PROJECT ON GLOBAL ADVERTISING

Project Report Submitted in partial fulfillment of the requirement for The Award of The Degree of BACHELOR OF MANAGEMENT STUDIES SEM V

UNIVERSITY OF MUMBAI 2011-2012

Submitted by:

Declaration
I hereby declare that I have completed the project on WAREHOSUIN IN THE ACADEMIC YEAR 2011-2012 The information submitted is true and original to the best of my knowledge.

_______________________ Signature of the Student

Certificate

ACKNOWLEDGEMENTS

I owe a lot of people a debt of gratitude for their help with this Project. Its impossible for me to list them in order of importance as all these wonderful people were essential to my project. I thank my project mentor, Prof. Mangal Rawat, for helping me in the completion of the project. Lastly I thank my parents and friends who have generously given me a helping support and guidance for completion of this project.

DESIGN OF THE STUDY

This project is designed to gain knowledge and fact about the industry, which is the actual indicator of the economy of INDIA. The basic purpose to design this project is to give the reader an idea of the sector, about which he can think of while selecting his/her career.

He information given in the project is true and collected from primary as well as secondary sources such as newspaper Business Line, Economic Times, books How to do the correct WAREHOSUING. Annual reports of the companies and from WEB.

Executive Summary

This project is basically designed to have an outlook of the WAREHOSUING BUSINESS as today it has a major contribution in the overall development of the economy. There are many Major players in this Industry located Globally. Most of these Industries players deal globally. In-depth knowledge and some experiences of vintage corporate in this industry is also included in the project.

GLOBAL ADVERTISING

Preface

This report on Impact of Advertising is prepared in fulfillment of presentation in the Global Advertising subject.

We present this report to Prof. Mangal Rawat 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.

INDEX

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

The Oxford University Press defines Global marketing as marketing on a worldwide scale reconciling or taking commercial advantage of global operational differences, similarities and opportunities in order to meet global objectives. -Oxford University Press Glossary of Marketing Terms.

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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.

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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.

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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.

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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

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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.

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Advantages and Disadvantages

Advantages
         

The basic advantage of global advertising is that we can introduce our product globally. Economies of scale in production and distribution Lower marketing costs with respect to the areas covered. Power and scope Consistency in brand image Ability to leverage good ideas quickly and efficiently Uniformity of marketing practices Helps to establish relationships outside of the "political arena" Helps to encourage ancillary industries to be set up to cater for the needs of the global player Benefits of e-Marketing over traditional marketing

Disadvantages
       

Differences in consumer needs, wants, and usage patterns for products Differences in consumer response to marketing mix elements Differences in brand and product development and the competitive environment Differences in the legal environment, some of which may conflict with those of the home market Differences in the institutions available, some of which may call for the creation of entirely new ones (e.g. infrastructure) Differences in administrative procedures Differences in product placement. Differences in the administrative procedures and product placement can occur

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Global Advertising And Brand Management* What could be more fun or challenging than helping create the communications, promotions, commercials and experiences that have come to symbolize the extraordinary service and recognition that is the American Express brand? If youre of a creative or strategic mind and youre intrigued by the opportunity to work on one of the worlds most widely recognized and respected brands, youre on the right page. Considered one of our most powerful assets, the brand has long stood for quality, trust and integrity and consistently appears on Interbrands ranking of the top 100 global brands. As part of Global Advertising and Brand Management, you can use your background and talents to drive innovation, transform customer insights and research into unforgettable solutions, build value, increase sales and create experiences that new and potential American Express customers everywhere will value. A common thread for all employees is a passion for the brand and a passion to put our best foot forward. Marleta, United States

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GLOBAL ADVERTISING: The Overview. Global Advertising as a Communication Process In international markets the process of communicating to a target audience is more complex because communication takes place across multiple contexts, which differ in terms of language, literacy, and other cultural factors. In addition, media differ in their effectiveness in carrying different appeals. A message may, therefore, not get through to the audience because of people's inability to understand it (due to literacy problems), because they misinterpret the message by attaching different meanings to the words or symbols used, or because they do not respond to the message due to a lack of income to purchase the advertised product. Media limitations also play a role in the failure of a communication to reach its intended audience. 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. In encoding a verbal message, care needs to be taken in translation. Numerous examples exist of translation problems with colloquial phrases. For example, when the American Dairy Association entered Mexico with its "Got Milk?" campaign, the Spanish translation read "Are You Lactating?" Low levels of literacy may result in the need to use visual symbols. Here again, pitfalls can arise due to differences in color association or perception. In many tropical countries, green is associated with danger and has negative connotations. Red, on the other hand, is associated with weddings and happiness in China. Appeals to humor or sex also need to be treated with considerable care as their expression and effectiveness varies from one culture to another. The dry British sense of humor does not always translate effectively even to other English-speaking countries. In addition to encoding the message so that it attracts the attention of the target audience and is interpreted correctly, advertisers need to select media channels that reach the intended target audience. For example, use of TV advertising may only reach a relatively select audience in certain countries. Equally, print media will not be effective where there are low levels of literacy. Certain media may also be more effective in certain cultures. For
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example, radio advertising has substantial appeal in South America where popular music is a key aspect of the local culture. The cultural context also impacts the effectiveness of communication. In "high context" cultures, such as the collectivist Asian cultures of Japan and China, the context in which information is embedded is as important as what is said (Hall 1976). In low context cultures, which include most Western societies, the information is contained in the verbal messages. In these cultures, it is important to provide adequate information relating to the product or service in order to satisfy their need for content (De Mooij 1998). Conversely, people in high context cultures are often more effectively reached by image or mood appeals, and rely on personal networks for information and content. Awareness of these differences in communication styles is essential to ensure effective communication. Global 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. An important issue in determining international advertising strategy is whether or not to develop a global or regional advertising campaign, or rather tailor communication to differences in local markets (Peebles and Ryans 1984). If the purpose of advertising is to develop a strong corporate or global image, a uniform global campaign is more likely to be used. When, on the other hand, the objective is to launch a new product or brand, or to more clearly differentiate the product or brand from other competing brands or products, local campaigns tailored to local markets are more typical. A global campaign offers a number of advantages. In the first place, it can be an important means of building a strong and coherent global image for the firm and/or its products worldwide. Use of the same image in different countries builds familiarity and generates synergies across world markets. It allows utilization of good ideas and creative talent (both of which are scarce commodities) on a worldwide basis. In addition, use of a single
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campaign provides substantial cost savings in copy development and production costs. Conversely, development of multiple local campaigns can lead to duplication of effort, result in inconsistent brand images across countries and confusion in consumers' minds with regard to the benefits offered by the brand and corporate image. While use of uniform advertising appeals offers a number of advantages, differences in customer perceptions and response patterns across countries and cultures, as well as media availability and government regulation are major barriers to use of a standardized campaign. Even though technological developments allow adaptation of advertising appeals to different languages (for example, TV can have audio channels in two languages, Internet messages can be automatically translated), development of visual and verbal copy that works effectively in multiple countries poses major creative challenges. Faced with this dilemma, firms may use a global umbrella campaign combined with local country or product-specific advertising. The global umbrella campaign develops a uniform image for the company or brand worldwide, often relying on consistent visual images and the corporate logo. Product-specific or country advertising builds on this image, modifying the appeal and providing information tailored to the local market. The objective of the umbrella campaign is to provide an integrating force, while local campaigns provide greater relevance to specific local customers and markets. The organizational structure of the firm often plays a key role in the choice of global vs. locally adapted campaigns. If international operations are organized on a country-by- country or geographic basis and operate as local profit centers with local advertising budgets, pressures exist for use of local advertising campaigns. If, on the other hand, the company is organized by product divisions, with centralized advertising budgets at corporate or regional headquarters, use of regional or global advertising campaigns is more likely (See Douglas and Craig (1995) for more information on global strategy).

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Global Advertising as an Industry The world advertising industry is characterized by a large number of small and medium sized advertising agencies that operate primarily in one country and by a small number of very large advertising agencies with operations in many countries. These agencies have developed extensive networks of offices throughout the world in order to coordinate the advertising process in all the countries where their clients do business. These networks often include both wholly-owned subsidiaries and formal relationships with local advertising agencies to establish a presence in new markets, particularly in emerging markets. In an effort to establish greater control over their advertising, many major advertisers are consolidating all their advertising with one agency. For some major advertisers such as IBM and Citibank, this represents annual advertising expenditures in excess of $500 million worldwide (Grein and Ducoffe, 1998). As a consequence, advertising agencies that do not have a global network are at a serious disadvantage when competing for new advertising accounts or attempting to retain existing ones that are expanding globally. The majority of these large advertising agencies are headquartered in the US. Of the ten largest advertising agency groups, seven are headquartered in the US, and one each in the UK, France and Japan, although WPP, the British agency holding company, is made up of two large US-based agencies. With the exception of Dentsu, the Japanese agency, most other agency networks generate the majority of their revenues outside their home country. The largest agency group, Omnicom, places over $37 billion of advertising for its clients around the world and derives half its revenue from outside the US. Omnicom has 891 offices in over 85 countries and employs 35,600 persons worldwide (57 percent work outside the US). US-based advertising agencies and their subsidiaries are responsible for most of the advertising throughout the world. For example, of the approximately $60 billion in advertising placed by the top 25 agency networks in Europe during 1955, 89 percent of the total was placed by subsidiaries of US-based agencies. This general pattern holds in most parts of the world that do not have restrictions on foreign ownership. The major exception is Asia where the three major Japanese agencies account for 62 percent of the advertising placed by the top 25 agency networks. Current and comprehensive information on advertising can be obtained from Advertising Age's web site, www.adage.com. Worldwide over $400 billion is spent on advertising.
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Approximately half of that amount is spent in the US and the other half outside the US. Information on advertising spending can be obtained from Advertising Age's web site and from McCann-Erickson's web site (www.mccann.com). The bulk of expenditure outside the US takes place in Europe and Japan, although Brazil, Canada, Mexico, and Australia are also important advertising markets. Outside of these markets, China is the next largest advertising market and is also growing rapidly. The Table below shows advertising spending in the top ten global ad markets. The US and Japan account for 65 percent of the total advertising spending in these markets and the top four European markets an additional 25 percent. Apart from Brazil, no other market accounts for more than two percent of the total spending. The concentration of spending in the US in part explains the dominance of US-based advertising agencies. Not only do they work for US-based clients that continue to expand outside the US, but also they accumulate knowledge and experience in the practice of advertising that can be applied elsewhere.

1997 Advertising Country Expenditures (millions) U.S. 117.0 Japan 35.7 U.K. 20.8 Germany 20.3 9.7 France 8.8 Brazil 7.2 Italy 5.5 Australia 5.4 Canada 5.3 S. Korea Total: 235.7

Percent 50 15 9 9 4 4 3 2 2 2 100

Note: The expenditures in this Table reflect only the 13 measured media tracked by Advertsing Age such as TV, magazines, radio, the Internet and yellow pages. The $400 billion figure cited above includes unmeasured spending such as direct mail, promotion & co-op advertising.

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Once the advertising message has been created, a media plan must be developed and specific media vehicles purchased to deliver the message to the target audience. Media differ from country in their availability, effectiveness and efficiency in delivering a message, and, with relatively few exceptions, tend to be organized on a country-by-country basis. Notable exceptions include Star TV, MTV, CNN in television, Business Week International, the Asia Wall Street Journal, the International Herald Tribune in print, and selected industry and medical publication that are read worldwide. There is also a trend toward consolidation of media in order to achieve greater economies of scale and leverage content developed in one market to others. This consolidation facilitates purchase of media on a regional and global basis. In addition, the Internet is emerging as a truly global medium that does not conform to country boundaries. 5. Global Advertising as a Social Force In the view of the advertiser the primary objective of advertising is to sell products or services. In achieving this primary goal, there are often profound secondary consequences. Advertising exerts a formative influence whose character is both persuasive and pervasive. Through the selective reinforcement of certain social roles, language and values, it acts as an important force fashioning the cognitions and attitudes that underlie behavior not only in the market place, but also in all aspects of life. In an international setting, advertising has an important social influence in a number of ways. First, much international advertising is designed to promote and introduce new products from one society into another. Often this results in radical change in life-styles, behavior patterns of a society, stimulating for example the adoption of fast food, casual attire or hygiene and beauty products. International advertising also encourages desire for products from other countries, it creates expectations about " the good life", and establishes new models of consumption. Advertising is thus a potent force for change, while selectively reinforcing certain values, life-styles and role models. Often the symbols, ideals and mores that international advertising portrays and promotes are those of Western society and culture. Through the reach of advertising, brands such as Levi's, Nike, Marlboro and McDonalds are known by and have become objects of desire for teens and young adults throughout the world. Similarly, images and scenes depicted in much international advertising are either Western in origin or reflect Western consumption behavior and values. Even where adapted to local scenarios and role models, those shown often come from sectors of society, such as the
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upwardly mobile urban middle class, which embrace or are receptive to Western values and mores. Consequently, a criticism frequently leveled at international advertising is that it promulgates Western values and mores, notably from the US, in other countries. This is viewed particularly negatively in societies with strong religious or moral values, which run counter to those of the West as, for example, Islamic societies in the Middle East. When Western advertising depicts sexually explicit situations or shows women in situations considered as inappropriate or immoral, it is likely to be considered a subversive force undermining established cultural mores and values. Equally, in some countries such as France, there is a strong negative reaction to the imposition of US culture, values and use of English in advertising. Promotion of tobacco products by US and UK companies in countries where there is no legislation regulating or banning cigarette advertising has also been criticized. At the same time, international advertising also acts as an integrating force across national boundaries. It disseminates messages using universal symbols and slogans, and establishes a common mode of communication among target audiences in different parts of the world. At the same time, multicultural values are reinforced by advertisers, who adopt images incorporating peoples of different nations and diverse cultural backgrounds, as, for example, the Colors of Benetton campaign or the British Airways "Peoples of the World" campaign. The impact of such campaigns is further reinforced by the growth of global media such as Star TV, CNN, MTV or print media that target global audiences worldwide. Consequently, while, on the one hand, international advertising can be viewed as a colonizing force propagating Western values and mores throughout the world, it is also an important force integrating societies and establishing common bonds, universal symbols and models of communication among peoples in different parts of the globe.

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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.

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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.

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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

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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

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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

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.

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Brand Ambassadors: their effect on Global 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 in its consumer's chocolate

confidence

brands following the high-pitch worms controversy, the company appointed Amitabh Bachchan for the job.

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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 is brought universally

Coca-Cola

acknowledged. A creation of Prasoon Creative Joshi, Director, National McCann-

Erickson, and the ad has been exported to foreign markets as well. Thus it proved beneficial for international marketing of the product.

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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.

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Highest Earning Celebrities

1. 2. 3. 4. 5. 6. 7. 8. 9.
10.

Amitabh Bachchan Sachin Tendulkar Narain Karthikeyan Shahrukh Khan Aamir Khan Aishwarya Rai Rahul Dravid Saif Ali Khan Saurav Ganguly Sania Mirza

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Impact Of Advertising On Sales

HERO HONDA

Sales Performance Dec'04 Domestic Exports 225250 5501 Dec'05 238822 6282 Apr'04Dec'04 1892540 43441 Apr'05Dec'05 2155479 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.

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Facilitating Agencies

Another external factor involves the agencies that facilitate advertising and provide the means to advertise. From a situation analysis viewpoint, the advertiser basically needs to know what kind of facilitating agencies exist and the nature of the services they can provide. From a planning viewpoint, much local advertising, for example, is done without the services of an advertising agency or a research supplier. A national advertiser, on the other hand, may have under contract many different agencies and research suppliers, each serving one or more brands in a product line made up of several products.

Many advertising decisions involve choices among facilitating agency alternatives. What advertising agency should be chosen? What media should be used? What copy-testing supplier will be best for our particular situation? Concerning the question for agency selection, for example, Cagley and Roberts found that the people factor tends to dominate in agency selection. Characteristics such as the quality of personnel, reputation, integrity, mutual understanding, interpersonal compatibility, and synergism were very important.

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Fact file

 The majority of large advertising agencies are headquartered in the US. Of the ten largest advertising agency groups, seven are headquartered in the US, and one each in the UK, France and Japan, although WPP, the British agency holding company, is made up of two large US-based agencies.

 With the exception of Dentsu, the Japanese agency, most other agency networks generate the majority of their revenues outside their home country.

 The largest agency group, Omnicom, places over $37 billion of advertising for its clients around the world and derives half its revenue from outside the US.

 US-based advertising agencies and their subsidiaries are responsible for most of the advertising throughout the world.

 China is the next largest advertising market and is also growing rapidly.

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Advertising Expenditure

The Table below shows advertising spending in the top ten global ad markets.

1997 Advertising Country U.S. Japan U.K. Germany France Brazil Italy Australia Canada S. Korea Total: Expenditures (millions) 117.0 35.7 20.8 20.3 9.7 8.8 7.2 5.5 5.4 5.3 235.7 Percent 50 15 9 9 4 4 3 2 2 2 100

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Top 10 Global Advertising companies.

Rank Company

Total U.S Advertising (Millions $)

Total Sales

U.S Advertising As A Recent

(Millions $) Of Sales

1 2 3 4 5 6 7 8 9 10

Philip Morris Procter & Gamble General Motors Sears RJR Nabisco Grand Metropolitan Eastman Kodak McDonalds Pepsi Co Kellogg

2,058 1.507 1,294 1,045 815 774 736 728 712 683

20,866 11,805 91,260 50,251 12,635 3,211 10,024 11,380 10,551 2,766

9.9% 12.8 1.4 2.1 6.4 24.1 7.3 6.4 6.7 24.7

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Factors Affecting Advertising The final external factor in the planning framework concerns environmental factor social, legal, and global. Law forbids deceptive advertising. One solution is to create brand advertising that is vague and contains little specific information. However, such an approach can result not only in ineffective advertising; by it can lessen the social value of advertising by reducing the amount for useful information that it provides to society. Thus, and advertiser who attempts to provide specific, relevant information must be well aware of advertising regulation.

Even more difficult consideration for people involved in the advertising effort is broad social and economic issues. Another concern is that advertising, especially when it is more irritating than entertaining, is an intrusion into an already excessively polluted environment. A whole set of rules is emerging to cover advertising directed at children, and advertising for products such as alcohol and cigarettes, and the use of environmental and health claims in advertising. Thus advertising has a tremendous impact on international marketing and the two concepts therefore go hand in hand and are dependent on each other.

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Five Keys to Radio Advertising Success

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. Frequency of Ads A radio commercial needs to air multiple times before it sinks in with the listener. 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. Target Audience Just like with every ad one create, you must know ones target audience. Advertising your western gear store on a country station makes sense. Advertising a teen clothing store on the same station doesn't. 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? Radio stations also offer programs you'll want to know more about before you buy.

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Producing A Commercial

Unlike television commercials, production is simpler for a radio commercial. However, that doesn't mean one should just slap something together. Your copy isn't relying on any visuals so it's vital you capture the listener's attention from the start. The copy needs to be crystal clear and not muddied by trying to be cutesy in your pitch. Frequency is the key so make sure your ad hits the mark and will get the consumer's attention the first time. Research shows it takes a few times before the consumer actually gets what your company is all about. It's vital your ad stands out and conveys your message repeatedly.

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Advertising Legends
1)

A G Krishnamurthy Ex Chairman & Managing Director

Mudra Communications
A G Krishnamurthy is the Captain who steered his agency from a Rs. 35 lakh company to a Rs. 7 billion corporation in a remarkably short 23 years. But little is known of his considerable contribution in the agencys creative reputation doubling up as copywriter/art director and quite often even as creative director
Brands: Rasna, Vimal Suitings & Sarees etc.

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2)

Brendan Pereira Chairman & Creative Director

From his palette of skills, Brendan Pereira has been imparting knowledge to a wide audience over his 40 years in the business of art, advertising design and communications. His work with agencies in London and a stint as Brand Manager at Beechams International, London, for a range of consumer products, created a firm base for the task of leading Aiyars Advertising in Bombay as Creative Director, and one of the first in the industry to be elected to the Board in that capacity. As Deputy Managing and Creative Director, he was one of the major shareholders who founded Chaitra Advertising, and led it on to produce some of the outstanding work of that era. Spreading his talent, he published his first book Changing Faces in 1999.

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Indian Advertising Industry    Concrete advertising history begins with classified advertising Ads appear for the first time in print in Hickey's Bengal Gazette. India's first newspaper (weekly). Studios mark the beginning of advertising created in India (as opposed to imported from England) Newspaper studios train the first generation of visualizes & illustrators     Major advertisers: Retailers like Spencer's, Army & Navy and Whiteaway & Laidlaw Marketing promotions: Retailers' catalogues provided early example Ads appear in newspapers in the form of lists of the latest merchandise from England Patent medicines: The first brand as we know them today were a category of advertisers

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Case study: Knockout shoes

Agency: Weiden & Kennedy Objective:

y

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

Target Audience:
y y

Young people -- open, ready and willing to have fun Active-minded 16 - 22 year olds during summer vacation

How Magazines Were Used:

y

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

Results:
y

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

Positive feedback from retailers and consumers

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Advertising Campaign Break-Through

1) Volkswagen The Volkswagen campaign of the 1960s is considered a huge breakthrough in the history of advertising. During this time, the auto industry tended focus on the beauty and engineering stretch of the vehicle. However, Volkswagen advertising broke through the clutter by creating ads based upon the same principle that drew drivers of Volkswagens in the first place: simplicity, honesty, uniqueness and humor. Now, the brand continues to stand out with maximum creativity.

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2) Marlboro

Marlboro Cigarettes The Marlboro Man smoking cigarettes has come to be one of the biggest icons of advertising. The handsome and suave person made smoking cigarettes look cool. It has demonstrated the powerful impact the industry has on consumers.

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Top Advertising Agencies in India

     

Mammoth Graphic Communications Accord Advertising FCB-Ulka Advertising Ltd. Glare Advertising Marketing Consultants & Agencies Limited Mudra Communications Pvt. Ltd.

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Bibliography
Websites: http://google.com/global-advertising Books referred: International Marketing Research and surveys via Colleagues in Warehousing business

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