Advertising and Promotion in Business - Assignment Example

Unit 18: Advertising and Promotion in Business 18 1. Explain the communication process that applies to advertising and promotion. The need of advertising and promotion of goods and services in today’s competitive market cannot be undermined. Advertising is the way of communicating to the consumers regarding the various brands that are available in the market. Marketing managers design marketing practices keeping in view their target consumers. The key players in the marketing communications industry grouped into sender, receiver, message, channel and respondents. Marketers are the senders who send information about products and services to the consumers who are the receivers. Message is all information related to products and it is spread via various media forms (channels) like print media, newspapers, magazine, digital media, television, radio, posters, internet, agencies and other bodies such as government, chambers of commerce, media and sport, trade bodies, photographers, designers, production companies etc. The consumers are the receivers who get knowledge about products available in the market, and finally consumers respond positively or negatively by accepting or rejecting the product or service. Although advertising is basically oriented towards persuading customers to buy or use a certain product or service, Duncan and Moriarty (1998, p.2) have emphasized more on communication than persuasion in the context of advertising since “communication – not persuasion – is the platform on which relationships (between company and consumers) are built”. Today, tourism is a rapidly growing industry and plays a vital role in the economic progress of a country. The promotional strategies of tourism are based on a country’s cultural values as inappropriate methods of advertising can be wastage of money. Each mode of advertisements like print media, television, radio, internet has distinct effect on people. Therefore the need is to understand the target audience, and accordingly plan promotional strategies. One effective method is pictures of popular places in a country with slogans like Australia is known for its beaches and water sports. Therefore, promotional pictures can include beaches with attractive slogans. In this way, the goal is to connect people with the country’s culture and natural beauty. In “Visit Australia” campaign, there can be seven elements of communication – “input, sender, channel, noise, receiver, output and fields of response” (Dasgupta, 2011, p.173). Here, campaigner is the sender of information about target place of visit. The input includes emphasizing on the cultural aspects and natural beauty of places, which can be transmitted through channels like different media forms. Potential tourists are receivers of the message, while the number of tourists visiting the places reflects the response of people. Output is the message decoded by receivers from the input. Noise can hinder smooth communication, and it can be internal like too many messages or external like background noise. For instance, tourist guides can find it difficult to communicate with tourists where there is background noise like noise of animals or vehicles in certain sites. Fig 1: Communication process model 18.1.2. Explain the organisation of the advertising and promotions industry. The advertising and promotional activities are governed by a few organizations. Advertising agencies are places where the real action of this industry takes places. Advertising agencies constitute of creative minds who come up with innovative ideas, and there are graphic designers, copywriters, market researchers, media planners, videographers etc. All of these people work in collaboration to devise the best promotional strategies. Advertising agencies can be large scale that serve international clients and have offices across the globe, or they can be medium scale having offices in different states of a country, or they can be small scale serving local clients. There are different types of advertising agencies. There are full-service agencies that provide all the services concerned with promotions. They conduct market research, design campaigns, and place advertisements in different media like television, magazines, internet etc. They can be structured where each department focuses on one aspect of advertising, and can be collaborative where members of every department work in collaboration for a common client. Some advertisers have in-house staff who does the planning and research, and select media forms. However, they take the help of creative boutiques who create the ad campaigns with their copywriters, graphic designers, and producers. Then, there are media-buying services who determine which media forms will serve the purpose of specific advertising campaigns. These services have knowledge about the most effective media forms based on the product and consumer interests. Being a commercial assistant to my embassy, I will take the services of a couple of advertising agencies for a period of twelve months. My goal will be to take the advantage of their expertise service and quality of work for “Visit Australia” campaign. Since, my objective is to increase the number of UK tourists visiting Australia by 10 percent next year over the figure achieved one year ago, therefore I will recruit agencies that have sufficient expert teams who will be able to effectively handle print media, television exposure, internet ad campaigns, social media advertisements, and outdoor activities. The agencies will have to implement innovative approaches to highlight the cultural and social values of Australia, and remove any inhibitions in the minds of potential tourists regarding the country. 18.1.3. Assess how promotion is regulated. Advertising and promotion is basically a process to generate consumer demands for products and services. This process should adhere to certain codes like it should be legal, decent, honest and truthful. There are many government regulations that control advertising and promotion industry in the context of the codes. For instance, the laws and policies set up by the UK government act as limitations and constraints in the manner in which companies market their products. In this section I will mention some of the business oriented laws passed by the UK government. One is Sales of Goods Act 1979 which states that products that will be sold in the market should be according to the specifications mentioned in promotional advertisements. This is mainly applicable for electronic goods. The company must not include in its promotional slogans such features or characteristics that do not exist in the product. Another law is Data Protection Act 1998 which enforces the rights of customers to protect their private information like address, contact number, age etc from unfair use. For instance, a company must garner permission from customers before sending regular newsletters or future offers to them. Also, a company cannot store data of consumers longer than necessary. The UK government has also defined Acceptable Language which indicates that a company cannot use words or images in their advertisements that can hurt racial or gender sentiments. Under this rule, Advertising Standards Authority can deny promotional rights of certain advertisements or can ask the company to modify the same. In March 1990, an international conference was held in Vancouver, Canada in which action strategies for sustainable tourism promotion were created. The strategies are based on three broad categories. First, in legal context tourism development must be considered at par with any other economic activities that contribute toward long-term economic development of a country. Second, there must be a process of garnering information about tourism so that regular activities can be supervised, assessed and identified. Finally, tourism must be promoted in the way that will help in the industry’s sustainable development (Sharpley, p.49). 18.1.4. Examine current trends in advertising and promotion, including the impact of ICT. Advertising and promotions are the main communication channels between companies and the public to create awareness about not only new products and services, but also of upcoming events, movies, contests, elections, national level examinations, etc. With the increasing significance of this sector, today many new avenues are emerging for the convenience of advertisers. Internet, social media sites, emails, smartphones, etc. are some of those platforms which are rapidly becoming popular for promoting goods and services. There are many online advertising tools like the Google AdWords which allows small companies to post their advertisements with keywords. Social media are ideal platform for posting ads since today millions of customers are members of such sites and visit them on daily basis. People can choose to like the ads and this can attract the attention of everyone who is in their friend list. Thus, there can be rapid multiplication of customers who will notice the ads. There is also content marketing which means writing articles on a product or service and posting them in blogs or social networking sites to spread the awareness of new products and services. Today, many companies can host blogs where consumers can navigate to know about the products or services, and also provide feedback. Customer feedback is now becoming an integral part of advertising campaigns. Moreover, there is the growing trend of using celebrities (movie stars, politicians, sportspersons) to promote brands. It is often seen celebrities wearing clothes in public events with the brand’s name prominently written. In tourism, people select their country of destination based on the information available. With the use of ICT, the tourism industry can provide quicker and reliable information to potential tourists. Today, social network users unwittingly become promoters of tourism as people from different countries share photos and information about their country’s natural and cultural environments. Another current trend is tourism promotion with festivals. Governments today are focusing more on promoting tourism with the purpose of making it more profitable. Although it is possible to promote tourism in many ways, festivals and cultural events can have a big role in this. Organization of festivals can act as leverage in attracting more tourists. Festivals make people visit the place and stay there throughout the duration of the festivals. Festivals also encourage people to spend more thus contributing to the economy of the region. Since festivals help in promoting tourism, many other services connected with tourism get benefited like hotels, restaurants and transport system of the cities in which the festivals are held. Today, many public and private companies come forward to organize festivals in large scale in order to attract people from all over the world. 18.2.1. Explain the role of advertising in an integrated promotional strategy for a business or product. Advertising is the most effective and convincing tool in an integrated promotional strategy for a business or product in today’s era of competition. Unlike other forms of promotions, advertisements can reach the intended message to customers via various media forms like television, radio, newspapers, magazines, websites, emails etc. With advertising, business or products can be promoted on a large scale. When new products are launched in the market or improvements are made in existing products, advertisements play an important role in sending the message to the intended customers. Without such awareness people will not buy the products even if they are in need of them. Thus, advertising is important for customers. Advertising helps to enhance sales by creating awareness in customers about new products, and also helps to increase demand as continuous viewing of advertisements in different media forms induces people to buy the same brand. Advertisements involve market research which helps in understanding market trends. This helps in launching of new products. Moreover, advertisements help companies to know about competitors and this helps them to design promotional campaigns to beat the competition. Thus, advertising is important for companies. In tourism industry, advertising can be used as an important tool for promotion. For instance, as part of “Visit Australia” campaign, the country’s tourism can be effectively promoted by considering its cultural values, and by efficiently using the different kinds of advertising. The country is known for its beaches, water sports, wildlife, and specific tourist attracts like Sydney Opera House, Great Barrier Reef, etc. These can be promoted with the help of logos, images, and slogans. Brochures can be distributed on the Internet, and they should not only be descriptive about Australia’s tourist attractions. Brochures should be attractively designed and provide correct information to garner interest and demand. 18.2.2. Explain branding and how it is used to strengthen a business or product. Branding is the strategy of attributing certain features and characteristics to a product thus differentiating it from other similar products. Today, consumers face the challenge of selecting between similar products ranging from toiletries to consumer electronics. Branding helps consumers to identify the product with their desired specifications. It also helps consumers to compare products of different brands based on their price and specifications, and thus reduces the possibility of wasting money by buying the wrong product. One main element of branding is to create brand equity which is defined as “positive differentiation effect on recognition of the brand that has on customer reaction to the product or service in question” (Todor, 2014, p.60). Therefore, brand equity enables customer to associate positive elements to specific brands which creates emotional connection. For instance, Hallmark greetings cards are known for promoting family love, and this has a positive effect on its sales. In tourism, destination branding plays a vital role. It is the strategy of projecting a unique perception of nation with the help of logos, symbols, slogans, or graphics. The goal is to project a positive picture of the country that will convince potential tourists that their travel experience will be a memorable one. Destination branding also instills in the tourists a pleasurable feeling of their travel so that they can recollect the memories and will be persuaded to revisit the country (Kerr, 2006). For instance, there can be a campaign like “Visit Australia”. This country is globally perceived as a modern, clean and secure place with many cultural and artistic sites, and so people will be inclined to select that country as their travel destination. In such case, destination branding becomes an easy task compared to a country that is globally perceived as corrupted and crime prone. It will then be a difficult task to convince people to travel in that country as branding will have to convince them that either such negative elements do not exist or such elements will not affect the travel experience of potential tourists. The concept is complex than product branding since tourism is more of an experience than any real product. 18.2.3. Review the creative aspects of advertising. Since the principle goal of advertising is to entice customers to buys products or use services, therefore creativity is an indispensible element. Without creativity ad makers cannot draw the attention of customers in this competitive market. One creative aspect of advertising is developing market mix which is every possible actions taken by a company to increase its sales of products and services. The 4 Ps of marketing mix are product, price, place and promotion. Product is that which is produced by the company, and it has distinctive attributes and features that are based on market research. Products are also considered for their packaging, brand loyalty and convenience. Product features need to be designed keeping in mind the target customers. Price is the conceived total value of the product by the buyer and the seller. For the seller, price needs to cover the production cost and profit. A seller will consider other brands of similar products and the assumed need of the product. Place means the distribution channel through which the right products reach the right customers in the right condition. Promotion is the marketing communication by which customers are made aware of available products in the markets or new products launched in the market. In case of “Visit Australia”, product includes all the amenities and comforts provided to tourists like hotel facilities, transport, food, and other services. As part of good promotions, free meals can be offered. To attract tourists price needs to match the product which can be done by adding features to the product while keeping the price same or providing discount for same features. Today, promotion of tourism is mostly done over the internet. People buy plane tickets and book hotels online. 18.2.4. Examine ways of working with advertising agencies. There are different ways of working with tourism as advertising agencies so that maximum benefits can be got. There are many marketing avenues that can enhance relationship with UK customers. Traditional advertising can be used to grab the attention of people by placing pictures of scenic beauty and slogans in newspapers and magazines. Brochures are very useful since tourists like to carry these when they are visiting a country. Brochures need to be made based on research, attractive with high quality images and maps, and content needs to be informative yet concise. Tourism operators can also visit trade and consumer shows as it is a cost saving method of reaching out to large number of people. Finally, attractive websites can be a good marketing strategy and also emails to potential tourists. The advertising agencies can help in advertising not the product or service directly but the means adopted to promote the same, such as, lottery or lucky draw contest, some packaged tour, etc. The direct costs and opportunity cost is reduced as a large part of the promotional work can be handled by the advertising agencies. For “Visit Australia” campaign, I will require an advertising agency to do market research, establish the best places for advertisements, and reach target customers. The objective is to promote Australia among potential UK tourists as a pleasant tourist destination. The agency will perform the following the functions: Account manager: He will establish a link with the tourism managers in Australia. The desired objective which is increasing UK tourists by 10% will be explained to the agency’s employees. The employees can be informed to participate in various tasks like planning promotional activities, targeting the objective, reach the target customers, and study market trends. Marketing/Media Department: This department will focus separately on different groups of customers like newly weds, families, friends etc. Accordingly they will use media forms to attract the attention of target customers. They will look at previous data and select media forms after negotiation media prices with media providers. Creative department: This department will mainly focus on creating brand image. They will create slogans, logos, and bring up unique ideas to be used in advertisements. Such images and slogans will be constantly updated and modified to satisfy the client. Production department: This department will arrange to publish the necessary information, slogans and logos in tourist magazines, leaflets, brochures to convey message to customers in attractive manner. Following are images of tourist attractions and slogans for Australia: Sidney Harbor Bridge A perfect location in the heart of Melbourne Sydney Opera House Slogans: 18.3.1. Explain primary techniques of below-the-line promotion and how they are used in an integrated promotional strategy for a business or product. Below-the-line (BTL) promotions are “short-term incentives, largely aimed at customers”, and they are usually “forms of non-media communication” (Mishra, 2009, p.29). The principle objective is to increase sales in short run, and BTL promotions are used in an integrated promotional strategy in various ways depending on the company’s competitiveness and the market trend. With the increasing need of promotional activities within limited budgets and time constraints, BTL promotions are gaining more importance. There are various methods of BTL promotions. Price promotion means products offered at discounted rates or improved products offered at normal price. However, price promotions should be strategically implemented since it can adversely affect the brand image of a product as consumers will feel that the brand is losing popularity. Then there can be door-to-door selling, redeemable coupons with expiry dates offered with newspapers or magazines, and loyalty programs which offer special discounts or other offers for consumers who consistently buy a specific brand of product. In case of “Visit Australia” campaign BTL promotional techniques can be used for increasing number of tourists during off season. Hotels can offer rooms at discounted rates, group booking offers can be launched, festivals or important events like sports can be organized, etc. 18.3.2. Evaluate other techniques used in below-the-line promotion. There are others forms of BTL promotions in for “Visit Australia” campaign like direct selling, emails, sponsorships, etc. Emails can be sent to potential tourists with pictures of the country along with details of top hotels, accommodation, transport, and shopping facilities. Moreover, companies can sponsor tourism like many brands can offer customers a chance to travel to a certain place if they buy their products. Often customer names are selected through lotteries. In such cases, people who did not previously plan for a trip will travel after getting selected since such offers usually provide free travel and hotel stay for a specific period like two days and three nights. Finally, public relations (PR) play an important role in tourism publicity. It is comparatively cheaper than other promotional techniques, and can create an improved relationship between the company and the public. PR creates images of destination places created by public opinion, word of mouth, and the approach of the targeted audience. With effective PR, potential tourists will get the idea about the experience that they will gain from visiting Australia. Images can be conveyed through brochures, advertisements, travel shows on TV to expose audience to exotic locations. In this era of competition, PR can be very effective if properly applied. 18.4.1. Follow an appropriate process for the formulation of a budget for an integrated promotional strategy. It is important to formulate a realistic budget for promotions since it is an integral part of marketing products and services. There can be affordable method which is mostly used by small companies. These companies first allocate budgets for all other aspects like production, administration, etc. and then spend the remaining funds on promotions. These companies do not give due importance to promotions as they do not expect returns from promotional expenses. One weaker process is arbitrary allocation which is based on management’s decision and mostly there is no systematic thinking or consideration of concept and purpose of promotions. One very common process is allocating percentage of sales revenue or percentage of profit. In case of slow market growth companies often use the historical method which means they adopt the budget used in the previous year. There is competitive parity method which means companies observe the marketing strategies of their competitors and attempt to spend as much as the competitors, if not more. PROJECT: VISIT AUSTRALIA   Budgeted cost per month (£)         Jan Feb Mar Apr May Jun Agency fee 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 Monthly Advertising and promotion costs             Adverts in Holiday Magazines 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 Adverts in Travel Magazines     2,000.00   2,000.00   Online Advertisements 5,000.00           Printed Leaflets   3,000.00   3,000.00 3,000.00   Shared Webpage 2,000.00           Product Placement   5,000.00   5,000.00   Total 9,750.00 5,750.00 4,750.00 5,750.00 7,750.00 2,750.00 36,500.00             Jul Aug Sep Oct Nov Dec Agency fee 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 Monthly Advertising and promotion costs             Adverts in Holiday Magazines 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 Adverts in Travel Magazines     2,000.00       Online Advertisements 10,000.00           Printed Leaflets   3,000.00     3,000.00   Shared Webpage             Product Placement     5,000.00       total 12,750.00 5,750.00 4,750.00 2,750.00 5,750.00 2,750.00 34,500.00 71,000.00 For tourism campaign, budget needs to be made for advertising in different media, setting up websites, sending emails to customers, making brochures, and attending trade and consumer shows. 18.4.2. Carry out the development of a promotional plan for a business or product. Promotional plan means deciding the ways to advertise and promote a business or product, and such planning is made after several considerations. In case of club membership promotion, tools like SOSTT+ 4M’s have been used. The following table is an outline of the campaign. Element Description Situation Available financial resources and personnel Objectives To attract more tourists during off season Strategy Attractive and information based brochures, advertisements on TV, magazines, and the Internet. Tactics Hotel rooms at discounted price, emails to potential tourists, sponsors by brands, travel shows on TV Targets Newly wed couples, families, and the youth Men TV, magazines, brand sponsors, festivals and events, brochures, CDs and DVDs, etc. Money Budget is high since unlike peak seasons, in off season intensive and pervasive advertising and promotions are needed Measurement Market survey, effective response to customers’ queries, offering of coupons and vouchers Lucky Draw Contests: Couples can be selected and brought under one umbrella where the offers and benefits can be explained to them. As a gift voucher, stay at the hotels financed by the club might be provided to the couples at a nominal cost for two nights’ stay at some selected destination. 18.4.3. Plan the integration of promotional techniques into the promotional strategy for a business or product. Promotional techniques need to be integrated into the promotional strategy after considering the product’s elasticity of demand and market trend. For instance, price promotion technique can be used in tourism during off-seasons, or at a time when a country is experiencing negative elements like civil wars, political tension, etc. Potential tourists will not find it secure to visit those countries and can be enticed with discounted hotel rates and other offers. In any kind of promotions, the communication message should be clear so that people get precise idea about the offers. Promotional techniques can be used according to the time of the year. During off-season, there are certain strategies to attract people. Range of people who tend to travel during off-season are senior citizens, honeymoon couples, business delegates, and special interest tourists. Families with school going children tend to travel during holidays and hence are not target customers during off-season. Promotional strategies need to be designed according to the range of customers. Business delegates often are constrained by their professional needs and so they cannot be tempted by promotional techniques. Cheaper holiday packages can be useful during off-season. In a land like Australia, the hottest months are December, January and February. Therefore, during this period tourists generally prefer to avoid the country. To make the strategies successful it is important to give potential customers a taste of the experience first. The lucky draw contest can be used in this respect. Couples may be gifted with stay at some luxurious hotel financed by the company. A taste of the privileged offered by the company should automatically urge them to spread the word of mouth and also avail club membership themselves. The right way of communication is important. Month by month promotional techniques Strategies Implementation Benefits January Online Ads Web banners, google page, social networking sites, pop-ups, adware Cost effective, target customers, various formats (video, image, audio), global coverage Brand Image Logos, symbols, slogans, or graphics reliability, trust, consistency PR Emails to customers, brochures, trade fairs Cost effective, target customers, reach large audiences Shared webpage Placed in same server as many other sites Cost effective, target customers, various formats (video, image, audio), global coverage Ads in bride magazines Placed in bride magazines, honeymoon packages Targets newly weds February Bride fairs (+leaflets) Leaflets distributed in bride fairs Cost effective, newly weds Direct marketing+leaflets Emails, sms, telemarketing, online display ads Extremely effective, builds personal connection, target customers March Product placement TV Travel shows, logos on celebrity costumes during public events, films Attracts target customers, strong impact Ads in travel guides Placed in travel guides Target customers PR Emails to customers, brochures, trade fairs Cost effective, target customers, reach large audiences April Bride fairs (+leaflets) Leaflets distributed in bride fairs Cost effective, newly weds Direct marketing+leaflets Emails, sms, telemarketing, online display ads Extremely effective, builds personal connection, target customers May Ads in travel guides Placed in travel guides Target customers Bride fairs (+leaflets) Leaflets distributed in bride fairs Cost effective, newly weds Product placement TV Travel shows, logos on celebrity costumes during public events, films Attracts target customers, strong impact June Bride fairs (+leaflets) Leaflets distributed in bride fairs Cost effective, newly weds Direct marketing+leaflets Emails, sms, telemarketing, online display ads Extremely effective, builds personal connection, target customers PR Emails to customers, brochures, trade fairs Cost effective, target customers, reach large audiences July PR Emails to customers, brochures, trade fairs Cost effective, target customers, reach large audiences August Direct marketing+leaflets Emails, sms, telemarketing, online display ads Extremely effective, builds personal connection, target customers September Product placement TV Travel shows, logos on celebrity costumes during public events, films Attracts target customers, strong impact Bride fairs (+leaflets) Leaflets distributed in bride fairs Cost effective, newly weds October Direct marketing+leaflets Emails, sms, telemarketing, online display ads Extremely effective, builds personal connection, target customers PR Emails to customers, brochures, trade fairs Cost effective, target customers, reach large audiences November Bride fairs (+leaflets) Leaflets distributed in bride fairs Cost effective, newly weds Direct marketing+leaflets Emails, sms, telemarketing, online display ads Extremely effective, builds personal connection, target customers PR Emails to customers, brochures, trade fairs Cost effective, target customers, reach large audiences December Ads in bride magazines Placed in bride magazines, honeymoon packages Targets newly weds Ads in travel guides Placed in travel guides Target customers Online Ads Web banners, google page, social networking sites, pop-ups, adware Cost effective, target customers, various formats (video, image, audio), global coverage Shared webpage Placed in same server as many other sites Cost effective, target customers, various formats (video, image, audio), global coverage 18.4.4. Use appropriate techniques for measuring campaign effectiveness. There are various techniques for measuring the success of the membership promotion campaign. First, a market survey can be conducted after the campaign ends to understand the trend of sales. If the number of tourists’ memberships increased then the campaign would be considered as successful. Second, the campaign can be considered effective if consumers are making more queries of the product over phone, emails or by visiting the company’s website. Moreover, increased redemption of coupons and vouchers can also indicate positive consumer response. The following table gives a chart of techniques to be used and plan to be implemented. It is important to use the right mix of strategies as described above in order to attain the set goals of the project. Convincing through word of mouth is important and providing good service after one takes the offer can only help in expanding the membership database. Also targeting the appropriate sample can bear fruit faster. References Dasgupta, D. (2011) Tourism Marketing, Pearson Education Duncan, T. & Moriarty, S.E. (1998) A Communication-Based Marketing Model for Managing Relationships. Journal of Marketing, 62(2), 1-13 Kerr, G. (2006) From destination brand to location brand. Journal of Brand Management, 13(4/5), 276-83 Mishra, P. (2009) Sales Management: Keys to Effective Sales, Global India Publications Sharpley, R. (2009) Tourism Development and the Environment: Beyond Sustainability? Routledge Todor, R. (2014) The importance of branding and rebranding for strategic marketing. Economic Sciences, 7(2), 59-64 Read More