soft drinks at a good value served quickly and consistently by
friendly people in clean surroundings.
Indian Oil Corporation
• “To excel in petroleum refining and marketing” - Indian Oil Corporation.
Establishing Strategic business units
•Define the business as a customer satisfying process – Levi’s sells American attraction
•SBU has 3 characteristics -
- it is a separately planned business unit
- own set of competitors
- it has a manager responsible for strategic planning and profit performance
Boston Consulting Group’s (BCG) Growth-Share Matrix
20%-18%-16%-14%-12%-10%- 8%- 6%- 4%- 2%- 0M
arke
t G
row
th R
ate
10x 4x 2x 1.5x 1x Relative Market Share
.5x .4x .3x .2x .1x
Dogs 87
3 ?Question marks
? ?2
1
Cash cows
6
Stars
5
4
Strategies
• Build – Question Marks• Hold – Stars and Strong cash cows• Harvest – Weak cash cows, dogs and
question marks – reduce costs(R&D, new staff/replacement staff, advertising) faster than drop in Sales
• Divest – Sell or liquidate the business – dogs and question marks-drags
GE/ Mckinsey Matrix
• The GE matrix generalizes the axes as "Industry Attractiveness" and "Business Unit Strength" whereas the BCG matrix uses the market growth rate as a proxy for industry attractiveness and relative market share as a proxy for the strength of the business unit.
• The GE matrix has nine cells vs. four cells in the BCG matrix.
GE/ Mckinsey Matrix
Strategy Formulation
• Firms that do not produce clear strategies do not perform well.
Planning new businessesAnsoff matrix
• Intensive Growth Strategies • strategy notes\Ansoff Matrix.htm
CURRENT
PRODUCTSNEW PRODUCTS
CURRENT
MARKETSMARKET
PENETRATIONPRODUCT
DEVELOPMENT
NEW MARKETS
MARKET
DEVELOPMENT
DIVERSIFICATION
Strategies
• Market Penetration - the firm seeks to achieve growth with existing products in their current market segments, aiming to increase its market share.
• Market Development - the firm seeks growth by targeting existing products to new geographical markets or segments.
• Product Development - the firms develops new products targeted to its existing market segments.
• Diversification - the firm grows by diversifying into new businesses by developing new products for new markets
Adoption and Diffusion: The Product Life Cycle (PLC)
Sales and Profits ($)
Time
Sales
Profit
Intro Growth Maturity Decline
Can brand namebe used to extract good will before this?
Marketing During a Product’s Life
Maintain LoyaltyMaintain LoyaltyMarketing Objective
Marketing Objective Gain AwarenessGain Awareness DifferentiateDifferentiate HarvestHarvest
CompetitionCompetition NoneNone GrowingGrowing ManyMany ReducedReduced
ProductProduct OneOne More VersionsMore Versions Full lineFull line Best sellersBest sellers
PromotionPromotion Inform/EducateInform/Educate Stress competitive differences
Stress competitive differences ReminderReminder MinimalMinimal
DistributionDistribution LimitedLimited More outletsMore outlets Many OutletsMany Outlets Few OutletsFew Outlets
Stage of the product life cycleS
ales
rev
enue
or p
rofi
tIntroduction Growth Maturity Decline
+0–
Total industrysales revenue
Total industry profit
Innovators:Venturesome, higher educated, use multiple information sources
Innovators:Venturesome, higher educated, use multiple information sources
Early majority:Deliberate, many informal social contacts
Early majority:Deliberate, many informal social contacts
Early adopters: Respectable, Leaders in social setting, slightly above average education
Early adopters: Respectable, Leaders in social setting, slightly above average education
Late majority: Skeptical, below average social status
Late majority: Skeptical, below average social status
Laggards: Traditional, fear of debt, neighbors and friends are information sources
Laggards: Traditional, fear of debt, neighbors and friends are information sources
Time
Innovators2.5%
Early adopters13.5%
Early majority
34%
Late majority
34%
Laggards16%
The Diffusion Process
BrandingBy
Prof. Mangesh Borse
Christian Mikunda
Brand
• Haywards, Miller Lite, Kingfisher, Fosters
• Ancient rulers did it to identify the culprit if anything went wrong
• Forced to identify their brands with their names, the manufacturers started taking greater pride in the products and made them better than others
Brand
• Products + a bundle of emotions
Brand
• Branding serves both the sellers and the buyers
• A brand is a name, term, symbol, sign, design or unifying combinations of these
• A brand name is the verbal part of the brand• Brand mark is a unique symbol• A distinctive way of writing a brand name
is the logo
What is a brand?
• A brand is a name, term, sign, symbol or design or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors(American Management Association)
What is a Brand?
• Claim of distinction
• Set of core values
• Communicates what business is about
• Sets a company apart
What a Brand is Not
• Not only a color scheme, logo or slogan– These are tactics
• Tactics do not state what is unique about the company
• Windows
Brand Marks
Brand Identity
Name
House Colours
Baseline
Design
Mark(logo)
Event Branding
Service branding
Rights ..
• The seller has extensive rights till perpetuity
• (Patents and copyrights have periods)
Brand meanings
• Attributes: Mercedes suggests expensive, well engineered, well built, durable, high prestige cars
• Benefits: Functional and Emotional benefits– Tata- reliable– Kamasutra-
• Values: Producer’s values: – McDonalds -hygiene
Brand meanings
• Culture: Birla-conventional, Reliance- aggression, HLL- professionalism
• Personality: HLL
MTNL• User:
– Pepsi vs Coke– Barista vs Udipi
Brand equity
• Value: • Morepen Laboratories the brand name 'Burnol' from Reckitt
Piramal Ltd for 8.6 cr• Crocin was taken over by SKB from Duphar for 75 cr
• The real value of the brand
• “My acid test . . . Is whether a housewife, intending to buy Heinz tomato ketchup in a store, finding it to be out of stock, will walk out of the store to buy it elsewhere” – Tony O’Reilly, CEO Heinz
Brand Equity
• The value of the brand• Burnol, Crocin, Clearasil, Hamam, Thums Up
equities• A strong brand is an asset –
– Strong entry barrier
– Represents the high proportion of customers who love the brand
– Competition needs huge spends to create another one- media, distribution, sales force, advertising
Brand equity- six levels
1. Customer will change brands for price. No loyalty2. Customer is satisfied. No reason to change3. Customer is satisfied and would incur costs by
changing brands4. Customer values brand and sees it as a friend5. Customer is devoted to brand
• Brand Equity is related to 3,4 and 5 + brand name recognition, perceived quality of brand, strong mental and emotional associations etc
Brand Name Decisions
• Suggest product benefits – Fair and Lovely
• Suggest product qualities - Bullet
• Easy to pronounce, recognise and remember – Shoppers’ Stop
• Distinctive - Karate
• Should not carry negatives - Satkar
Packaging
• Designing and producing the container for a product
• Labels– Salience– Imagery– Stand out in clutter– Mnemonic– Legally correct
Brand Development, Problems & Opportunities
Regular Advertising Tactics
• Looks at customers to find need– Ex. Customer wants low prices
• Tries to meet need– Lowers price of product
• Competition is doing same thing– Have price war
• Creates brand parity• Without value, price is only measure of value
Brand Development Differs
• Look closely at the company and find core distinction
• What promises can be delivered– Unique Selling Proposition (USP)
• This value separates from competition– Creates brand equity
Brand Exercise
• McDonalds
• Pepsi
• Mahindra
• American Express
Brand Example #1: Maytag
• Doesn’t compete on price
• “Quality” promise – Machines don’t break down– World’s loneliest repairman
• “Value” translates to other products– Ex. Toaster
Brand Example #2: L'Oreal
• Doesn’t compete on price
• Doesn’t compare
• Positions itself in the consumers mind – Because I’m Worth It
• Provides value that is unique
Problems & Opportunities
• Fire Fighting Companies– Should focus on strategic prevention
• Problem– Any barrier or situation that makes it difficult
to achieve an objective
• Opportunity– Situation or circumstance that can potentially
give the company a marketing advantage
Problems
• Related to sales or market share
• Not easy to change– Product line, price or distribution
• Adjust promotion (or communication)
• Is it persuasive?
• Is the consumer aware?
• Are the media channels the most effective?
Opportunities
• Good companies turn problems into opportunities
• Many things must happen to make change
Problem/Opportunity Examples
• Arm & Hammer– P: Cooking use limits potential– O: Developed new uses (freshens refrigerator
and freezer)
• Miller Lite beer– P: Male drinkers see low-calorie as sissy beer– O: Associate product with very masculine men
Problem/Opportunity Examples
• McDonalds– P: Indian snacking habits - rigid– O: Developed new indianised menu
• Miller Lite beer– P: Male drinkers see low-calorie as sissy beer– O: Associate product with very masculine men
Problem/Opportunity Examples
• A-1 Steak Sauce– P: Use of A-1 is sporadic (forgot to use it)– O: Place the word refrigerate on the bottle
• Colgate– P: Poor usage per occassion– O: increase nozzle
Problem/Opportunity Examples
• Must anticipate response of competition
• Hunts ketchup– P: Pours slowly– O: Made a bottle with a bigger opening
• Heinz ketchup– P: Pours slowly– O: Associate slow pouring with richness
Opportunities
• Good companies turn problems into opportunities
• Many things must happen to make change– External Factors: Political, legal, cultural,
social• Indian cricket team back in Pakistan
– Internal Factors: finance, production, marketing
Financial Resources
• Must have sufficient capital to– Initiate action and sustain activity
• Pizza Example– Low overhead with dine-in only
– Expand overhead if include home delivery
– Home delivery needs speed
– To speed up baking need Rs 25L conveyor oven
– To get decent return must draw more business
Production Resources
• Thinking up new product concept or service is easy
• Producing it is more difficult– Saffire zi
• Must have sufficient resources to produce– Quality product– Competitive price
• Need management expertise, technological competence and right physical facilities
Marketing Resources
• Must have marketing-savvy people in decision making positions
• Tata Indicom– Good production resources to make cellphones,
but– Tata’s could not drive demand
• Reliance India Mobile– Focused on marketing, and trials
Prepaid super duper
Marketing Resources
• Ford Motor Co.– Good production resources to sell cars, but– Henry Ford only sold black automobiles
• General Motors– Focused on marketing
Opportunities: Four Ways to Increase Sales
• Retain Current Users– Competition tries to lure away– Cost of new acquisition is 5 times cost of
retaining
• Getting Current Users to Use More– Give them reason to use the product more– NECC: Sunday ho ya Monday, roz khao ande
Opportunities: Four Ways to Increase Sales
• Find New Uses for a Product– Find new, slightly different ways– Nylon
• Find New Users– Look where you and the competition have been
successful– Look in new places
• Demographic and psychographic profiles– Computers in school
IMC
• Introduction to IMC• how it differs from previous marketing
communications practice• benefits and barriers• implications for agencies and clients of
using IMC
What’s different about IMC?
• For decades, marketers used the different communications methods to achieve different objectives
• they were managed separately
• now, marketing thinking suggests that these methods should be co-ordinated
Why do IMC?
• To increase communications effectiveness and consistency
• to promote synergy.
• But no common consensus on what IMC
Benefits of IMC
• Promotes customer focus
• leads to a recognition of all audiences
• means clear objectives are set
• encourages consideration of full range of media vehicles
• and use of communication methods
Why IMC now?
• Certain factors have encouraged the adoption of IMC by agencies:
• communications mix
• specialist new agencies
• growth in media planners/buyers
• client awareness
• international communications
Why IMC now? Cont’d
• relationship marketing
• technological advances
• growing recognition of the benefits of IMC
Barriers to IMC
• Reluctance of industry to change
• messy
• organisational structure
• budgeting
• remuneration for agencies
• internal and external factors
Example of IMC
• how advertising featuring a simple idea was extended to all media
• uses advertising objectives, target market research, and evaluation to present a convincing argument for the power of IMC
ICICI launch
• TVC
• Mailers
• Youth magazines
• Crossings
• Internet
• “Outdoor”
Campaign performance
• Established ICICI Prudential as a reliable brand
• Initial trials were very good
• But the IMC worked
• Today, ICICI Prudential is the leading Private Insurance provider
ADVERTISING
Type of Advertising
Target Audience
Creative Strategy
Media Strategy
Advertising
Paid form of non-personal persuasive communicationwith set objectives
Different for PR, CRM, Sales Promotions
Advertising ProcessMarketing Strategy
Advertising StrategyObjective settingBudgetingMessage StrategyMedia Strategy
Strategy Implementation
Assessing Advertising Effects
The Target Market Decision
• 3 Basic Target Market Decisions– Undifferentiated Market
• Use broad, dramatic creative appeals to be effective• Tata Namak
– Differentiated market• Divided market into sections (primary, secondary and
tertiary)• Identify target audience and refer to target groups or• Call everything the target market audience • ITC Bristol, Wills, Classic, India Kings
The Target Market Decision
• 3 Basic Target Market Decisions (cont’d)– Concentrated Market or Market Niche
• Target smaller segment in overall market
• Doesn’t compete against market share leader in all segments
• Problem occurs when leader develops niche product
– Example: Krack, Smile, Itch-guard
Defining the Target Market
• Demographic variables• Psychographic Variables (lifestyle)• Product Usage (heavy, medium, light)• Brand loyalty• Benefit segmentation• Consumers’:
– Needs Wants Interests
– Problems Motivations
Objective SettingCorporate Communications Objectives
to enhance organisational effectiveness to generate greater profits to improve competitive position Eg “To achieve excellence in petroleum refining and marketing”
– Indian Oil
Marketing Communications Objectives
Possible specific objectives (quantitative) to increase sales from Y to X to raise the level of awareness to generate ‘n’ responses / enquiries Possible sub-objectives (qualitative) to convey information to create desire to improve the image of product X or brand Y to mitigate the effect of premium price
TYPES OF ADVERTISING
Institutional Advertising Promotes an organization and its image & reputation
Product Advertising Promotes specific products
Business to Business Advertising Target is other businesses
ADVERTISING AGENCIES
Much of the Work Is Done by Few “Super-Agencies”, e.g. WPP – JWT, ONM, MINDSHARE, BATES, EQUUS INTERPUBLIC – LOWE, ENTERPRISE NEXUS, INITIATIVE MEDIA, QUADRANT MUDRA
Full-Service Vs. Specialized: MINDSHARE, DIREM, RURAL RELATIONS, SAMPARK, OGILVY LANDSCAPES, ANUGRAH
Often Work on Commission - (% of media time) Fees, Contracts
THE ADVERTISING AGENCY
Account Management
Manages relationship with the client
Creative Services
Artists, copywriters, Art Director
Research and Marketing Services
Research competition, target segment; test ads
Media Planner - Selects media strategy
Account Planner - Makes sure ad fits segment
Process of advertising
Brief Strategy/Insights Creative
Media
FinancialsCollectionMonitor
Research
The triangle of delight
Creative
Media Client Service
Advertising
Why psychology
• The real reasons for brand buying are never rational
• As more and more products become me-too, USP’s are replaced by ESP’s
Maslow’s hierarchy of consumer needs
• Self actualisation - fulfillment, do what you can do best/ do what you want to do
• Esteem - self-respect, reputation, prestige and status
• Belongingness - affection, peer acceptance• Safety - security, order, protection and
family• Physiological - food, clothing. shelter
Motive - Reason to Buy
• “an inner urge that moves and prompts a person to action”
• Primary - food, drink, sex, comfort, freedom from fear, superiority, social approval and longevity- fundamental drives commonly experienced
• Secondary - Bargains, information, cleanliness, efficiency, convenience, dependability, convenience, style, beauty - through experience and exposure
Motivators
• Health• Security• Prosperity• Approval• Attraction• Comfort• Sensuous
• Pleasure• Egotism• Curiosity• Family bonding• IQ stimulation/growth• Fear• Hero worship
Consumer Purchase Behaviour Models
• AIDA - Attention - Interest - Desire - Action• DAGMAR – Defined Advertising Goals for
Measured Advertising Results - Non awareness - awareness - comprehension - conviction - motivation
• Hierarchy of effects model - Unawareness - awareness - knowledge - liking - preference - conviction - purchase
• Stimulus Response Model
Stimulus Response Model
Black Box
Situational including competitive circumstances
Perceptions
Influences
Attitudes
Product Attributes
Corporate attributes
Behaviour
INPUTS
OUTPUTS
THE APPEAL
Hard Sell (Product Centered)
USP - Unique Selling Proposition
One clear reason why the product is better.
Soft Sell (More Indirect)
Looking for an emotional response
Benefit
A“Benefit” is an attribute of the Product (or Service)
which implies or explains how a Customer’s
“NEED” will be fulfilled!
(i.e. how the Product will be of benefit)
Benefit Barrier
A“Benefit barrier” is an psychological belief that
acts as a deterrent to the consumer from believing
in the benefit”
Benefit Barrier
Itch Guard!
Cadbury’s Diary Milk
Onida Televisions
Consumer Insight: Consumer Insight:
An insight
is
An insight
is
A deeply felt human truth that links our lives to our brand
Instant attention«Touched a nerve»«Hit a hot-button»«Struck a chord»
A new angle on old subject
Long term connectionThe brand understands helps me
True and new
+
The effect
it has
Consumer Insight: Consumer Insight:
An insight
is
An insight
is I am a mediocre investor
Instant attention«Touched a nerve»«Hit a hot-button»«Struck a chord»
A new angle on old subject
Long term connectionThe brand understands helps me
The best investments in life are the ones I missed
+
The effect
it has
Insights
• Everyone feels he/she is the best thing that has happened to the world
• Women spare a last look in the mirror• Car drivers look down upon three-wheelers, three wheelers
look down upon 2 wheelers, and so on…• When it comes to a dish, we always check others’ before
touching yours• People communicate strangely in different situations –
train, bus, lift, road
7 BOX ADVERTISING STRATEGY
Target Audience
Current Belief
Desired BeliefCurrent Do
Desired Do
Proposition
Support
ADVERTISING STRATEGY
Mother’sKids
Icecreams/chocolates mess up the teethBrushing is the only dental hygiene habit
Allows them to be happy
AVOID
Shift!
Pepsodent kills germseven hours after brushing
Superior germicheck formula
Brief
Understand the product Manage the information Learnings from research Select the key benefit Excite the creative team
Actal
• Anti-flatulant Antacid
• No wind
Kaminomoto
• Hair vitaliser
• Local laws did not permit following for this category– Logo– Brand promise– Pack shot
Kaminomoto
Surprise always works
tera chehra.exe
Use simple human realities
Advertising Budget
Stage in the PLC Market share and consumer base Competition and clutter Advertising frequency Product substitutability
Creative Strategy
Message Generation Message Evaluation and selection Execution Review
Message Execution
USP vs. ESP Critical for mass brands Style: Slice of life, Lifestyle,
fantasy, mood or image, musical, personality symbol, technical expertise, scientific evidence or testimonials
Research for message generation
Inductive - one-on-ones with dealers, customers, experts and competitors
Deductive - Benefit - rational/sensory/social or ego satisfaction through post usage experience(testimonials), in-use experience(descriptors) or incidental-to-use experience.
ADVERTISING EFFECTIVENESS
Pre-testing Concept testing Copy testing
Post-testing Unaided recall Aided recall Attitude measures
Media steps
Decide on reach, frequency, impact Choosing among media options Selecting the media vehicle Scheduling Deciding on geographical media allocation
Deciding on media - Reach, frequency, impact
Reach: The number of different persons exposed to a particular media at least once during a specified time period
Frequency: The number of times within a specified time period that an average person is exposed to the message
Impact: Qualitative value of an exposure through a given medium
TYPES OF MEDIA
Broadcast Television, Radio
Print Magazines, Newspapers, Directories
Direct and Interactive Direct Mail, Web, E-mail
Specialty Advertising Outdoor/Out-of Home
HOW TO SELECT MEDIA
Promotion Objectives Target Market - Their Habits Funds Available Nature of the Media
Overall Fit With Rest of Marketing Mix
Media Choices
Medium Advantages Limitations
Newspapers Flexibility, topical, short life, small pass-
localised, credible along audience
Television Audio + video, captive immobile, expensive, high
high reach clutter, less selectivity
Radio Mass use, economical less attention, fleeting
Share of adspend by media% Share
TV Press Radio Cinema Outdoor Total
1992 23 63 4 0 10 100
1993 20 67 3 0 10 100
1994 22 69 3 0 6 100
1995 25 66 3 0 6 100
1996 30 61 3 0 6 100
1997 35 54 2 0 9 100
1998 38 46 2 1 13 100
1999 41 43 2 1 13 100
2000 46 46 2 1 6 100
2001 45 44 2 1 8 100
2002 48 43 2 1 6 100
Source: Indian Media Business Vanita Kohli
DECREASE IN % of PROMOTION BUDGET FOR ADVERTISING
Erosion of Brand Loyalty Greater Emphasis on P-O-P Factors Audience Less Concentrated
100 TV channels, 1000s of magazine titles Consumers Have More Power Client Companies Not as Loyal
Switch agencies & put accounts up for review
But, total Ad spend-Rs 10,230 cr in 2002
Selecting the media vehicle
Circulation/ viewership/ listenership Cost per thousand Impact
Hamara Bajaj
Case study
Hamara Bajaj
Fear of Honda Kinetic popularity Strengths from indianness Countrywide appeal
New Hamara Bajaj
No relevance in terms of customer No relevance in terms of products No relevance in terms of environment
But, the core of the thought was Indian The new commercial was focussed on “CHANGING INDIA, UNCHANGING INDIANNESS”
IMC
• Newspapers
• Posters
• Internet Banners
• Ringtones(?)
Mard Mahindra
• Global Leadership
• Multiple Products
• Quality
• Rugged
• Value - Economy
ADVERTISING OBJECTIVES
Introduce New Products Inform and Persuade Build and Reinforce Brand Image Get Immediate Action! Provide Ongoing Contact Help Confirm Decision Help Obtain Distribution Prepare for Personal Selling
New product launch
Headline: Adventure & Luxury.Together, like never before
Subhead: The new Honda CR-V. Combines the thrilling good looks of an SUV with the comfort and smooth drive of a luxury sedan. You've never seen it before and you may never see it again.
Bodycopy: Baseline: The incomparable
Inform and persuade
Headline: A reality calledIndia through the eyes of the city of dreams.
Subhead: Mumbai LiveWith Sreenivasan Jain,11 pm. Weeknights.
Baseline: Experience. Truthfirst.
AGENCY: St.luke's
Build and Reinforce Brand Image
Baseline: UnstoppableAGENCY: Everest
Get Immediate Action!
Headline: Iurance is not about everything going wrong. It's often about things going right.Subhead: -Bodycopy: When things are going right, it is the time you start planning. It may be for your son's higher studies or daughter's wedding. For times like these, it's usually finances that one thinks of first. Flexi Save Plus Endowment Plan from Birla Sun Life Insurance is a flexible insurance plan, which offers you the dual benefit of an insurance cover as well as an investment opportunity, thus helping you grow your savings.Baseline: Your dreams. Our commitment
Provide Ongoing Contact
Headline: Ju deo woh liyo!Subhead: Over the tableBodycopy:
Baseline: The Taste of India
AGENCY: daCunha
Help Confirm Decision
Subhead: Looking at me?Bodycopy: Noticed a VIP lately? You'll find the Elanza in Ravishing Red, Electric Green, Smart Blue and Charcoal Grey. At VIP Lounges, VIP Worlds and leading VIP outlets.Baseline: AGENCY: HTA
Prepare for Personal SellingHeadline: New York LifeSubhead: India. We are here. For life.Bodycopy: Imagine a multi-business corporate, driven by the spirit of enterprise, focused on the knowledge, people, and service-oriented businesses of healthcare, life insurance and information technology.Then, for a moment, imagine one of the world's experts in life insurance. A Fortune 100 company with 156 years of experience in the business and over US $ 138 billion in assets under management.That's MAX NEW YORK LIFE.Together, we wish to provide you with focused, flexible and value-driven service.Why would you do business with us?
For one, we are specialists. Life insurance is all we do. We are flexible and professional when it comes to doing business. Above all, we are transparent and financially responsible.At the heart of our service lie professionally-trained agents with integrity. Call us and experience the difference.We are also a reflection of your real needs. We have a whole host of convenient features such as the free look© option and Personal Insurance Plan©.Additionally, we are available 24 hours a day on our Helpline. All of this, we believe will help us build a great partnership with life in India and indeed the lives of Indians.So, if you wish to experience a whole new way of looking at life insurance, look at us.MAX NEW YORK LIFE. Insurance now gets a fresh new life.Baseline: Your partner for lifeAGENCY: Equus
Help Obtain Distribution
EXECUTION FORMATS
Lecture
Demonstrations- ads\Parker pen Collage.mpeg Problem Solving- ads\VIM BAR Halwai.mpeg Testimonials- ads\Balbir Pasha BAR.mpeg
Drama
“Slice of Life” –ads\Fair & Lovely Cricket 60 Sec.mpeg Storyline – ads\Bajaj Caliber 115 Picnic 60 Sec.mpeg Lifestyle-ads\VIP Luggage 30 sec swing.mpeg Humour- ads\St. Gobin Cafe.mpeg
Execution- Radio
• Humor
• Functionality
• Relevance
• Social Awareness
• Proposition
What do you need to have in you?
Information comfort Knowledge attitude Leadership skills Love people Relationship builder Good presentation skills Personality Thought worker
Future shock
Specialisation will be the order of the day
In medium to long term, successful personnel will shift to consultancy, BPO’s, internet start-ups, or specialised media like DM, Event Management, Rural marketing, TV or Radio
Future shock
They will have an Advertising co-ordinator Large agencies will try to specialise in any
one of these fields Small agencies will be advertising even
smaller brands
Future shock
Businesses will be more vulnerable and will work towards reducing risks
Research will only continue to grow, with the virgin territory of the internet
“If you do enough things poorly, you will go out of business”
Business@The Speed of Thought
Information flow is the lifeblood The internet changes everything Exploit cellular technology Manage knowledge to improve strategic thoughts Bring insights to business operations Expect the unexpected
Art of survival
Resolve Discipline Know more Adapt Pass the baton
with a smile
OGILVY ON ADVERTISING
If each of us hires people who are smaller than we are then we will become a company of dwarfs.
But if each of us hires people who are bigger than we are, we shall become a company of giants.
