Preface

This report on Impact of Advertising is prepared in fulfillment of presentation in the International Marketing subject. We present this report to Prof. Gayatri Bhoir who has helped us in understanding this subject through a practical approach. She has guided us through the preparation of this project and for this we are grateful to her. We have prepared this report after a thorough research and analysis of the topic. We would like to thank all those who helped us make this project report worthwhile
GROUP MEMBERS

1 2 3 4 5 6

Ibhrahim Khan 125 Devashree Korlekar 126 Prabhawati Kuckian 127 Siddhraj Masali 128 Shailesh Maurya 129 Abhishek Mishra 130

INDEX Sr No No. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Topic

Pg.

International Marketing: A global marketplace Advertising and its milestones Advertising plan Consumer and Market analysis Marketing Plan Advertising communication system Media strategy & tactics International Advertising concept Brand ambassadors Impact of advertising on sales: Hero Honda Agencies Fact file Advertising expenditure Top 10 advertising companies Factors affecting advertising

4 5 7 8 9 10 11 12 14 18 19 20 21 22 23

International Marketing: A Global Marketplace

Trade is increasingly global in scope today. There are several reasons for this. One significant reason is technologicalbecause of improved transportation and

communication opportunities today, trade is now more practical. Thus, consumers and businesses now have access to the very best products from many different countries. Increasingly rapid technology lifecycles also increases the competition among countries as to who can produce the newest in technology. In part to accommodate these realities, countries in the last several decades have taken increasing steps to promote global trade through agreements such as the General Treaty on Trade and Tariffs, and trade organizations such as the World Trade Organization (WTO), North American Free Trade Agreement (NAFTA), and the European Union (EU). Some forces in international trade. Trade between countries is beneficial because these countries differ in their relative economic strengthssome have more advanced technology and some have lower costs. Products tend to be adopted more quickly in the United States and Japan, for example, so once the demand for a product (say, VCRs) is in the decline in these markets, an increasing market potential might exist in other countries (e.g., Europe and the rest of Asia). Internalization/transaction costs refers to the fact that developing certain very large scale projects, such as an automobile intended for the World market, may entail such large costs that these must be spread over several countries.

Advertising
Advertising is a persuasive communication attempt to change or reinforce ones prior attitude that is predictable of future behavior. Historical Milestones In Advertising Advertising goes back to the very beginnings of recorded history. Archaeologists working in the countries around the Mediterranean sea have dug up signs announcing various events and offers. An early form of advertising was the town crier. Another early advertising form was the mark that trades people placed on their goods, such as pottery. As the persons reputation spread by word of mouth, buyers began to look for

his special mark, just as trademarks and brand names are used today. As production became more centralized and markets became more distant, the mark became more important. The turning point in the history of advertising came in he year 1450 when Johann Gutenberg invented the printing press. Advertising no longer had to produce extra copies of a sign by hand. The first printed advertisement in the English language appeared in 1478. In 1622, advertising got a big boost with the launching of the first English newspaper, The Weekly News. Advertising had its greatest growth in the United States. Ben Franklin has been called the father of American advertising because his Gazette, first published in 1729,had the largest circulation and advertising volume of any paper in colonial America. The invention of radio and, later, television created two more amazing media for the spread of advertising.
Advertising's Two Important Virtues

You have complete control. Unlike public relations efforts, you

determine exactly where, when and how often your message will appear, how it will look, and what it will say. You can target your audience more readily and aim at very specific geographic areas. You can be consistent, presenting your company's image and sales message repeatedly to build awareness and trust. A distinctive identity will eventually become clearly associated with your company, like McDonald's golden arches. Customers will recognize you quickly and easily - in ads, mailers, packaging or signs - if you present yourself consistently. What Advertising Can Do For Your Business Remind customers and prospects about the benefits of your product or service Establish and maintain your distinct identity Enhance your reputation Encourage existing customers to buy more of what you sell Attract new customers and replace lost ones Slowly build sales to boost your bottom line Promote business to customers, investors

Advertising Plan

The manager needs to engage in situation analysis with respect to the market conditions that are operating at the time and to assess the consumer/market, competitive, facilitating agency, and social legal, and global factors that will affect decision making and the development of the plan. It is vital that the advertising plan be developed so as to mesh with and support the various components of the marketing and communications mix such as personal selling, pricing, public relation, and promotion. The advertising manager also needs to know the major areas of his or her planning and decision-making responsibilities.

There are three areas of major importance:

Objective And Target Selection, Consideration, Message Strategy And Tactics, Media Strategy And Tactics.

Consumer and Market Analysis

A situation analysis often begins by looking at the aggregate market for the product, service, or cause being advertised: the size of the market, its growth rate, seasonality, geographical distribution; the possible existence of different segments; and trends in all of these aggregate market characteristics. Competitive Analysis Advertising planning and decision-making are heavily affected by competition and the competitive situation the advertiser faces. Competition is such a pervasive factor that it will occur as a consideration in all phases of the advertising planning and decision-making process. A type of market structure analysis that involves the

development of perceptual maps of a market, for example, attempts to locate the relative perceptual positions of competitive brands. Situation analysis should usually include an analysis of what current share the brand now has, what shares its competitors have, trends in these shares, reasons for these trends, what share of a market is possible for the brand, and from which competitors an increase in share will come. The planner also has to be aware of the relative strengths and weaknesses financial, production, and marketing of the different competing companies, and the history of competitive moves and objectives in the product category.
The Marketing Plan

Advertising planning and decision making take place in the context of an overall marketing plan. The marketing plan includes planning, implementation, and control functions for the total corporation or a particular decision-making unit or product line. The marketing plan will include a statement of marketing objectives and will spell out particular strategies and tactics to reach those objectives. The marketing objectives should identify the segments to be served by the organization and how it is going to serve them. The needs and wants of consumers on which the firm will concentrate, such as the needs of working men and women for easily prepared meals, are identified and analyzed in a marketing plan. There are several marketing tools that can be used to help an organization achieve its marketing objectives. Most people are familiar with the 4 Ps the marketing mix which includes product, price, place, and promotion. A marketing plan formulates the strategy and tactics for each of these.

Advertising Communication System

Advertising communication always involves a perception process and four of the elements shown in the model: the source, a message, a communication channel, and a receiver. In addition, the receiver will sometimes become a source of information by

talking to friends or associates. This type of communication is termed word-of-mouth communication, and it involves social interactions between two or more people and the important ideas of group influence and the diffusion of information. An advertising message can have a variety of effects upon the receiver. It can

Create awareness Communicate information about attributes and benefits Develop or change an image or personality Associate a brand with feelings and emotions Create group norms Precipitate behavior

Message Strategy and Tactics

The actual development of an advertising campaign involves several distinct steps. First, the advertising manager must decide what the advertising is meant to communicate by way of benefits, feeling, brand personality, or action content. Once the content of the campaign has been decided, decisions must be made on the best and most effective ways to communicate that content. Media Strategy Although there are many rules of thumb often used to decide how much money to spend on advertising, the soundest rules involve beginning with a detailed specification of what a corporation is attempting to accomplish with advertising, and the resources necessary. It is only when the job to be done is well specified that the amount and nature of the effort the amount of money to be invested in advertising can be really determined

International advertising

It entails dissemination of a commercial message to target audiences in more than one country. Target audiences differ from country to country in terms of how they perceive or interpret symbols or stimuli, respond to humor or emotional appeals, as well as in levels of literacy and languages spoken. How the advertising function is organized also varies. International advertising can, therefore, be viewed as a communication process that takes place in multiple cultures that differ in terms of values, communication styles, and consumption patterns. International advertising is also a business activity involving advertisers and the advertising agencies that create ads and buy media in different countries. The sum total of these activities constitutes a worldwide industry that is growing in importance. International advertising is also a major force that both reflects social values, and propagates certain values worldwide. The Communication Process The process of communication in international markets involves a number of steps. First, the advertiser determines the appropriate message for the target audience. Next, the message is encoded so that it will be clearly understood in different cultural contexts. The message is then sent through media channels to the audience who then decodes and reacts to the message. At each stage in the process, cultural barriers may hamper effective transmission of the message and result in miscommunication.

International Advertising as a Business Practice

International advertising can also be viewed as a business activity through which a firm attempts to inform target audiences in multiple countries about itself and its product or service offerings. In some cases the advertising message relates to the firm and its activities, i.e. its corporate image. In other cases, the message relates to a specific product or service marketed by the firm. In either case, the firm will

use the services of an advertising agency to determine the appropriate message, advertising copy and make the media placement
Brand Ambassadors: their effect on International Marketing and advertising

Soft drinks, chocolates, biscuits, paints, cars, tyres, scooters, suiting, footwear, watches, pens, hair oil, insurance packages, diamonds, photo films ... The list could goes on. It appears that, of late, corporate India does not want to sell anything to the consumer without using either a movie star or a sports hero This in itself is an important advertising strategy for majority of the companies. So, when Cadbury India wanted to restore the consumer's confidence in its chocolate brands following the high-pitch worms controversy, the company appointed Amitabh Bachchan for the job. Last year, when the even more controversial pesticide issue shook up Coca-Cola and PepsiCo and resulted in much negative press, both soft drink majors put out high-profile damage control ad films featuring their best and most expensive celebrities.
.

While Aamir Khan led the Coke fightback as an ingenious and fastidious Bengali who finally gets convinced of the product's `purity,' PepsiCo brought Shah Rukh Khan and Sachin Tendulkar together once again in a television commercial which drew references to the `safety' of the product indirectly. The success that the Aamir Khan commercial brought Coca-Cola is universally acknowledged. A creation of Prasoon Joshi, National Creative Director, McCann-Erickson, and the ad has been exported to foreign markets as well. Thus it proved beneficial for international marketing of the product.
The Tata Group has some of India's most famous personalities from the sports and entertainment fields endorsing its products and services, and the

Tata brand like Narain Karthikeyan, Sourav Ganguly and Irfan Pathan, Sania Mirza, Naseeruddin Shah and Aamir Khan who have greatly contributed to the success if Tatas products and services.

Highest Earning Celebrities

1. Amitabh Bachchan 2. Sachin Tendulkar 3. Narain Karthikeyan 4. Shahrukh Khan 5. Aamir Khan 6. Aishwarya Rai 7. Rahul Dravid 9. Saurav Ganguly 10.Sania Mirza 8. Saif Ali Khan

Impact Of Advertising On Sales

HERO HONDA

Sales Performance Dec'04 Dec'05 Apr'04- Dec'04 Apr'05-Dec'05 Domestic 225250 238822 1892540 2155479 Exports 5501 6282 43441 72815 The Hero Honda Company achieved a solid growth of 35% as compared with sales recorded during January 2005.

The cumulative sales of the company for the period April 2003 - January 2004 are 16,73,421 motorcycles, a notable jump from 14,27,052 units sales achieved during the corresponding period last year (April 2002-January 2005). This reflects a growth of 17% in the cumulative sales of the company owing to its advertising strategies.

Top 10 Advertising companies. Rank Company Total U.S Advertising Advertisin (Millions $) Recent Of Sales

Total U.S Sales (Millions $) As A

1 Philip Morris 9.9% 2 Procter & Gamble 12.8 3 General Motors 1.4 4 Sears 2.1 5 RJR Nabisco 6.4 6 Grand Metropolitan 24.1

2,058 1.507 1,294 1,045 815 774

20,866 11,805 91,260 50,251 12,635 3,211

7 7.3 8 6.4 9 6.7 10 24.7

Eastman Kodak McDonalds Pepsi Co Kellogg

736 728 712 683

10,024 11,380 10,551 2,766

Objective:

Change what people expect of the brand from performance and winning to possibility and creative self-expression Target Audience:

Young people -- open, ready and willing to have fun

Active-minded 16 - 22 year olds during summer vacation How Magazines Were Used:

Speaking to the target, drawing them in with rich, inspiring copy Results:

Product sell through strong; basketball was prime success story complete sell through at urban and athletic specialty retailers

Positive feedback from retailers and consumer

Milestones 1954 Sunsilk first launched in the UK. 1955 First advertisement of Sunsilk appeared on TV. 1964 Launch of Sunsilk hair spray. 1968 Sunsilk shampoo re-packaged in PVC bottles. 1971 Launch of Sunsilk conditioner. 1975 Sunsilk became the biggest name in hair care.y 200 Sunsilk glossy magazine launched in Argentina.008 Social networking site Gang of Girls was introduced in India. First advertising Sunsilk began advertising in 1955 with acampaignthat focused on specific hair "issues". In theUK , the campaign focused on shiny hair. During the 1960s, a television commercial of Sunsilk featured a tune composed byJohn Barry, The girl with the sun in her hair, which proved sopopular that it was subsequently released as a pop single.Sunsilk radiocommercials were aired in 1969 featuringDerek Nimmoto support the newSunsilk Herb shampoo for problem hair called Hairy Tales. In the early 1970s, Sunsilk wasadvertised with the slogan All you need is Sunsilk