Sunday, 21 September 2014

Advertising and sales assignment for Sem V


Assignment to be submitted with examples in your own words. IT should not be a direct copy from books or Internet. In case it is found to be a copy zero will be awarded. Submit by mail. Last date is Thursday 25th September

Meaning, nature and importance of advertising; 503
Types of advertising; 506
Advertising objectives and audience selection;512, 515
Setting of advertising budget. 519
Major media types - their merits and demerits; 528,531,536 print, a/v, ooh
Factors influencing media choice.539
Advertising appeals, 542
Advertising copy and elements 545
Evaluating communication and sales effects 548
Pre and Post testing techniques. 551,555
Role, types and selection of advertising agency.559
Ethical and legal aspects of advertising.562
Nature and importance of personal selling; 566
Types of personal selling situations and selling jobs; 569,573
Personal selling and salesmanship; 576
Characteristics of a successful salesman;585
Customer knowledge – buying motives and selling appeals; 592, 595
Product and market knowledge. 598
Prospecting, pre-approach and approach; 600,602
Presentation and demonstration.605
Types of objections; 610
Handling objections; 636
Closing the sale, Customer follow-up 639
Sales forecasting; Sales budget; 634
Sales quota; Sales territories. 632
Recruitment and selection; 631
Training and development; 629
Direction and supervision 619
Sales force motivation and compensation 618

Sales force performance appraisal. 612

Thursday, 18 September 2014

Online Ad Market

Online advertising market to touch over Rs 3,500 crore by March 2015

The online ad segment is expected to grow at a compounded annual growth rate of 25 per cent between FY'2011 to FY'2013.
The online ad segment is expected to grow at a compounded annual growth rate of 25 per cent between FY'2011 to FY'2013.
NEW DELHI: Rising marketing spend in sectors like e-Commerce, telecom, FMCG andconsumer durables will help the online advertising market in India, which is projected to grow at 30 per cent to touch Rs 3,575 crore by March 2015, a IAMAI-IMRB study today said. 

According to the study, the online advertising market has grown from Rs 1,140 crore in 2010-11 to Rs 2,260 crore in 2012-13 and was estimated to be worth Rs 2,750 crore in 2013-14. 

The online ad segment is expected to grow at a compounded annual growth rate of 25 per cent between FY'2011 to FY'2013. 

The overall ad spend in the country across all media is Rs 38,598 crore as of 2013 with a year-on-year growth rate is 12 per cent, with television accounting for 44 per cent of the spend. 

"The gradual increase in adaptation of Internet has opened the door to the marketers to go online and spend on digital advertisement. With mobile devices becoming a predominant mode of Internet access among the users in India, this number is expected to increase (further)... 

"Although traditional media still holds strong ground in the Indian ad space, digital advertising is catching up fast and is expected to overtake traditional media within the next 5-10 years," Internet and Mobile Association of India (IAMAI) and IMRB International said. 

The high growth can also be attributed to increasing advertisement measurability, which is both quick and effective, it added. 

"In addition to the increasing adoption of mobile devices, the increasing connectivity and improvements in broadband infrastructure will lead to increased investments in more content rich advertisements viz video and social media advertisements," it said. 

Digital ad spend on mobile devices stood at 14 per cent, whereas on desktops and laptops at 86 per cent. 

As of June 2014, there were 243 million claimed Internet users in India out of which 192 million are active users (use Internet at least once a month). 

The growth in e-Commerce industry and their ad-spend in digital media is the highest, contributing close to 20 per cent, followed by telecom and FMCG & consumer durables. 

The digital ad spends by the e-Commerce industry has been growing at a CAGR of 59 per cent since 2011 and stood at Rs 495 crore at the end of March 2014. 

Spend by telecom stood at Rs 413 crore, followed by FMCG & consumer durables (Rs 385 crore), BFSI and travel (Rs 303 crore each). 

Currently, search and display contribute 38 per cent of the overall ad spends, followed by display ads (29 per cent) and social media (13 per cent). 

"It is estimated that the proportion of spends on search advertisements will reduce and spends will increase on email, video and mobile ads," it said.

Luxury Market

Luxury players using cinema halls, TV, newpapers to target buyers

Luxury players have started advertising through cinema halls and televisions.
Luxury players have started advertising through cinema halls and televisions.
NEW DELHI: It is unusual for a top jewellery brand, which sells super expensive items such as a Rs 50-crore necklace through auctions, to put out advertisements in cinema halls for the popcorn-munching audience. But designer Nirav Modi's namesake jewellery label does exactly that recently. 

"Be it someone who earns Rs 5,000 or Rs 5 crore a month, everyone watches films in India. It is a great way to reach out to a larger set of potential buyers," the designer reasons. "It is a great way to reach out to a larger set of potential buyers, but what you show and where has to be chosen wisely." 

Modi is one of the numerous luxury players who have started using mass media including TV, cinema, DTH and mainstream newspapers to reach out to a larger set of audience and open new areas of growth, rather than limiting themselves to the glossy sheets of lifestyle magazines and airport billboards. 

A host of luxury brands across categories such as luxury clothing, jewellery, automobile, watches and cosmetics, including Jaguar, Bentley and Rado, have started advertising through cinema halls and televisions. 

The Collective, a multi-brand retail store chain that sells premium and luxury merchandise from close to a 100 brands in India, is contemplating tying up with DTH services providers to put out ads through the digital video recorders, while cosmetics brand Forest Essentials that markets itself as luxury ayurveda has already launched television commercials. 

"It is just a thought at the moment, but would be an interesting way to target the consumer who is not aware about the brand," said Amit Pandey, marketing head for The Collective. 

He is of the view that experimenting with mediums new to luxury brands was an investment for the future. "The view is that a lot of wastage happens on mass media, but with so much new money in India, there is a huge opportunity to tap the new consumers," he said. 

The luxury market in India is still minuscule and so is advertising spend by luxury brands. Estimates suggest that in China, luxury brands contribute around 10% to the total media spending, while in India it is hardly 0.5%. 

That seems to be changing though. 

Innovative campaign

Innovative campaign: HUL gets Mumbai vendors to wrap bhelpuri in leaflets featuring Pepsodent ad

HUL has tied up with around 48 bhelpuri walas across Mumbai, asking them to wrap their popular roadside snack in leaflets of Pepsodent’s campaign.
HUL has tied up with around 48 bhelpuri walas across Mumbai, asking them to wrap their popular roadside snack in leaflets of Pepsodent’s campaign.
MUMBAI: When Vishal Thakkar bought four packets of bhelpuri from a roadside vendor in Mumbai late last month, they all came wrapped in similar green colour papers with children's drawings and messages about brushing teeth and fighting germs, bringing a smile to his face. Only when he found the same eye-catching design on the paper cone in his next 'chaat outing' did Thakkar realise it wasn't a coincidence. 

It was part of a marketing campaign by Hindustan Unilever for its oral care brand Pepsodent. India's largest consumer products firm has tied up with around 48 bhelpuri walas across Mumbai, asking them to wrap their popular roadside snack in leaflets of Pepsodent's campaign about fighting germs and brushing twice a day. 

"The idea was, 'how can we spread the oral care message to adults in a manner that is relevant for them?' Bhel is a popular evening snack and that is the time to tell adults to brush twice a day," said Atul Sinha, category head for oral care at HUL. Marketing experts say such initiatives create a bigger impact than promoting brands through paid media channels. 

"At a very low cost, you get high recall and people talk about it. So the engagement quotient is high too," said Alpana Parida, president at brand strategy firm DY Works. She considers HUL's initiative as part of 'earned media', which means creating a buzz by virtue of your own action.This is not the first time HUL has come up with such an innovative idea to take its message directly to consumers. 

A year ago, at the Kumbh Mela, it stamped 'Did you wash your hands with Lifebuoy?' message in Hindi onto millions of rotis in a campaign that was awarded the Grand Effie as well as Bronze Lion at Cannes earlier this year. 
Innovative campaign: HUL gets Mumbai vendors to wrap bhelpuri in leaflets featuring Pepsodent adLast year, Coca-Cola came out with its 'Small World Machines' campaign that allowed consumers in a mall in New Delhi to interact with those in a mall in Lahore through high-tech Coca-Cola vending machines with 3D touchscreen, and it followed it up with a commercial with visuals of some of these interactions. 

HUL started its Pepsodent campaign about brushing twice a day early last year. It teamed up with over 1.5 lakh kids across schools who expressed their creativity through paintings to promote the message. The leaflet distributed through bhelpuri walas carries one of these paintings. 

Now, HUL plans to launch an advertisement based on the whole campaign, from tying up with schoolchildren to using the leaflets for wrapping bhelpuri. The company plans to launch this commercial digitally before airing it on television, hoping that it will go viral. 

Hindustan Unilever has been trying to improve its share in the Rs 6,000-crore oral care market, which is dominated by Colgate with market share of 54.3%. HUL is a distant second with roughly 24% share. The sector is seeing increased competition and aggressive advertising spends, especially after the entry of Procter & Gamble.

Friday, 12 September 2014

practice questions micro economics

1.A survey indicated that chocolate is Americans’ favorite ice cream flavor. For each of the following, indicate the possible effects on demand, supply, or both as well as equilibrium price and quantity of chocolate ice cream. a. A severe drought in the Midwest causes dairy farmers to reduce the number of milk-producing cattle in their herds by a third. These dairy farmers supply cream that is used to manufacture chocolate ice cream. b. A new report by the American Medical Association reveals that chocolate does, in fact, have significant health benefits. c. The discovery of cheaper synthetic vanilla flavoring lowers the price of vanilla ice cream. d. New technology for mixing and freezing ice cream lowers manufacturers’ costs of producing chocolate ice cream.

2. Show in a diagram the effect on the demand curve, the supply curve, the equilibrium price, and the equilibrium quantity of each of the following events.
a. The market for newspapers in your town
Case 1: The salaries of journalists go up.
Case 2: There is a big news event in your town, which is reported in the newspapers.
b. The market for St. Louis Rams cotton T-shirts
Case 1: The Rams win the T 20 contest
Case 2: The price of cotton increases.
c. The market for burgers
Case 1: People realize how fattening burgers are.
Case 2: People have less time to make themselves a cooked breakfast.
a. The market for the economics text book
Case 1: Your professor makes it required reading for all of his or her students.
Case 2: Printing costs for textbooks are lowered by the use of synthetic paper.
3.If the demand and supply curve for computers are:
D = 100 - 6P, S = 28 + 3P
where P is the price of computers, what is the quantity of computers bought and sold at equilibrium.
4. The quantity demanded of Good Z depends upon the price of Z (Pz), monthly income (Y), and the price of a related Good W (Pw). Demand for Good Z (Qz) is given by equation 1 below: Qz = 150 - 8Pz + 2Y - 15Pw
Find the demand equation for Good Z in terms of the price for Z (Pz), when Y is $50 and Pw = $6.
5. Find the slope of an assumed linear demand curve for theater tickets, when persons purchase 1,000 at Rs5.00 per ticket and 200 at Rs15.00 per ticket.
6. Given the following data:
WIDGETS P = 80 - Q (Demand)
P = 20 + 2Q (Supply)
Given the above demand and supply equations for widgets, find the equilibrium price and quantity.



difference between inferior goods and giffen goods

In economics, a giffen good is an inferior good with the unique characteristic that an increase in price actually increases the quantity of the good that is demanded.  This provides the unusual result of an upward sloping demand curve.

This happens because of the interactions of the income and substitution effects.  Depending on whether the good is inferior or normal, the income effect can be positive or negative as the price of a good increases.  Imagine an inferior good being Top Ramen (an inexpensive noodle dish, common among students).  As your income rises, you actually consume less Top Ramen, because you may begin to buy more spaghetti, or steak, or something you enjoy more than Top Ramen.  But if you lose your job, and your income goes down, you will consume more Top Ramen, because it is inexpensive.

Next we have to consider the substitution effect.  No matter type of good, the substitution effect will be negative as the price of that good goes up.  So if the price of Top Ramen rises, the substitution effect will dictate that you will buy more spaghetti, or steak because that good has become relatively cheaper.

The interesting thing about a giffen good, is that when the price of a giffen good rises, the income effect is greater than the substitution effect.  So if a good is inferior, the income effect will be positive and larger than the negative value from the substitution effect.

Summary:  if a good is inferior, a drop in income (represented by a price increase) increases the quantity of the good that is demanded.  The substitution effect is negative for any good that experiences a price increase.  A giffen good faces an upward sloping demand curve because the income effect dominates the substitution effect, meaning that quantity demanded increases as price rises.



However, a good cannot have an upward sloping demand curve forever, because eventually the consumer will run out of money.  Remember that giffen goods have to be inferior goods, which implies that the consumer purchasing them has little money to begin with.  At some point, the rising price of the giffen good takes over the consumer’s entire budget, and a price increase will actually lower the amount of the good the consumer is able to buy.  This means that at high enough prices, we will see the traditional downward sloping demand curve.

Let’s go through an example of a giffen good, using potatoes and steak as the choice set of the consumer.  Imagine the consumer has a budget of $30, and the cost of a potato begins at $0.50 and the price of a steak is $10.00.  Also consider that the consumer needs to buy meals for 10 days.

With the original budget and prices, the consumer may choose to consume 2 steaks, at $20, and 20 potatoes for $10 over this time frame to use up their entire budget.  This is a satisfactory amount because they will have on average 2 potatoes a day, and 2 steaks over the period.

Now imagine a price increase of potatoes to $1 each.  The consumer could still buy 2 steaks, but could now only buy 10 potatoes.  This might leave them hungry, so it is possible they will buy less steak, and more potatoes in order to get their calories.  This means that 20 potatoes will still be purchased, but now only 1 steak is purchased.

If the price of a potato increased again, say to $1.25, then the consumer would only be able to get 16 potatoes for $20, which may not be enough calories to survive.  They will decrease their steak consumption by one, and use that money to buy more potatoes in order to get the necessary energy.  In this example, potato consumption would rise to 24 ($30/$1.25) and steak consumption would drop to zero.  This shows how consumption of a good would rise with a price increase (thus an upward sloping demand curve).

At this point, the consumer’s entire budget is taken up by the giffen good, so any price increase now will result in a decrease of the amount of good the consumer is able to buy.  Thus, we will have our typical downward sloping demand curve.

Monday, 8 September 2014

Theory of Consumption - Indifference Curve Analysis - Substitution Effect


Meaning: When there is a change in the price of one commodity, and when the price of another commodity remains unchanged or constant, the income of the consumer must be changed in such a way that the consumer is neither better off nor worse off. He remains at the same old position. Under that circumstance, if there is a change in the consumption, that would be due to the Substitution Effect.

Equilibrium: We can find out the equilibrium position of the consumer in the following diagram.

In the above diagram AB is the original price or budget line. T is the original equilibrium position. There is a fall in the price of X. So the new budget line is AC. To put the consumer at the same old position we draw another budget or price line DE, which will meet the indifference curve at the point T1. So the movement from T to T1 on the indifference curve IC shows the substitution effect. Here the consumer substitutes n->n1 of Y to get m->m1 more of X because the price of X is now comparatively cheaper than the price of Y.