9.Advertising & Sales Promotion

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INDUSTRIAL MARKETING

ADVERTISING AND SALES PROMOTION


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INDUSTRIAL ADVERTISING

Any paid form of non personal presentation by an identified

sponsor( of industrial goods,services or ideas )

Its management is like that of consumer goods advertising,

in that the advertiser must

--Measure his potential market

--Study buying habits and motives of possible users

--Determine advertising objectives

--Setup budget

--Select media

--Prepare and place Ads


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If it can show above

Will help in salesmen tasks

Salesman can convince buyers that company

is desirable source of supply

2.Task often complicated because

Loses identity in the end product

e.g. Raw material, Semi finished products, components

Hence difficult or impossible to make Brand preference.Basic Industrial products are sold at competitive prices

hence lower gross margins.

3.Multiple influence buying

e.g. Substitution of machined part by casting

Effect on quality)

Analyse-Buying policies and practices of industry

individual plants, Key influencing people and media to

reach these people most effectively and at minimum cost


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4.When introducing new product or improved product

Go to customer's customer to convince him tospecify this product in his order

OBJECTIVES

Advertising-A marketing tool

User to know what tasks it is suited forand what for he wi II use it

Overall company objective Goals of marketing activity

Objectives of advertising

Advertising goals vary from company to companyand time to time


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Some general objectives are

1.To Inform

Primary objectives of all advertisers is to inform abouthis products and services

More important in industrial goods since bought on factual basis

If industrial advertisement is read, it is read carefully,

as a part of the job, to stay informed.( not emotional or only for pleasure)

It should contain more facts. Facts should be precise, documented and

provable. Facts should be solid.

2.To bring in orders

This is an end earnestly to be hoped but hardly to be expected.

No buyer commits to buy on advertising, may place trial order. Lot of work

needed afterwards to ensure that product gets fair trial


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3. Toget enquiries

Every industrial advertisement has this objectiveEnquiry expected from

Not currently user of this product

Current users not conversant with other uses

Users or prospects where salesman has failed to gain

access

4.To get name in buyer's resource file

File mainly for standard equipments

Keeps pertinent information-Quality, service, financial

standing, prices, reliability etc.

Selected from list when bid or existing buyingrelationships are disturbed

Registration needed when moving to new markets, new

products or new group of buyers


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Trade journals generally referred when buyer's product

processes or product lines are changed or has to buy

unfamiliar products.

5.To reach personnel inaccessible to salesman

When cant contact all persons-Research

scientists/Engineers, Outside directors

Very large number of persons, who influence buying e.g.

Steel mill

Ad may convince them of product virtues at least to theextent that they don't seriously object to recommendation

6.To provide supporting programme to Salesman

Important objective-Prepare prospective customer

to salesman

Already informed-New products, how profitably used,company's position and policies, hence saves

salesman's time to close the order


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Advertising company's salesman are received more

cordially as compared to others. It can open many closed doors.

More appropriate when new prospects or new industryis to be reached.

7. To reduce selling expense

Reduces salesman's work hence cut costs

Regular contacts necessary otherwise even loyalcustomers leave. Salesman's visit expensive. Advertisement

(Low cost per contact) keeps touch

When goodwill is to be built or keep product dominant

in customer eyes, ad is more effective

8. To help get news items

Even in Trade journals,news is read more than ads

When new product or new usage of old product

Heavy & consistent-get editorial attention


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9.To establish recognition and reputation

Straight product advertising doesn't help

Company reputation and Brand recognition required,

since more familiar brands specifiedPeople in plant no less

Distributor less profit

10.To motivate distributors

To get middleman's sufficient time and effort( Since competitors products also handled)

Advertisement copy-Directed to middlemen of

advantages, wide margins, large scale potential,

rapid turnover or relatively small investments

Enquiries from advertisement-may be forwarded,

can refer names in adCooperative promotion-Subsidised,name printed

on catalogue


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11. To create company image

Established in one field, difficulty for breaking in to other

field, because primary market overshadows e.g.

HMT , a watch supplier( Consumer product) TO

Components for weapon (Industrial product)

Advertisement--Directed to top management

Directed to R & D , Production

In business publications of technical capabilities

12.To overcome prejudice

To overcome unfavourable attitude because of past

problem

Advertise--Explaining reasons and how it has been correctedSynthetic product/ Natural product

Polyamide cage /Steel cage


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13.To influence users of customers end product

Induce the use of new products made out of materials or by

machinery manufactured by the advertiser. ( Excello machines)

Increase the sales of end products made of materials or

machine manufactured by the advertiser. ( SAIL steel, Salem steel

for home appliances )

When a material or component is branded and retains its

identity in the finished end product-inducing end users

to insist to the products containing branded items

General considerations

Not all objectives in every campaign

Advertising objectives change from time to time

Different companies have different objectivesSeveral objectives could be in one campaign but

weightage may be different

Goals must be clearly understood and advertising tools

should be effectively used


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ADVERTISING BUDGET

Half the money spent on advertising is waste but no one

knows which half.

How much to spend on advertising?

1. % of sales method

Some firms--%

of expected sales or last yearNeither assure-It will result in greater profit or will attain

non profit marketing objective

2. Task method

Some firms-Based on tasks,advertisement is expected to doDecide the tasks-Budget the costs

Management will decide-Which tasks worth the cost and

within financial resources

Better method


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3. Task & % method

Budget determination by tasks

Management imposes limit as % of sales

It can vary with changed circumstances

Amount to be spent

Gross profit cash inflow-Limit on all expenditure

Each rupee spent adds to profit> Rupee spent

Difficult to apply-Since unknown variables use

mathematical formula

When advertising objective other than profit-Allocate

money as per estimate to achieve that objective


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,)

APPEALS USED

1.Economy- Does not mean low selling price(Low cost in

use)

2.Quality- Catchall appeal

3. Efficiency

4.Dependability

5. Power6.Strength

7.Durability

8.Accuracy

9.Service

10.Complete line

11.Experience Patronage appeals

12.Popularity


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Which appeal? Choice will depend upon

1.The particular characteristics of the featured product thatdistinguish it from other products of the same kind

2.General plan of personal sales force

3. Types of functional group of people in customer's firm, the ad is

designed to influence

4.The part of overall job assigned to advertisement

Purchase-Attractive, quick to read-Company, product,services

Plant people-Clear descriptions

Design-Specific details-Capacity, circuits etc


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INDUSTRIAL ADVERTISING COPY

Orientation

Fundamental difference-In point of view from consumer

advertising

Consumer-Reads for pleasure

Industrial consumer-Primary to help himReads in company time

Read intensively

Want facts

Art work and catch phrases-To increase readability

Contents

1.Nature and distinctive characteristics of the product

2.Advantages over competing products

3.Adaptability to buyer's needs


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4.Experience of others in use

5.Gain to result from purchases

6.Dependability of supplier

a.As to claims made of product

b.As to delivery and fulfilment of contract

c.As to servicing and repair and replacement

Long copy will not disinterest reader provided it is of interest andpractical value

Sequence of elements

Short headlines--Presents an interesting and intriguing idea with

enough significance to make reader pursue idea further

Explanation or amplification of headline--With limited specific

appeals how his need will be fulfilled

Copy--Contents as above

Finally--Reader urged for some action; Specific courses of action

suggested


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Trademark VISInstitutional copy

Whether trademark or company name?

Different school of thoughts

Company name

Once confidence,will buy

Efforts & expenses to establish brand name not required

On diversification, brand name create confusion and make

promotional task difficult

Brand name

Easy to correlate

Brand can bring reputation or even lose it

Excellent headline attraction

Editorial type copy more effective

Legal requirements--General prohibition on false claims


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MEDIA

Medium is a vehicle through which advertisers message is carried

to its audience

Limited scope--Trade journals, General management publications

Catalogues, Direct mail, exhibits

Choice of media--Depends upon audience to reach

Complex--Multiple influence buying

Top management--One type magazine

Operating management

Design Different magazinesPurchase

Foreman


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ROLE OF ADVERTISING AGENCIES

Specialist organizations, equipped to provide range of

advertising services to their clientsAdvertising strategy and campaigns

Prepare copy and layouts

Study markets

Select media

Carryout actual physical production of advertisement

up to time it is sent to media

Generally serve non competing clients

They get 15% commission from media

Does not cover cost--Less chargesLump sum payment made

Many do not use advertising agencies, have their own department

Copy technical, catalogue difficult


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PUBLICITY

Non personal stimulation of demand for a product, services or

business unit, by planting commercially significant newsabout it in a published medium, or obtaining favourable

presentation of it on Radio, television or stage, that is not

paid for by the sponsor

Activity supplement to advertising

Publicity more effective than advertising--People read more news

Some--influence editors

Some--Editors look for material worth the news

Some--indifferent to publicity

When market concentrated and easily reached

Product is fabricated material or process material which

can't be identified in end product

Monopoly position--To protect from competition


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Some--Very powerful tool

Company made known to potential customers

Enhances prestigeIntroduction of new product

New development or improvement in existing product

Easy access to salesman,more effective, less costly

Techniques of securing publicity

Wants to publicise

Technical information of products

General merits of products

Publicity function to individual

For newsworthy information from company & industry

and pass on to the pressWrite technical articles


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Write books

Speaking before other organization

Papers on current research and new product

development

Plant visit by people


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SALES PROMOTION

Sales promotion are those marketing activities, other

than personal selling, advertising & publicity that

stimulate consumer purchasing and dealer effectiveness

In Industrial marketing, generally the following sales

promotion activities are used

1.Scheme for traders

Higher discount for limited period

Target bonus

2.Scheme for opinion leaders

Exhibitions, shows, expositions Samples

Correspondance

Direct mail

Catalogues

Advertising novelties


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3.By giving incentives to consumers (Cartons back)

1.EXHIBITIONS & INDUSTRIAL SHOWS

It offers manufacturers, an opportunity to display and demonstrate

his products to a large number of prospects, within a short period

of time, which otherwise would not be possible because of

widespread nature of his market

Exhibitor's obiective

Since it is usually hard to trace sales that result from this type

of promotion, the show's value to the exhibitor must often be

measured in terms of more limited objectives as under

Meeting potential customers

Making direct sales

Building prospects list

Discovering new applications for existing products

Introducing new products


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Demonstrating non portable equipments

Meeting competitive effort

Hiring personnelEstablishing new representatives or dealers

Scheduling trade shows

Problem--When products sold to several industries

Evaluation of trade show

Frequency and location of each show Audience

Acceptance in trade

Management reputation in good publicity and sound

operating policiesRates charged Restrictions on exhibitors

Number& types using show regularly


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Planning and operating the exhibit

Proper selection and dramatising the themePreparation and display of headlines, illustrations

Background of booth

Operations--By sales

Take help from technicalSamples, give aways

Follow up

Mail what is asked for, Salesman visit

Critically review--Design, layout,registration,handlingof traffic, presentation, accuracy

Analyse and redefine objectives, usefulness


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Sampling

To introduce new productTo gain prospects attention and interest

To gain an entry ( Medical rep )

Overdoing this is expensive but it should be viewed as

incremental expense

By mailing--may not examine

some--by coupon through ad

some--small cost

Correspondance

Auxiliary promotional device

To be handled carefully by a person who has complete

knowledge of the subject


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Catalogues

It is basic promotional tool. It is a sort of written material,describing the characteristics of a product, to place in the

hands of prospective customers

It is one of the largest item in sales promotion budget

Objectives

To get orders

To develop recognition by buyers

To get request for detailed information

To get invitation to bid or to solicit business

To get specification adoptedTo get product recommendations

To help get approval


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Preparing a catalogue

Which functional group of customers want

Purchase, engineering, maintenance

What information is sought, language

Who makes and sells what?Physical and operating characteristics

Application details

Dimensions, service needs, assembly

procedures, Drawings, facilities, distributor address

Distributing a catalogue

Very important to know persons whom to distribute


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Advertising novelties

It is the necessary means of promotion. Advertising novelties aresmall,interesting or personally useful items on which are

imprinted the name and advertising message of the issuing company

It should meet four requirements

1.Inexpensive--Expensive may be viewed differently.Give to maximum people, concerned persons

2.Unusual and eye catching

3.Multiple impact--Advertising message should be seen by a

number of people over a period of time

4.Useful


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Entertainment to customers

Very important

Depends upon product

May be viewed negatively

It is contrary to good business judgement

Consideration of propriety

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Documents

9.Advertising & Sales Promotion