Advertising and Sales Management (English Version)-munotes

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INTRODUCTION TO ADVERTISING
Unit Structure
1.0 Objective
1.1 Introduction
1.2 Concept and Features of advertising
1.3 Significance of advertising
1.4 Classification of advertising
1.5 Elements of Integrated Marketing Communication (IMC)
1.6 Behavioural Model (E.K. Strong AIDA)
1.7 DAGMAR Model (Russel Colley)
1.8 Hierarchy of Effects (Lavidge and Steiners)
1.9 Summary
1.10 Exercise
1.11 References
1.0 OBJECTIVE After studying this unit the student will be able to
 Understand concept and features of ad vertising
 Explain significance of advertising
 Describe classification of advertising
 Discuss the elements of IMC
 Relate AIDA model, DAGMAR model and Hierarchy of effects
model with real life
1.1 INTRODUCTIO N Marketing mix includes: Product, Price Promotion and Place. Advertising
is an element of Promotion mix. The term advertising is derived from the
Latin word „advertere’ which means „ to turn the mind towards ‟. Every
advertising turns the attention of the people towards product. The
dictionary meaning of t he term advertising is „to give public notice or to
announce publicity.‟
Advertising is a communication tool through which marketer / advertiser
creates awareness about their new product / services and reminds about
existing product / services to their ta rget customers. It also persuades
customers to buy the product. Advertising has also been an effective tool
to create awareness about the social issues among the general public such munotes.in

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2 Advertising and Sales Management
2 as drive safely, precautions during spread of diseases, cleanliness,
consu mer rights, save girl child etc.
In the ancient and medieval time, the advertising was conducted by word
of mouth. The first step toward modern advertising came with the
development of printing in the 15th and 16th centuries. In the 17th century
weekly newspapers in London began to carry advertisements, and by the
18th century such advertising was flourishing.
In 19th century the great expansion of business was accompanied by the
growth of an advertising industry. In this century, primarily in the United
States, advertising agencies were established. The first agencies were, in
essence, brokers for space in newspapers. But by the early 20th century
agencies became involved in producing the advertising message itself,
including copy and artwork. By 1920s agencies had come into being that
could plan and execute complete advertising campaigns, from initial
research to copy writing to placement of ad in various media.
Advertising developed in a variety of media. Perhaps the most basic was
the newspaper, offering advertisers large circulations, a readership located
close to the advertiser‟s place of business, and the opportunity to alter
their advertisements on a frequent and regular basis. Magazi nes, the other
chief print medium, may be of general interest or they may be aimed at
specific audiences. It offered the chance to the manufacturers of products
to make contact with their most likely customers. Many national
magazines publish regional edit ions, permitting a more selective targeting
of advertisements. In Western industrial nations television
and radio became the most pervasive media. Advertisers are able to buy
short “spots” of time, usually a minute or less in duration. Advertising
spots are broadcast between or during regular programs, at moments
sometimes specified by the advertiser and sometimes left up to the
broadc aster. The other advertising media include direct mail, which can
make a highly detailed and personalized appeal;
outdoor billboards and poste rs; transit advertising, which can reach the
millions of users of mass -transit systems ; and miscellaneous media,
including dealer displays and promotional items such as books or
calendars
In th e 21st century, with an intensely competitive consumer market,
advertisers increasingly used digital technology to call greater atten tion to
products. In 2009, for example, the world‟s first video advertisements to
be embedded in a print publication appeared in Entertainment
Weekly magazine . The thin battery -powered s creen implanted in the page
could store up to 40 minutes of video via chip technology and
automatically began to play when the reader opened the page.
(Britannica.com)

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3 Introduction to Advertising 1.2. CONCEPT AND FEATURES OF ADVERTISING According to American Marketing Association “Any paid form of non-personal presentation and promotion of ideas, goods and services by an identified sponsor.” According to William F. Arens Advertising is the structured and composed non-personal communication of information, usually paid for and usually persuasive in nature, about products (goods, services and ideas) by identified sponsors through various media.”

1.2.1 Features of Advertising :
1. Process:
Advertising is a systematic process which includes:
 Planning of ad campaign: It includes pl anning related to ad
message, budget, theme, frequency, time and area of ad.
 Preparation of ad: It includes preparing ad campaign by considering
nature of product, target audience, competition, etc.
 Placing the ad: It includes decision relating to placing of ad
campaign in the appropriate media after it is ready.
2. Paid/Controlled Form:
Ad is a paid form of communication. It is not free of cost. The advertiser
has to pay for time and space used in media.
It is also controlled form because the advertiser pays for the ad, so he has a
control over the content of the ad. He can change the content as he wants.
3. Non-Personal Promotion:
Ad is non -personal promotion because there is no face to face
communication between advertiser and audience. It is one way
communication where in ad campaign provides information about product
and the audience can only watch it or listen it or read it. There is no scope
for audience to ask questions or get their queries solved.
But nowadays due to digital media it is also poss ible for audience to ask
questions and get their queries solved from the advertisers. munotes.in

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4 4. Ideas, Goods and Services:
Advertising is not only undertaken for the promotion of goods and
services but it is also undertaken for promoting ideas.
 Goods: It include s promotion of any tangible thing such as detergent
powder, soap, vehicles, cold drinks, electronic items, clothes, etc.
 Services: It includes promotion of any intangible thing such as banks,
insurance, transport, communication etc.
 Ideas: It includes crea ting awareness about social issues such as ad
campaigns like save girl child, cleanliness and sanitation, awareness
about AIDS and cancer, polio, consumer rights etc. which is generally
undertaken by Government and NGOs in the interest of society.

5) Identified Sponsor:
The sponsor of the ad is the advertiser. Identified sponsor means that the
advertiser should be known through the advertised message. The sponsor
identifies himself by:
 Brand name: such as Lux, Liril, Pears etc.
 Corporate Name: such as Go drej, Bajaj, State Bank of India etc.
6) Art, Science and Profession:
Advertising is an art as it requires creativity in convincing and
communicating about product / services to the target customers.
Advertising is a science because it is a systematic pr ocess which includes
planning of ad campaign, preparing ad campaign and placing of ad
campaign. The ad campaign is prepared step by step.
It is also considered as a profession because it offers career opportunities
in the field of advertising. One can work in ad agency or make career as
freelancing. munotes.in

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5 Introduction to Advertising 7) Element of Promotion -mix:
Marketing mix includes: Product, Price, Promotion and Place. Promotion -
mix includes Advertising, Publicity, Sales Promotion, Salesmanship,
exhibition, packaging, public relation etc . So the advertising is an element
of promotion -mix.
Advertising supports other elements of promotion -mix. Eg. Advertising
helps to create awareness about sales promotion schemes (discount,
exchange offer, combo offer etc.) of the company among target aud ience.
Also advertising makes job of salesman easy.

8. Influences Diverse Group:
Ad does not only influence customers. It also influences employees,
shareholders, intermediaries and the society at large. Due to effective ad
campaign not only customers are attracted towards offering of company
but also company can attract talented and competent manpower,
shareholders invest into company, intermediaries (wholesaler and
retailers) are ready to stock products of company in their shop. So this way
the adver tising influences different stakeholders.
9. Creativity:
Creativity is the essence of ad. Without creativity ad will be unnoticed. It
is rightly said that without creativity, ad is just like a body without a soul.
The creative team of ad agency put in lo t of creativity in the ad campaign
to make the ad look apart from other ads. Creativity not only attracts
attention of audience but also helps to remember the ad for longer period
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10. Objectives of Ad:
Ad is undertaken to achieve certain object ives such as:
 To create awareness about product/services
 To develop positive attitude about product/services
 To enhance brand image
 To improve corporate image
 To face competition
11. Universal Usage:
Ad is not only undertaken by commercial organizations s uch as HUL,
P&G, Godrej etc. but it is also undertaken by non -commercial
organizations such as social organizations, Government, NGOs,
Schools/Colleges etc. Eg. Ad campaign is undertaken by Election
Commission of India to appeal citizens to exercise their vote during
election. Ad campaign is also undertaken by NGOs / Social organizations
for social cause.
12. Target Audience:
Everything cannot be sold to everyone. So advertiser needs to select target
audience and direct ad message to them. Eg. Vim bar ad i s targeted
towards housewives so the kitchen with utensils to wash is shown in the
ad campaign. A thump up ad is targeted towards youth so the stunts are
performed to get a bottle of Thumps up is shown. So these ads are
prepared keeping in the mind their t arget audience. munotes.in

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1.3 SIGNIFICANCE OF ADVERTISING

A) Significance to Business Firm :
1. Introduction of New Product:
Through Ad, information about new products/services is given to the
target audience. This generates demand for new products/services. Eg.
Trivago, Indulekha Hair Oil, Urban Company etc. were introduced to
target audience due to advertising campaign.
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8 2. Modifies Attitude:
When product is new, people may have neutral attitude towards such new
products. They may be confused whether to buy s uch new product or not.
But effective ad campaign helps to convert this neutral attitude into
positive one. Eg. New products / services such as Trivago, Indulekha Hair
Oil, Urban Company are accepted by customers within short period of
time due to their ef fective ad campaigns.
Consumers may develop negative attitude towards a particular brand due
to its negative publicity. But through effective ad campaign the advertiser
may clear the doubts of the audience and their negative attitude can be
converted into positive one. Eg. Cadbury Dairy Milk, Maggi, Pepsi etc.
had developed negative attitude. But these advertisers had undertaken ad
campaign in which they communicated people about their corrective
action taken and gave confidence to people about quality of product. Due
to which these brands have regained their brand image and customers have
accepted them again.

3. Builds Image / Brand Image:
Brand image refers to creating image of the product/service in the mind of
customers. Effective ad develops brand image of product/service in the
mind of the target customers. Eg. Head and Shoulder – Get rid of
dandruff. So when we think about dandruff, image of Head and Shoulder
comes in our mind. In the same way Harpic Bathroom Cleaner – Kills
99.9% germs. When we t hink about bathroom cleaner, image of Harpic
comes to our mind. This is possible due to their effective ad campaigns.
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9 Introduction to Advertising 4. Builds Loyalty / Brand Loyalty:
Brand loyalty refers to:
 Repeat purchase of product by existing customers
 Recommendation of product t o others by existing customers.
Advertising creates brand image of product in the mind of customers and
customers buy the product again and again and recommend others to buy
it. So effective ad campaign helps to develop brand loyalty among the
customers to wards the product/services.
5. Market Expansion:
Effective ad campaign helps to increase sales and profitability of
company. It also attracts customers of different areas. So the advertiser
can expand their market from local level to regional level to n ational level
to international level.
6. Corporate Image:
Effective ad campaign not only develops brand image in the mind of
customers but also builds image of the firm / company (corporate image)
in the mind of stakeholders (shareholders, customers, empl oyees,
intermediaries etc.). Corporate image can be built through institutional
advertising wherein name of the firm/company is highlighted in the ad.
Building corporate image is necessary to get support from stakeholders.
Because when corporate image is b uilt shareholders invest into company,
customers buy the product, suppliers supply good quality material and
give extended credit period, intermediaries are ready to stock products in
their shop and company can attract competent manpower. Eg. Ad
campaign o f L&T, Godrej, HUL etc. emphasizes on developing corporate
image of the firm.

7. Improvement in Quality:
Effective ad campaign helps to increase sales of company which leads to
increase in profitability of the firm. Some part of profit is used for
impro vement in the quality of product like purchasing modern machinery, munotes.in

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10 training employees, research and development activity etc. Due to which
the firm/company is able to offer good quality products to the company
which results into customer satisfaction.
8. Facing Competition:
Today, markets are flooded with products. There exists cut throat
competition in all product categories. Continuous ad is essential to retain
the existing customers and attract new ones. So advertising is an effective
tool to face the c ompetition and survive in the market.
9. Increased sales:
Ad plays an important role in influencing customers to buy the product.
As a result, sale of the company increases.
10. Economies of Scale:
Ad increases demand for the product. As a results produc tion and
distribution activities are undertaken on large scale. So the firm purchases
raw material on large scale and they get discounts. They also save on
transportation cost. So there is saving of cost due to large production and
transportation.
B) Signi ficance to Consumers :
1) Better Quality Products:
Advertising intensifies competition. So to survive in cut -throat
competition, producers make every possible effort to improve quality of
products. This puts consumers in advantage of getting good quality
products.
2) Lowers Product Prices:
The firm is able to get benefit of economies of scale wherein the firm is
able to save its cost on production and transportation. The part of its
saving can be passed on the consumers in the form of discounts and
reduct ion in price. So customers are not only getting better quality goods
but also at lower price.
3) Higher Standard of Living:
As discussed in above points that due to advertising the company is able to
offer better quality goods at lower price to its custom ers. Therefore, the
customers enjoy higher standard of living (because they are using better
quality goods). This is due to customers are able to buy quality goods
because it is available at lower price.
4) Consumer Satisfaction:
Again due to advertising, consumers get better quality products at lower
price. This increases their satisfaction level and they are happy. Due to munotes.in

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11 Introduction to Advertising advertising, these days customers are well informed about quality and
price so they expect only better quality goods and within their budget.

5) Information:
Advertising provides information to consumers about price, availability,
use, benefits and side effects/limitations of product. There are websites
where customers can compare the various products on the basis of
benefits, price, features etc. Accordingly customers can make their
informed purchase decision.
6) Education:
Advertising also educates to consumers about their rights, consumer
courts, malpractices by marketers (such as black marketing and
adulteration) social issues, et c. This increases awareness of customers
about market practices and protects them from exploitation.

7) Reminder:
The ads remind to consumers of their requirements, so they can plan their
purchases well in time. Eg. the arrival of a particular season such as
Diwali is often shown in ads. This reminds the consumers to make
purchase for the festival season. Likewise, ad of Boroplus is shown in
winter season, which reminds customers to buy Boroplus lotion to
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8) Saves time in shopp ing:
Advertising informs the place / store where the goods/services are
available. Their customers need not to waste his time in searching for the
store. Eg. Ad of Movies in newspaper or Bookmyshow.com site provides
information about names and location of theatres where movie is currently
screened. Accordingly, customers can travel to that theatre and watch
movie.
1.4 CLASSIFICATION OF ADVERTISING

I) On the basis of Geographic Area :
1) Local Advertising:
It includes undertaking an ad campaign for the lo cal people to buy
products from a particular shop or a local establishment. It is mostly
preferred by retailers. Such ads are undertaken in the form of hoarding and
posters or ad in local newspapers and magazines. Local cable network is
also used. The ad o f departmental stores like Shopper‟s Stop, Big Bazaar
and also ad of coaching classes, bakery, cinema house etc. are examples of
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2) Regional Advertising:
It includes undertaking an ad campaign to cover a specific region which
could b e one state or an area covered by people speaking one language. It
is preferred by manufacturers and regional distributors, of the product.
Such ads are undertaken in the form of radio and TV (regional channels),
newspapers and magazines and outdoor media is also used to reach the
target audience. The ad of Spices, books, clothes etc. are examples of
regional advertising.

3) National Advertising:
It includes undertaking an ad campaign which covers entire nation. It is
preferred by manufacturers of consum er products. Such ads are
undertaken in the form of national media such as TV, radio, newspaper,
social media etc. Hindustan Unilever, Reliance Industries, Godrej, Tata,
Bajaj etc. are some leading advertisers who advertise at the national level.
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14 4) International / Global Advertising:
It includes undertaking an ad campaign which covers a number of
countries. With the advent of satellite TV, international ad campaigns are
seen by people in different parts of the world. It is undertaken in order to
induce the global buyers to buy the products. Such ads are undertaken in
the form of TV, magazines, social media, internet etc. Since MNCs
operate at global level, they need such ads. Coca -Cola, Colgate, Sony etc.
are some leading advertisers at global level.

II) On the basis of Media :
1) Print / Press Media Advertising:
It includes undertaking an ad campaign in print media such as newspapers,
magazines etc. Detailed information about the product can be given in
print ad. Further, it also has a reference valu e. It is one of the most
economic and effective methods of ad. Print ad has gained more
popularity these days due to improvement in the quality of paper and
printing technology.

2) Broadcasting Media Advertising:
It refers to ad on broadcasting media s uch as radio and television.
 Radio ad takes the form of spot announcements and sponsored
programmes. It may be in the form of commercial songs, dialogues
with short skits, opinions of famous personalities such as film stars, munotes.in

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15 Introduction to Advertising sports stars etc. Radio ad has audio impact. The radio jingles are quite
popular and help to sell the products.
 Television is extensively used for ad. It is the form of short
commercials and sponsored programmes. It offers benefit product
demonstration. TV ad offers both audio -video im pacts.

3) Outdoor Media Advertising:
It includes undertaking an ad campaign on posters, banners, neon signs,
transit ad, Point of Purchase (POP) ad etc. It is an excellent form of
reminder ad. It is more effective for local ad.

4) Internet Media Adv ertising:
Internet is growing ad media in the present era. Use of World Wide Web
is made to advertise. Different types of internet ad includes ad banners,
websites, interstitial, email ad, search based ad and so on. One major
benefit of internet ad is the immediate publishing of information that is not
limited by geographic or time constraints. Online ads can be customized
ads, making consumer targeting more efficient and precise. munotes.in

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III) On the basis of Target Audience :
1) Consumer Advertising:
This is t he most common form of ad. It is aimed at the ultimate consumer.
It not only attracts the attention of consumers but also persuades them to
buy the product. Such ad is undertaken through mass media like
television, newspapers, magazines, internet etc. Thes e ads are designed for
the general public and so technicalities are avoided while designing the
ads. Consumer ads promote the sale of consumer goods such as soaps,
detergents, powders, cosmetic, toothpaste, motor cycles, refrigerators,
music system, furnit ure items etc.

2) Industrial Advertising:
This type of ad is used by manufacturers and distributors of industrial
goods such as machinery, equipments, spare parts and components,
fabricated materials etc. It designed for businessmen / industrial
custome rs. Such ads usually appear in trade publications. Other media munotes.in

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17 Introduction to Advertising used include business magazines, direct mail, trade fairs and exhibitions
etc.

3) Trade Advertising:
Trade ad is directed towards channel of intermediaries such as wholesalers
and retailers who are involved in the distribution process. It aims at
persuading and motivating intermediaries to stock the products of the
advertiser. Ads inviting dealership for a particular are the common forms
of trade advertising. Trade journals, brochures, direct mail, commercial
press etc. can be used for trade advertising.

4) Professional Advertising:
Ad which is targeted towards professional groups such as doctors,
lawyers, teachers, architects etc. is called professional ad. It is undertaken
by manufacture rs and distributors who depend on these professionals to
endorse their products to the ultimate consumers. Products like medicines,
building material and books are generally purchased by users on the
recommendation of doctor, architects and teachers respec tively. These ads
can be technical in nature. Professional journals and magazines are used
for such type of ad. Personal selling also plays important role here. Eg.
Medical Representatives (MR) approach to doctors along with samples of munotes.in

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18 medicines and convin ce them to recommend their medicines to the
patients.

IV) On the basis of Functions:
1) Direct Action and Indirect Action Advertising:
Direct Action Advertising:
Ad designed to obtain some immediate response from the target customer
is called direct ac tion ad. All sales promotion ads are direct action ads.
Discount sale ad, free gift offers, exchange offers, premium offers etc. are
examples of direct action ad. Here the focus of advertiser is on increasing
sales of their product.

Indirect Action Adve rtising:
This ad is designed to influence the target audience to have a favourable
image of the brand advertised. Such ads induce buyers to prefer the
advertiser‟s brand over the competitor‟s brand. Here the advertiser munotes.in

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19 Introduction to Advertising compares his products and highlights superiority of his product over
competitor‟s product.

2) Primary Advertising and Selective Advertising:
Primary Advertising:
This is also called generic ad. It is intended to affect the demand for a type
of product and not of a particular brand. It ed ucates the consumer about
the benefits of an entire product class. It is undertaken by trade
associations or co -operative groups without referring to their specific
brand name. For Eg. Sunday hoya Monday roj khao anday! - Ad
campaign by National Egg Coordi nation Committee. In this ad name of
any brand is not highlighted. Here advertiser focuses on informing
consumers about benefits of consumption of egg (a product class) during
summer.

Selective Advertising:
It is intended to promote an individual manuf acturer‟s brand rather than a
generic product. It is aimed at stimulating demand for a particular brand
such as TATA Tea, Surf Excel washing powder, Videocon television,
Hero Honda bike, Titan watches etc. Most of the ads fall under this
category. The main purpose of this ad is to make the specific brand
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3) Product Advertising and Institutional Advertising:
Product Advertising:
When the manufacturer / retailer advertises to promote the sale of his
products or services by pr omoting specific brands, it is called product ad.
Most ads are product ads. It may emphasize on the product itself or on the
some of its features such as price, quality, uses etc. Eg. Ad of Tide,
Kwality Walls, Garnier etc.

Institutional Advertising:
It attempts to promote a „corporate image‟ by creating a favourable image
of the company in the minds of general public. In such a case, the
company name is used as a focus point in ad. It is undertaken by big
business houses. Eg. L&T, TATA, Reliance etc. munotes.in

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1.5. ELEMENTS OF INTEGRATED MARKETING COMMUNICATION (IMC) Concept of Integrated Marketing Communication (IMC) :
Integrated Marketing Communications (IMC) is the process of integrating,
coordinating and combining the various marketing and promotional
elemen ts to deliver the same and consistent marketing message across
customers and channels. IMC can combine different channels like email,
social media, TV, print etc. and different methods like advertising, direct
marketing, sales promotion, PR etc.
IMC makes sure that irrespective of the delivery channel, the message and
positioning does not change. The basic IMC tools used to accomplish an
organization‟s communication objectives are referred to as the
promotional mix.


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22 Definition:
According to William Sta nton “as the element in an organization‟s
marketing mix that is used to inform, persuade and remind the market
regarding the organization and/or its products.
The American Association of Advertising Agencies define IMC as “a
comprehensive plan that e valuates the strategic roles of a variety of
communication disciplines and combines these disciples to provide clarity,
consistency and maximum communication impact
Examples of Integrated Marketing Communications :
1) Uber launched an integrated marketing campaign which uses
integrated marketing communications that is solely based on the
theme of togetherness. A multi -platform campaign was rolled out with
Facebook and YouTube as primary channels and television for
broader air coverage and radio for the audi ence while commuting.
2) Coca Cola launched „Open Happiness‟ campaign through a very
catchy TV commercial. The company ensured that other
communication channels like social media, print, online ads, outdoor
media etc. were also used effectively. This show s the overall use of
IMC channels to capture people across media channels.
Elements of Integrated Marketing Communication (IMC) :
1) Advertising:
Ad is a paid form of non -personal presentation and promotion of ideas,
goods or services by an identified spon sor. This is often the most
important part of marketing communications. The paid aspect means that
the space for an advertising message generally has to be bought. The
advertising is done through media such as newspaper, magazines, radio,
TV, catalogues, d irect mail, hoardings, internet, mobile phones etc.
Objectives of advertising are:
 To create awareness about new product/services
 To develop positive attitude towards product/services
 To enhance brand image
 To improve corporate image
 To face competition
2) Publicity:
Publicity is also a way of mass communication. It is not paid form of
promotion. Publicity comes from reporters, columnists, and journalists.
Publicity involves:
 Giving interviews, munotes.in

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23 Introduction to Advertising  Conducting seminars,
 Offering charitable donations,
 Inaug urating mega events by film actors, cricketers, politicians, or
popular personalities,
 Arranging stage show, etc.
That attracts mass media to publish the news about them.
3) Sales Promotion:
It includes various techniques that are used to increase sales of goods and
services. These techniques include:
 Discount Coupons
 Free Samples and free gifts
 Exchange offers
 After -sales Service
 Combo Offer
 Guarantees or warranties
 Contests
Objectives of Sales promotion activities are:
 To introduce new products
 To attract new customers and stimulate demand
 To increase sales during slack (non -season) periods
 To counter sales promotions campaign of competitor etc.
4) Public Relations (PR):
PR is concerned with maintaining rapport with different groups such as
employees, customers, suppliers, investors, government and so on. It
focuses its attention on evaluating public attitudes and opinions about an
organisation‟s policies, procedures, and action. It is the development of
rapport, goodwill, understanding and ac ceptance through a two way
communication. The heart of public relations is not to sell product, but to
produce a favourable image of a company and improve it, if necessary.
5) Direct Marketing:
It is a system of marketing by which organizations directly communicate
with the target customers to generate a response or transaction.
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24 It includes traditional direct methods such as Yellow Pages, Direct -mail
(sending sales letters, brochures, catalogue s to target customers), Door -to-
door calling etc. The modern direct marketing methods include
Telemarketing, Direct radio selling, Magazine and TV advertising, Online
shopping etc. Companies like Amway, Tupperware, Dell Computers and
Gateway have been succ essful in direct marketing.
6) Personal Selling / Salesmanship:
Personal selling or salesmanship is the oldest and the most popular method
of selling goods and services. It refers to the presentation of goods and
services before the customers and convinc ing or persuading them to buy
the products or services. It involves face -to-face interaction between the
sellers and the potential buyers. The approach of personal selling is
always flexible. Looking into the situation and interest of the customers,
the a pproach of the salesman is decided instantly. Personal selling is of
two types:
 Across the counter selling : where customer goes to the salesman
(into the shop)
 Door -to-door selling : where salesman goes to the customers.
7) Sponsorship:
A firm may sponsor sports, cultural and social events to create a distinct
image for the organization and its brands. Sponsorship is undertaken for
the following purpose:
 To familiarize the name of a brand or company
 To reinforce corporate identity
 To attract media interest
8) Trade fairs and exhibitions:
A trade fair and exhibition is where companies in a specific industry can
showcase and demonstrate their latest product. Trade fairs provide a
platform for companies to meet industry partners and customers and
examine mark et trends and opportunities. It provides unique networking
platform to the participants. Objectives of participation in trade fair and
exhibition includes:
 Demonstration of the product
 Studying the activities of competitors
 Establishing contacts with poten tial buyers
 Understanding recent market trend and opportunities

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25 Introduction to Advertising 9) Packaging:
A properly designed package can influence and induce the prospects to
buy the product. Packaging plays important roles such as:
 Providing information of the product
 Protecting of goods while transporting and handling
 Preservation of quality of the product
 Promotion of the product
1.6 BEHAVIOURAL MODEL (E.K. STRONG AIDA) The AIDA model is one of the basic but crucial models used to develop
effective advertising and marketing cam paigns. The AIDA Model
identifies cognitive stages an individual goes through during the buying
process for a product or service. AIDA is an acronym which stands for:

Stages of AIDA Model :
1) Attention:
The attention stage is the most underrated stage of the AIDA model. This
is the stage where the brand creates awareness and attracts the attention of
its potential customers. It is the first interaction between the brand and the
customer. The existence of a brand does not mean that the customers will
know about it. The brands have to ensure they are making themselves
visible to the customers. For this, they may take the help of traditional
techniques like print advertisements or TV, Radio advertisements as well
as social media handles like Instagram and T witter is also crucial to get
the attention. For example, many customers were unaware of CRED.
CRED was founded in 2018 but people started recognizing it in 2021
when they made small advertisements with icons from the 90s. The most
famous one was the one w ith Rahul Dravid and his famous ad
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26 Advertising and Sales Management
26 2) Interest:
After the attention stage, comes the interest stage. Here communication is
the key. It is extremely important that the message from the brand about
their products and services is cris p and to the point. It should be formed in
such a way that the consumer should be eager to start their research about
this product. The message should encompass all that conveys to the
consumer that their needs will be fulfilled and how the brand plans to
fulfill them. For example: In all the advertisements shown by CRED they
had a very simple message - “Download CRED and get a reward for
paying your bills.” They spoke about their product and conveyed that
rewards will be given if you pay your credit card bi lls. This simple
message created a buzz and ensured that consumers went on to read about
CRED and what this app offered.
3) Desire:
After the attention grabbing and Interest generation comes the desire
stage. This is the stage when brands have to be very careful. Here the
brand should take the opportunity to highlight the benefits or the Unique
Selling Proposition (USP) of the product or service. What is that the brand
is offering which is unique to them? For Example, CRED offers cred coins
that can be use d to earn rewards and cashback. They also use the tagline -
“It pays to be good.” This creates the desire to download the app as the
customers are now understanding how exactly CRED will benefit them
and what they will get here which they will not get anyw here else.
4) Action:
Now the final stage where the customer buys the product or subscribes to
the service has come. The customer has a positive idea about the brand
and is convinced that the brand will benefit them and solve their problem.
In the case of CRED, the customer is convinced that they will benefit from
paying their credit cards bills on time if they do it through CRED. This is
when they will download the app or register themselves. In general terms,
brands may offer discounts or early bird offe rs to customers to expedite or
confirm the buying process.
Example of brand used AIDA model successfully :
Netflix:
When Netflix came to India, the biggest problem they faced was that
Indians already had access to free and continuous content on various
platforms with the majority of houses having cable connections. Netflix
had to appeal to a new market and convince them to take up Netflix. This
is how they used the AIDA model:
1) To grab attention Netflix went the traditional way of outdoor
advertising by pl acing huge posters of shows like Narcos, Friends,
etc. They also had a few original shows under their banner like Sacred
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27 Introduction to Advertising 2) Interest was created by focusing on the youth population of India.
Customers would see the 1 monthly fre e trial on their website which
would create curiosity about other shows that were being featured on
Netflix.
3) After experiencing 1 month free trial Netflix, the desire to continue
with Netflix would become stronger with the original documentaries,
shows , multiple original web series, a large Hollywood and
Bollywood movie collection, features like support for any device,
personalized recommendations based on watching habits of viewers,
high-resolution videos and much more.
4) The action step would be achi eved when Netflix offered multiple
plans for subscriptions depending upon the pocket of the customer.
The customer at this point is hooked to all that is being offered and
converting the customer here becomes easier.
1.7 DAGMAR MODEL (RUSSEL COLLEY) The DA GMAR approach of advertising was devised by Mr. Russell
Colley. DAGMAR is a concept used in advertising to set advertising
objectives and goals. DAGMAR is an abbreviation for “Defining
advertising goals to measure advertising results”.
Russell Colley observed that although people were investing in
advertising, they had to invest a lot of time in other marketing activities to
get the Return on Investment (ROI) of advertising. This is because the
ROI from advertising was unknown.
Hence, Russell suggested 2 main ways that maximum ROI could be
achieved with the usage of Advertising a lone. Hence, a company which
was thinking of 10 different ways to market its products , could check the
ROI from advertising, when it wanted t o study how effective it‟s
advertising was.
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28 Advertising and Sales Management
28 The main objective of this model is to communicate the desired message
to the target audience. This communication task involves 4 stages.
1) Awareness :
Awareness of the product / service is required before the purchase. The
primary purpose of advertising is to improve consumer awareness about
the product.
Once the consumer is made aware of the product, it should not be
forsaken. The consumer tends to get puzzled by other competing
advertising if they get ignored .
At this stage the targeted audience becomes aware about the brand /
product. The objective of advertiser is to make people aware about
the brand / product.
2) Comprehension :
Awareness is not sufficient to influence the customer for the purchase.
Knowle dge and the right understanding of the product and the company
are important. This can be done by providing information about the
company and product.
At this stage the customers get more information about the product
and understands the benefits of using product. The objective of
advertiser is to provide information about the product.
3) Conviction :
At this stage, a sense of conviction or faith is established, and by creating
interests and preferences, customers are convinced that a certain product
should be tried at the next purchase.
At this stage a customer evaluates different products and plans to buy
the product. The aim is to create a positive mentality to buy a
product.
4) Action
This is the last step which includes the final purchase of the product or
service by the customer. As soon as the desire to buy is generated, this
must be transferred into action i.e. the purchase. The objective is to
motivate customers to buy the product.
1.8 HIERARCHY OF EFFECTS (LAVIDGE AND STEINERS) The hierarchy of effe cts model shows how advertising influences the
decision to either buy or not buy a given product / service. The theory was
founded by two individuals Gray A Steiner and Robert J Lavidge, in 1961.
This marketing communication model, suggests there are six steps from
viewing a product advertisement till product purchase. The job of the munotes.in

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29 Introduction to Advertising advertiser is to encourage the customer to go through the six steps and
purchase the product.

Stages of Hierarchy of Effects model :
1) Awareness:
This is where the customer s come to know the existence of a product
through advertisement. It is a challenging stage because there is no surety
that the customers will become aware of the product after it is advertised.
Note that consumers come across so many advertisements every d ay. So,
they are likely to remember a very small fraction of the products brand.
2) Knowledge:
This is a stage where advertisers expect customers to gain more
information about the advertised product. It can be through product
packaging, retail advisors, and the internet. It is an important step,
especially in this digital era. Consumers are able to gain knowledge about
any product by simply clicking a button.
3) Liking:
It is a stage where advertisers have to ensure that the customers like the
product. They have to ensure that the features they promote a given
product encourage the customer to like it.
4) Preference :
There is a possibility of customers liking not just one but more product
brands, and they might end up purchasing any of them. Advertise rs need
to ensure that customers shift their focus from rival products and instead
concentrate on their product. To ensure this, it is necessary that they
highlight the benefits of their brand, including their unique selling points.
This way, customers are able to differentiate the product from the rest.
5) Convictions:
At this stage, advertisers should be able to arouse customer‟s desire to
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30 Advertising and Sales Management
30 potential buyers to test the product. If t he product is food, they can give
consumers free samples to go and try them out first. In case of a car, they
should invite customers for a car driving test. This way, consumers will
confident when they finally decide to purchase the product.
6) Purchase:
This is a stage where advertisers expect consumers to buy their products.
The step should be simple and easy to encourage customers to purchase
the product. For example, a website that is slow may discourage online
purchases. A complicated payment proces s can also make consumers shy
away from buying a product.
1.9 SUMMARY Advertising is a marketing tactic involving paying for space in the suitable
media (TV, Radio, newspaper, magazine, social media, internet) to
promote a product, service, or social cause . The goal of advertising is to
reach people most likely to be willing to pay for a company‟s products or
services and entice them to buy.
1.10 EXERCISE Fill in the b lanks :
1) The term advertising is derived from the Latin word
„___________which means „to turn the mind towards‟ .
(advertere’ , adventure, anonymous)
2) Advertising is ___________ form of p romotion of goods and services.
(Unpaid, Paid, Free of cost)
3) Advertising is an element of ________.
(Pricing, Product quality, Promotion Mix )
4) _____ ____ advertising includes undertaking ad campaign to cover a
state or an area covered by people speaking one language.
(Regional , Local, International)
5) ____________ is one of the elements of Integrated Marketing
Communication (IMC).
(Personal Selling , Pricing, Product)
True or false :
1) Advertising promotes only goods and services and does not create
awareness about social issues of the society. FALSE munotes.in

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31 Introduction to Advertising 2) Effective ad campaign helps to introduce new product in the market.
TRUE
3) Ad campaign underta ken to target professionals like doctors,
engineers, and teachers is known as trade advertising. FALSE
4) IMC stands for International Marketing Council. FALSE
5) DAGMAR model of advertising was devised by Mr. Russel Colley.
TRUE
Match the pairs : Group - A Group – B 1) Jago Grahak Jago advertisement a) An element of IMC 2) Amul Milk ad b) E.K. Strong 3) Sponsorship c) Makes consumer aware about their
rights 4) AIDA Model d) Primary Advertising 5) Sunday hoya Monday roj khao anday! e) National Advertising
(1-c, 2 -e, 3 -a, 4-b, 5 -d)
Answer in brief :
1) Explain the features of advertising.
2) Discuss the significance of advertising.
3) Briefly describe classifications of advertising with suitable examples.
4) What are the different elements of Integrated Marketing
Communication (IMC).
5) Write a note on following
a) Behavioural Model – AIDA (E.K. Strong)
b) DAGMAR Model (Russel Colley)
c) Hierarchy of Effects (Lavidge and Steiners)
1.11 REFERENCES  https://www.studentnotes.in/2021/10/dagmar -model -awareness -
comprehension -Conviction -
Action.html?utm_source=feedbur ner&utm_medium=feed&utm_camp
aign=Feed:+studentnotes/wtWg+(Student+Notes)&m=1
 https://www.marketing360.in/5 -brands -that-successfully -use-the-aida-
model/ munotes.in

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32 Advertising and Sales Management
32  https://bbamantra.com/dagmar -approach/
 https://www.marketing91.com/dagmar/

 https://www.studentnotes.in/2021/10/dagmar -model -awareness -
comprehension -Conviction -
Action.html?utm_source=feedburner&utm_medium=feed&u tm_camp
aign=Feed:+studentnotes/wtWg+(Student+Notes)&m=1
 https://thebusinessprofessor.com/en_US/advertising/hierarchy -of-
effects -theory -definition
*****
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33 2
ADVERTISING AGENCY AND MEDIA
Unit Structure
2.0 Objective
2.1 Introduction
2.2 Various functional departments of ad agency
2.3 Types of ad agency
2.4 Measures for gaining clients by ad agency
2.5 Reasons for loosing clients by ad agency
2.6 Evaluation c riteria for selecting an ad agency
2.7 New media options
2.8 Forms of digital media
2.9 Media objectives
2.10 Criteria for selecting suitable media
2.11 Methods of setting advertising budget
2.12 Exercise
2.13 Summary
2.14 References
2.0 OBJECTIVES After s tudying this unit, the student will be able to :
 Explain about various functional departments of ad agency
 Know various types of ad agency
 Discuss measures for gaining clients by ad agency
 Highlight reasons for loosing clients by ad agency
 Evaluate criteria for selecting an ad agency
 Elaborate new media options
 Describe forms of digital media
 Tell media objectives
 Understand criteria for selecting suitable media
 State methods of setting advertising budget

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34 Advertising and Sales Management
34 2.1 INTRODUCTION Advertising agencies started as sp ace brokers for the handling of the
advertisements placed in newspapers. Through the years, however, the
function of the agencies has changed. Their main job today is not to aid
media but to serve advertisers.
An advertising agency is a professional servic e firm hired by other
businesses, corporations, non -profits, and government agencies to plan,
produce, and manage the showing of advertisements in different mediums.
An advertising agency is a firm that specializes in the creation, design and
placement of advertisements, and in the planning and execution of
promotional campaigns for products and services of their services.
Today, ad agency is an advertising experts or specialists in planning,
creating and placing of advertisement. They plan and execute ent ire
advertising campaigns. They conduct market research also on behalf of
business enterprises. They choose the necessary description or brands,
design the package or labels on the package. They select the media of
advertisement. They prepare entertainment as well as commercial spots for
radio and TV advertisements.
Definition of Advertising Agency :
According to Association of Advertising Agency of America (AAA) “an
independent business organization, composed of creative and business
people, who develop, pr epare and place advertising in advertising media
for sellers seeking to find customers for their goods and services.”
2.2 VARIOUS FUNCTIONAL DEPARTMENTS OF AD AGENCY

A. Creative service department:
The creative department is the heart and soul of ad agency. Creativity
differentiates one agency from another. This department composed of the
visualizers, copywriters, art directors, production manager and the traffic
managers. The functions performed by the department are:
1. Copy writing:
Copywriting is the process of writing advertising promotional material.
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35 Advertising Agency and Media Copywriters are responsible for text on promotional material. It is the skill
of choosing the right words and techniques of arranging them smartly to
promote product or idea.
2. Artwork:
The art directors and artists prepare the artwork of the advertising which
includes designing illustration, graphic designing and layout. They are
responsible for the overall visual aspects of an advertising campaign.
3. Production:
After th e copy has been written and the artwork is approved by client, the
ad is turned over to the production department. This department looks
after mechanical production of print advertisement and production of TV
or radio commercial. The services of printers, typographers, script -writers
and directors are required in this process of production of ad. At times,
agencies handover this function to outside independent agency.
4. Traffic:
Here traffic means scheduling. To keep the work flowing on schedule,
there is the traffic officer. His major duty is to monitor the production of
finished ad so that it can be placed in media as per schedule.
B Accounts service department:
This department is responsible for providing services to the client. The
department comprise s of accounts executives and account supervisors. An
account executive acts as the link between the agency and the client.
He/she is responsible for the overall agency -client relationship. The
account executives perform the following work:
Preparation of A d plan:
The account executive studies product and requirements of the client and
accordingly prepares advertising plan. Later on this ad plan is sent to the
client for approval.
1. Budget preparation:
The account executive may assist media planning depa rtment in
preparation of advertising budget of the client.
2. Agency -Client Relations:
The account executive acts as a link between the agency and its clients. He
maintains good rapport and relations with the client. He/ she handle the
requirements and p roblems of the client.
3. Creative Pitch:
The account executive may assist creative people to make a presentation
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36 Advertising and Sales Management
36 B. Media service department:
The media service department is responsible for media planning, buying
time a nd space, and media research.
1. Media planning:
This section is responsible for planning and selection of the right media -
mix (TV, Radio, magazine, newspaper, digital media etc.) considering
certain factors such as ad budget, objectives of the campaign, nature of
product, nature of target audience and so on.
2. Media buying:
This section is also responsible for buying time and space in the media to
run the ad campaign. The media executives prepare media schedule,
relating to the dates and time/space of broadcasting or publishing the ads.
3. Media research:
The research section undertakes media research to find the effectiveness of
the media with reference to specific products. This section may also
undertake pre -testing and post -testing of ads.
D) Admi nistration and Finance services department:
This department is composed of office managers, accounts and finance
managers and clerical staff. It looks after the administration, accounts and
finance related matters. The department performs following functi ons:
1. Office administration:
The office manager is responsible for day -to-day office administration. He
also looks after office management and handles issues related to personnel
i.e. recruitment, training, promotions, transfers etc. The clerical staff
provides clerical services like typing, filing and record keeping.
2. Accounting:
This department looks after maintaining proper books of accounts, receipts
and payments etc. It collects bills from the clients and makes payment of
media bills.
3. Finance :
This section deals with internal budgets, cash flows, preparing investment
plans etc. It also makes analysis of profit and loss statement.
2.3 TYPES OF AD AGENCY 1. Full Service Agency:
A full agency is usually large in size and offers their clients a full range of
services such as copywriting, artwork, production of ads, media planning
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37 Advertising Agency and Media pricing, distribution, packaging, product design etc. The biggest advantage
of utilizing the servi ces of a full service agency is that they have the best
talent and they provide numerous services, all under one roof. For
companies who want a one -stop approach full service agency is the best
option.
2. Modular Agency:
It is a full service agency that s ells its services on piece meal basis. It may
provide only creative services to an advertiser. The advertiser avails other
services from elsewhere. Fees are charged for actual work undertaken.
3. Creative Boutique:
This is a form of advertising agency wh ich provides only creative services
and not full -service. For clients who seek creative talent because of
unavailability of talent in the in -house agency or because of the repetitive
forms of advertising, creative boutiques are the best place to go after.
They are known for their superiorly creative and innovative ads. Apart
from creating ads, they do not offer any other service. Therefore it
increases their focus and the quality of the output they produce. The
disadvantage of availing the services of a cr eative boutique include that
the clients have to employ other ad agencies for the rest of the functions.
Co-ordination between the two agencies can be full of hassle.
4. Global and Local Agency:
Agencies can also be classified as global and local agencie s. The global
agencies have branches or offices worldwide. Eg. WPP Group, and Ogilvy
& Mather have offices in over 100 countries across the globe. There are
also local ad agencies that cater only to local markets. Eg. Bright &
Kohinoor operate in Mumbai.
5. Mega Agency:
Mega agencies refer to the merger of the agencies worldwide. In 1986,
Saachi & Saachi, a London based agency started such merger and at
presents it is the 3rd largest agency network in the world. Due to their size
and global operations, meg a agencies are in a position to serve the clients
in a better way.
6. Media Buying Agency:
The function of media buying agency is to purchase large amounts of time
and space on media which they get at a huge discount and then the re -sell
it to the other clients on good profits. The function also includes
scheduling various slots for various companies on different media like TV
and radio stations and ensuring that proper telecasting of respective media
has taken place at a proper time or not.

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38 Advertising and Sales Management
38 7. Specia list Agency:
There are some agencies who undertaking advertising work only for
certain type of products/services. In other words, they take up only
specialized advertising jobs. Eg. Some agencies specialize producing ad of
financial services and some othe r ad agencies may be specialized in
producing social advertising or medicine related advertising and so on. In
India, there are agencies specialized in financial ads. DAVP (Directorate
of Advertising Visual Publicity) is a specialist agency which gives
publicity to Government’s policies and programmes.
8. In-House Agencies:
Such agencies are owned and supervised by advertisers.
The organizational structure and functioning of in -house agencies are
similar to full service agencies in most cases. The adverti sing director of
the company usually heads an in -house agency. In -house agencies are
organized according to the needs and requirements of the company and are
staffed accordingly. Large advertisers, such as Calvin Klien and Benetton
have in -house ad agencie s.
2.4 MEASURES FOR GAINING CLIENTS BY AD AGENCY There is an intense competition in the ad agency business. It is important
for an ad agency to gain and maintain the client. The survival and growth
of ad agency depends upon the number of clients gained an d maintained.
Following are some of measures that can be taken by ad agency to
gain the clients .
1. Referrals:
Referrals helps to gain clients from the existing clients. The agencies can
maintain good working relationship and provide better services to th eir
existing clients. Therefore existing clients may refer services of ad agency
to others.
2. Presentations:
The agency can take appointment from the target clients. The agency
representative can approach target client as per appointment and make
present ation in an effective way. This gives an idea to the target client
about services provided by ad agency, their previous work and so on. The
agency representative can also provide special offers to the target
audience. This way ad agency can make the new cl ients.
3. Publicity:
The ad agency can undertaken publicity by the way of:
 Giving interviews,
 Conducting seminars, munotes.in

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39 Advertising Agency and Media  Offering charitable donations,
 Inaugurating mega events by film actors, cricketers, politicians, or
popular personalities,
 Arranging st age show, etc.
That attracts mass media to publish the news about them and the agency
can make new clients.
4. Public Relations (PR):
PR is concerned with maintaining rapport with different groups such as
employees, customers, suppliers, investors, govern ment and so on. Ad
agency can develop rapport, goodwill, understanding and acceptance
through a two way communication. This can attract advertisers towards ad
agency.
5. Create brand image :
The ad agency can create its brand image by providing excellent services
to their existing clients. Brand image creates brand loyalty of existing
clients towards ad agency and they recommend services of ad agency to
other advertisers.
6. Feedback :
The ad agency can take feedback from their existing clients about their
service satisfaction. This helps an ad agency to improve upon their
services and result into client satisfaction. Therefore, it enables ad agency
to get more work from existing clients as well as existing clients
recommend services of ad agency to other a dvertisers.
7. Rapport with existing clients:
There should be good rapport between the ad agency and the existing
clients. The representative of ad agency and clients must gel with each
other effectively. The representative may even have informal get -together
to develop excellent relationship between the agency and client. The
existing client in turn spread positive word -of-mouth about ad agency to
other advertisers.
8. Research:
The ad agency can undertake client research to know their requirements.
Agen cy should also undertake market research to know the strategies of
competitors and market trends in terms of advertising. All this helps ad
agency to remain updated. Further, the research helps in innovation and
creativity. Therefore, ad agency can gain mo re clients.
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40 Advertising and Sales Management
40 2.5 REASONS FOR LOOSING CLIENTS BY AD AGENCY 1. Poor Quality of Services:
Every advertiser expects best quality services from their ad agency. If the
client becomes dissatisfied with the quality of services provided by the ad
agency, then it may leave the existing agency and look for another agency
which provides better services.
2. Personnel changes in Staff:
A client sometimes switches over to new agency when the creative team
or key employees of the existing agency moves out to another a gency.
This is because sometimes advertiser may develop good rapport with
particular employee of ad agency. They feel comfortable working with a
particular employee of an ad agency with respect to preparing an ad
campaign. Even personnel changes in top exe cutives of client may result
in shift to other agency.
3. Lack of co -ordination and communication:
Poor co -ordination and communication between the client and the agency
staff fails to develop trust and confidence in each other. Also poor co -
ordination a nd communication may affect the quality of ad campaign
prepared by an ad agency. This is because to create effective ad campaign
continuous co -ordination and communication between ad agency and
client is necessary. In absence of such co -ordination and comm unication,
the client may leave the agency.
4. Human Tendency to change:
Some clients prefer not to contract with the same agency again and again.
They change the agency just for the sake of changing and not due to some
genuine reason.
5. Non-availabilit y of required services:
If the present agency cannot render the services required by the client, the
client shifts to the agency that provides those services. Eg. An advertiser
requires copywriting services from their existing ad agency. But existing
ad agency does not provide that service. In that case the client may leave
existing ad agency and search other agency that provides copywriting
services.
6. Dissatisfaction with the creative staff:
Creativity is the essence of ad. One of the important factor s in contracting
with a particular ad agency is creative services offered by it. However, if
the client is not satisfied with the creative efforts taken by the agency, he
may terminate the contract.
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41 Advertising Agency and Media 7. Conflict on payment:
If the client feels that
 The agency is charging higher fees,
 The agency is charging higher service charges,
 The agency does not passing cash discount received from media,
 The agency recommending media just for the sake of higher
commission etc.,
All this may result in client leavi ng the existing agency.
8. Handling a competitor’s account:
The agency may start handling a competitor’s account. This may force the
client to shift to some other agency.
9. Unsuccessful ad campaigns:
If the ad campaign launched fails to bring in the d esired results, the client
may contract with another agency for the next ad campaign.
10. Change in location of agency:
Sometimes the agency may shift its location far from the place of business
of its client. In that case the client may find it difficul t to visit (whenever
required) to the ad agency office to discuss about ad campaign. Therefore,
the client may leave existing ad agency and search another nearby ad
agency.
11. New agency has highly creative personnel:
The client may find that new agency personnel are more creative as
compared to the existing ad agency. This is possible when services of new
ad agency are recommended by someone to the client.
12. Non-accreditation of agency:
Accreditation gives assurance about the quality of services and
professionalism of ad agency. Some clients prefer agencies which are
accredited. They may not like to contract with non -accredited ad agency.
2.6 EVALUATION CRITERIA FOR SELECTING AN AD AGENCY 1) Creativity:
Creativity is the essence of ad. Hence one of the most important factors
considered while selecting an ad agency is the quality of creative services
offered by the agency. Creativity depends on the quality of creative
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42 Advertising and Sales Management
42 2) Services Offe red:
There are different agencies providing different services. Some agencies
provide all the services know as full service ad agency. But there are some
agencies which provide selected services know as creative boutique. It
depends on the requirements of advertiser whether he needs a full service
agency, creative boutique or media buying service agency. As far as a
particular agency provides required services to an advertiser, the advertiser
would select that particular agency.
3) Specialization:
Some a gencies are specialized in producing advertisements of particular
line of products. Eg. Some agencies are specialized in financial ad.
Advertisers dealing in financial products may prefer such agencies.
4) Remuneration / Cost of service:
The cost of the s ervices rendered is very important factor to be taken into
account while selecting an agency. The fees charged are not uniform i.e. it
differs from agency to agency. The rates of agency must suit the pocket of
client. The advertiser should select agency wh ose rates are within the ad -
budget.
5) Reputation of the Agency:
The past record and reputation of the agency in the field of advertising
must be considered. The advertiser should enquire about the image,
integrity, ethical standards, relation of agency with its clients, successful
campaigns with other clients etc. Advertisers prefer ad agencies that have
good past record and reputation.
6) Location:
A major factor to be considered while selecting ad agency is location or
office of agency. A considerabl e amount of communication is required
between ad agency representative and client at different level of planning,
creation and execution of ad campaign. So a local agency or an agency
having a branch office located close to the advertiser’s office should b e
preferred which is easily accessible.
7) Competitor’s Agency:
The advertiser must not approach an agency that handles competitor’s ad
campaigns. This is because such an agency will not prepare ads which will
help the advertiser to win over competition. There are also chances of
disclosing confidential information of the client to the competitors.
8) Media Connections:
An agency which has better contacts with media owners must be selected.
Such an agency is in a position to book the desired time and spa ce in the
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43 Advertising Agency and Media passed on to the advertiser. Eg. Particular agency may have good
connection with the all major newspapers. In that case advertiser who
wants to advertiser in newspaper can get benefit of advertising at desired
time and space in the newspaper.
9) Accreditation of the agency:
Some ad agencies are accredited by the INS, Doordarshan and AIR. It
gives professional status to the agencies. Such agencies follow the code of
ethics laid down by the media owners. This suggests that such agencies
must be approached.
10) Size of the Agency:
There exist both large size and small size agencies. Both have their own
advantages and disadvantages. A large size agency may provide a wider
range of services and facilities as well as they have better media
connections. Small size agencies may provide personalized attention to the
client
2.7 NEW MEDIA OPTIONS The term ‘media’ means channels of communication. Advertising media
refers to the variou s media channels through which advertising of products
and services is done to reach customers. Traditional media has been used
in the advertising world for years. These include newspaper, magazines,
radio, television, outdoor, cinema advertising, direct m ail and so on.
Traditional media are most common form utilized by advertisers since
decades. Over the course of last few years, more businesses are making
use of new age media to reach target audience. The different new media
options are as follows:
1) Digital media:
Digital media delivers promotional content through various online and
digital channels. It includes mediums such as social media, email, search
engines, mobile apps, affiliate programs and websites to show
advertisements and messages to audien ces.
2) Social media:
Social media focuses on creating, sharing and exchanging information,
idea and content in online network and communities. It is highly
interactive and very powerful media to reach target audience. The
prominently used social media fo r advertising includes Whatsapp,
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44

3) Aerial media:
It is a form of advertising in which some form of aircraft is enlisted to
create or display advertising message. It uses blimps (airship that maintai n
its form by pressure from contained gas) and inflatable low flying airship
to advertise logo over a large crowd of people. It also uses banners in
which long strip of cloth bearing a logo or slogan is attached to an
aircraft. Another form of aerial adver tising is skywriting in which an
aircraft uses smoke trails to write a message in the sky. This form of aerial
advertising can be subject to weather conditions and is most effective on
cool, humid, windless, clear days.

4) Vlogs:
Vlog is a personal web site or social media account where a person
regularly posts short videos. Vlog is a recent development in the field of
advertising. It includes the promotional videos that play before, during,
and after streaming content. Eg. Many YouTube vlogers who have
millions of subscribers undertake promotion of different types of products
/ services through their videos

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45 Advertising Agency and Media 5) Digital signage:
Digital signage is an advertising format that is based on the delivery of
digital content through devices such as screens, projectors, touch panels
etc. Generally, these devices are located at the point of sale or in public
places. It allows a company to create, manage, distribute, and publish its
own content, combining the advantages of digital advert ising and more
conventional external advertising.

6) In-game and In -app advertising:
With millions of users playing video games every minute of the day,
gaming has undoubtedly become one of the biggest forms of entertainment
on the planet. In-game advertising, or IGA, refers to advertising in
computer and video games. IGA sees advertisements being integrated
within computer games and mobile games. This is generally seen in the
form of pop -up messages, cut -scenes, on -screen adve rts, billboards, and
background displays. Virtual spaces are sold for advertising purposes to
advertisers, much in the same way space is sold in the real world.
In the same way we use many applications (apps) in our mobile phones.
While operating these app s we come across many advertisements.

7) Other new media options:
It includes advertising in the form of:
 In-flight advertising
 In lift advertising
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46 Advertising and Sales Management
46  Keychain, diary, books, utility bills, calendar advertising
 FM radio advertis ing

2.8 FORMS OF DIGITAL MEDIA 1) Search Engine Advertising:
Search Engine Advertising is a part of search engine marketing and thus
an integral part of online marketing. Search engine advertising is a range
of paid -for ads th at are mostly displayed on the results pages of search
engines like Google.

2) Ad banner:
This is the most basic type of internet advertising. A banner contains a
short text or graphics to promote a product or service. It appears on third
party websites . It provides a hyperlink or the advertiser’s website. Banner
ad allows the users to open the advertiser’s website as and when they click
them. It provides information and at the same time persuades the buyer to
buy the product.
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47 Advertising Agency and Media

3) Websites:
A website is a set of interconnected web pages which usually includes a
home page. It is prepared and maintained as a collection of information.
Through website, the user can find information about the company’s
products, history of the co mpany, additional services offered etc.

4) Sponsorships:
Here, an advertiser sponsors an entire website or a section of a site. The
sponsorship is exclusively for a specific period of time. Normally, the
advertiser uses this kind of advertising for bra nding or for introducing a
new product.
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48 Advertising and Sales Management
48
5) Interstitial:
Interstitial ads appear between web pages that the user requests. These
involve animated advertisement that pops up on the computer screen while
downloading a website b y the user. Another emerging format is a full -
page ad that interrupts content of visitor, forcing exposure to the
advertisement before visitors can continue on their content path.

6) Pop-Up windows:
Pop-up windows are new win dows that pop up in front of the website
content. The user has to click on these ads to make them disappear. While
consumers may find them frustrating, they are much more effective at
producing brand impressions.
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49 Advertising Agency and Media

7) Email advertising:
Ads are sent thr ough email are known as email ads. These are similar to
direct mail advertising. The advertiser can send them regular updates on
specials, discounts, new products etc. Email has the ability to reach global
audience at low cost. However, there is too much o f spam through email
due to which the email may not be read.

8) Video ads:
Video ads are very popular on the internet. The advertiser can create a
video for the product and post it on various internet channels such as
YouTube, Facebook, Twitter, YuMe, Vimeo etc.
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50 Advertising and Sales Management
50 9) Social network ads:
It is one of the fastest growing forms of online advertising. It refers to
commercial promotion conducted through social media websites such as
LinkedIn, Facebook, Twitter, Instagram, Whatsapp etc. Many companies
promo te their products by posting frequent updates and providing special
offers through their social media profiles. Such ads can be aimed at a very
highly targeted audience at low cost.

10) Mobile ads:
Mobile ad is a method of ad vertising via wireless phones or other mobile
devices such as tablet computers. Advertising can take the form of display
ads, SMS, MMS ads, mobile search ads, ads appear in downloaded apps or
in-mobile games.

11) Affiliate mark eting:
Affiliate marketing involves referring a product or service by sharing it on
a blog, social media platforms, or website. The affiliate earns a
commission each time someone makes a purchase through the unique link
or code associated with their recom mendation.
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51 Advertising Agency and Media

2.9 MEDIA OBJECTIVES The media objective is a clear statement of a goal that tells what the media
plan should accomplish in a very specific and measurable terms. The
media planner has to decide on the media objectiv es. Media objectives are
often stated in terms of reach, frequency, gross rating point and continuity.
1) Reach:
It refers to the number of persons / households exposed to a particular
media vehicle at least once during specific period of time. This can be
explained with the help of an example : A sample group of 10 TV homes
that may be watching ‘program X’ over a period of 4 weeks reveal the
following: Weeks Homes Total Exposures A B C D E F G H I J 1 X X X X 4 2 X X X X 4 3 X X X X 4 4 X X X 3 Total Exposures 2 4 0 1 2 2 0 1 0 3 15
It can be seen that 7 homes watched program X at least once during the
period of 4 weeks. Thus it, can be concluded that that reach of this
program was 7 of 10 = 70%.

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52 Advertising and Sales Management
52 2) Frequency:
It refers to the number of times within a specified period that the target
audience is exposed to the message.
The average frequency = Total Exposure / Reach
In the example discussed above, Average Frequency = 15 / 7 = 2.14
3) Gross Rating Point (GRP):
The conc ept of ‘reach’ and ‘frequency’ are put together so as to describe
the total weight of a media effort. In quantitative terms,
Gross Rating Point = Reach X Average Frequency
In our example, GRPs = 70 X 2.14 = 149.8 = 150
Advertisers and marketers use GRP t o measure the impact of given
advertisements. Basically, the more rating points programs earn, the
more television viewers have the potential to view the advertisements or
promotional spots. This makes securing advertising time on popular
network televisio n shows. Television networks recognize the desirability
of advertising on these programs and charge advertising rates in
accordance with programming popularity.
4) Continuity:
It deals with how the advertising is scheduled over the planning period. In
other words, it refers to the pattern of placement of advertisements in the
media schedule:
 Continuous: Strategy of running ad campaign evenly over a period of
time.
 Flighting: Strategy of running periodic heavy advertising followed by
no advertising and agai n heavy advertising
 Pulsing: Strategy of running periodic heavy advertising followed by
limited in advertising and again heavy advertising
2.10 CRITERIA FOR SELECTING SUITABLE MEDIA 1) Nature of Product:
The nature / type of the product affect the choice of media. Eg. Consumer
goods require demonstration then TV could be better choice. Industrial
products (tools, equipments, machines) can be effectively advertised in
business journals.
2) Advertising Budget:
It is one of the most important factors to be t aken into account while
making the choice of media. In case of limited amount of funds, the munotes.in

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53 Advertising Agency and Media advertiser may use only 1 -2 media of advertising. On the other hand when
large amount of funds are available, the advertiser not only makes a
variety of media but a lso expensive ones.
3) Competitor’s Strategy:
An advertiser’s media decisions are influenced by the competitor’s
strategy. Since the advertiser tries to reach the same audience as his
competitors, he may use the same media mix used by his competitors.
4) Target Audience:
The advertiser has to consider the type of consumers to whom the message
has to be directed. The media selected must reach desired group of people.
Eg. Cosmetics can be effectively advertised through women magazines. In
order to target housewives TV is the best suitable media. If the advertiser
wants to reach working people then outdoor media such as transit
advertising, hoardings, posters, banners etc. will be an appropriate choice.
5) Advertising Objectives:
The advertising objectiv es affect the choice of the media. Eg. If the
objective is to create awareness about the brand at national level, then the
advertiser is likely to go for media having national reach such as Times of
India newspaper, National TV channels (Zee, Star, Colors etc.). If the
objective is to create brand image, then the advertiser may select TV or
internet media.
6) Availability of media space and time:
Media space and time have to be booked in advance especially in case of
popular media slots. This is due to tre mendous increase in the competition
and demand. When an advertisement has to be placed immediately then
the advertiser has little choice to use the available space and time. Eg. An
advertiser wants to publish his/her ad in Times of India newspaper on
Wedne sday on front page, the time and space has to be booked atleast a
month or two in advance.
7) Media restrictions:
At times, certain restrictions are placed either by the Government or by the
media itself. Eg. In India the Government does not permit advert isements
of cigarettes and alcoholic drinks on Doordarshan. In such a case the
advertiser has to select alternative media for advertising his products.
8) Language:
In India, this is an important consideration. Depending upon the particular
linguistic gro up to be reached, a particular language newspaper or
television and radio programme must be used. Eg. If the product has to be
advertised in Maharashtra, use of Marathi newspapers can be made.
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54 Advertising and Sales Management
54 9) Prestige of the media:
Prestige of the advertising medium may be transferred to the advertised
product. Eg. When an advertisement appears in The Times of India, the
image of the newspaper may be transferred to the advertised produ ct. This
enhances the status of the advertiser and adds to his goodwill.
10) Media Flexibility:
Media Flexibility refers to the ability of the media to adapt to changing
needs of the advertisers. Newspaper advertising enjoys flexibility as the
advertisem ents can be changed or withdrawn by giving a short notice to
the publisher. On the other hands, Doordarshan offers little flexibility as it
involves a lengthy procedure of getting the story board for the TV
commercial approved.
2.11 METHODS OF SETTING ADVE RTISING BUDGET

A. Fixed Guidelines Method:
Here, some arithmetic formula is used to determine the ad budget. The
fixed guideline methods are explained as under:
1) Percentage of Sales Method:
This is the simplest and the most wi dely used method of setting ad budget.
Here, the advertiser takes a certain percentage of sales (last year sale or
next year projected sale) and allocates the amount for advertising. Eg.
Projected sales of a company is Rs.50,00,000/ -. The advertiser decide s to
spend of 10% on advertising. Hence, the amount to be set aside for
advertising would be 50,00,000 X 10/100 = Rs. 5,00,000/ -
2) Unit of Sales Method:
Here, the advertiser takes the number of units sold as the base for
finalizing ad budget. The adverti ser decides a specific amount to be
allocated for advertising for each unit sold. Eg. If the number of units sold
is 1000 units and the advertiser decides to allocate Rs.50 per unit sold,
then ad budget would be Rs.50,000/ -

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55 Advertising Agency and Media 3) Competitor’s Parity Method:
Here, the advertiser decides to spend the amount on advertising equivalent
to the amount spent by the competitors. Eg. If the competitor spends Rs.
10 lakhs, then the advertiser would also spend Rs. 10 lakhs. This is an
easy method of preparing ad budget. But this may not be an appropriate
method due to:
 Difference in the objectives of competitors
 Different media selected by competitors
 If more than one competitor exists, then whose budget should be
taken as the base.
 There is no guarantee that the compet itor might have set his budget
properly.
4) Market Share:
Here, the advertiser decides his budget on the basis of his share in the
market. Eg. If a ‘brand A’ has 10% market share, its advertiser would
spend 10% of the amount spent in that product category . If ‘brand B’ has
15% share, the advertiser would spend 15% and so on.
B. Task Method:
This method is also known as ‘Objective Method’ as it provides a more
logical basis for deciding ad budget. The steps involved in this method
are:
1) Determining the adve rtising objectives: The objectives may be to
create brand awareness, face competition, create goodwill and so on.
Eg. The objective may be to create awareness at national level then
the ad budget would be higher as compare to creating awareness at
local le vel.
2) Calculating the amount required to achieve the objectives: The
next step is to draft suitable advertising plan in order to achieve the
objective decided. Further, the amount required for the execution of
the plan has to be determined.
3) Determining whe ther the amount is affordable: The third step is to
find out whether the company has the capacity to provide the amount
required for the execution of the proposed ad plan. If not, a new ad
plan has to be prepared.
4) Finalizing the budget: The ad budget is t hen finalized taking into
account several factors such as type of the product, target audience,
media mix and so on.
5) Executing the plan: The budget/plan is implemented in order to
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56 Advertising and Sales Management
56 6) Follow -up: The advertiser must find o ut whether the objectives are
achieved. If not, corrective, actions can be taken.
C. Subjective Method:
Under this method, no arithmetic formula or fixed rule is followed. Such
methods include:
1) All you can Afford Method:
Here, the advertiser allocate s that much amount which he can afford. In
other words, ad budget is decided on the basis of whatever money is left
over after all other fixed and variable expenses have been allocated. This
method is an illogical method but conservative management use it as it is
safe and it ensures that there is no over spending.
2) Arbitrary Method:
This is not rational method of preparing ad budget. This budget is fixed
without any specific advertising plan. In other words, the budget decision
is arbitrary in nature.
2.12 SUMMARY An advertising agency is a firm that specializes in the creation, design and
placement of advertisements, and in the planning and execution of
promotional campaigns for products and services of their services.
The term ‘media’ means channels of communication. Advertising media
refers to the various media channels through which advertising of products
and services to reach customers is done.
2.13 EXERCISE Fill in the blanks :
1) ___________is a firm that specializes in the creation, design and
placement of advertisements, and in the planning and execution of
promotional campaigns .
(ad agency , recruitment, retirement)
2) ________ is a form of advertising agency which provides only
creative services and not full -service.
(Local agency, Creative Boutiq ue, Mega Agency)
3) ___________ is one of the measures fo r gaining clients by ad agency.
(Poor services, Higher fees, Referrals )
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57 Advertising Agency and Media 4) _________ is one of the ad media through which advertising of
products and services is done to reach customers.
(Television , Rea ch, Frequency)
5) _______ is a set of interconnected web pages which usually includes
a home page through which the user can find information about the
company’s products, history of the company, additional services
offered etc.
(Posters, Hoarding, Website )
True or false :
1) A major function of ad agency is to provide finance to marketers.
FALSE
2) Full service ad agency provides service on piece meal basis. FALSE
3) Non-availability of required services is one of the reasons for loosing
clients by ad agency. TRUE
4) Digital signage is one of the media of advertising. TRUE
5) Frequency refers to the number of times within a specified period
that the target audience is exposed to the ad message. TRUE
Match the pairs : Group - A Group – B 1) Interstitial a) Merger of agencies 2) Account service department b) Media objective 3) Mega Agency c) Digital media 4) Reach d) Method of setting ad budget 5) Competitor’s Parity Method e) Agency-Client Relations
(1-c, 2 -e, 3 -a, 4 -b, 5 -d)
Answer in brief :
1) Write a note on various functional departmen ts of ad agency.
2) Explain the different types of ad agencies.
3) What are the measures for gaining clients by ad agency?
4) Describe the reasons for loosing clients by ad agency.
5) Discuss the evaluation criteria for selecting an ad agency.
6) Write a note on New med ia options
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58 Advertising and Sales Management
58 8) Write a note on Media objectives
9) Highlight the criteria for selecting suitable media.
10) Explain different methods of setting advertising budget
2.14 REFERENCES  https://www.yourarticlelibrary.com/advertising/advertising -
agency/99756
 https://www.investopedia.com/best -advertising -agencies -5093 717
 https://learn.g2.com/advertising -agency
 https://www.marketing91.com/8 -types -of-advertising -agencies/
 https://www.mbaknol.com/marketing -management/types -of-
advertising -agencies/
 https://smallbusiness .chron.com/determine -grp-advertising -
35671.html

*****

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59 3
CREATIVITY
Unit Structure
3.0 Objectives
3.1 Introduction
3.2 Creativity & Research
3.3 Society
3.4 Summary
3.5 Exercise
3.0 OBJECTIVES After completion of this lesson the student will be able to understand
1. Creativity &Research: Developing ad vertising copy - print,
broadcast and digital media, Pre -test and post -test methods.
2. Society: Socio -economic contribution and criticisms of advertising,
professional courses and careers in the field of advertising
3.1 INTRODUCTION Advertising creativ ity is an art form. It deals with people's perceptions,
attitudes, values, personalities, and motivations, particularly buying
motivations. It also includes approaches for visualisation, as well as
different sorts of advertising material and its components , such as the
headline and slogan. All of these features must be innovative in order to
grab customers' attention. If the proper medium is not used in the right
location at the right time to reach the right people, even the most creative
and original adver tising concepts will be wasted. As a result, choosing the
right media is critical to attaining advertising goals. However, before
going over the criteria to consider when choosing the correct advertising
medium, it's important to understand what advertisin g media means. A
means or vehicle for delivering a specific message is referred to as an
advertising media. It is a method of disseminating a marketing message or
information to potential buyers, readers, viewers, listeners, or passers -by.
3.2 CREATIVITY & RESEARCH Media research is gathering information about numerous advertising
mediums, polling consumers about their media preferences and habits, and
conducting primary and secondary research on the effectiveness of each
medium in selling certain items. In India, few advertising firms or
departments have "media research departments," and if they do, it is the
role of the department to develop media plans and strategies. Most
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60 division tha t handles media planning. The majority of agencies rely on
third -party marketing firms to perform readership or audience surveys on
their behalf. Media research examines the reach, frequency, and
effectiveness of various media and media combinations (media mix) in
reaching a specific audience. The goal of media research is to identify the
best appropriate medium or media mix for the advertiser's demands.
The role of media research can be stated as follows:
1. Reader Profile:
Media study aids in the underst anding of the reader, listener, and viewer
profiles. The data on the reader's age, income, occupation, purchasing
habits, and other demographic and socioeconomic factors make up the
reader's profile. Such a profile aids in the creation of effective ad mess ages
for the intended audience.
2. Media Selection:
Proper media research aids in the selection of the most appropriate media
mix for the advertiser based on the type of product, prospects, ad budget,
and other factors. The advertiser will choose the medi a with the greatest
number of readers, viewers, or listeners among the target population.
3. Booking of Time and Space:
Depending on the programmes viewed or articles read by the target
audience, the media planning department or the media operations
depar tment can book time and space in the media.
4. Value to Media Owners:
Media research aids media owners in improving their programmes or
editorial content in order to boost listenership, viewership, and readership.
It also aids media owners in determining how much their time and space
are worth to advertisers. For example, if data shows that the programme
has boosted viewing by 50%, advertisers will need to raise the frequency
of their advertisements.
5. Program Sponsorship:
It assists the advertiser in se lecting a specific programme for sponsorship.
The advertiser might choose to sponsor the programme that the target
audience watches or listens to the most.
6. Audience Benefit:
As media proprietors strive to improve their content, audiences benefit
from b etter editorials and programmes. Owners of media companies strive
to improve their programmes or editorials in order to attract a big number
of readers, listeners, or viewers. This would result in increased advertising
revenue for them.
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61 Creativity 7. Benefit to Medi a Planners:
Television Rating Points (TRP) reports assist media planners in
understanding the ratings of various programmes on TV channels and
radio stations. Again, the Audit Bureau of Circulation Reports assist them
in understanding the circulation tren ds of newspapers and magazines.
8. Benefit to Research Organizations:
Media research allows organisations like the Indian Marketing Research
Bureau (IMRB), the Operations Research Group (ORG), and others to
keep their initiatives on track.
3.2.1 Developing Advertising Copy :
A "Copy" is any written material that appears in advertising . It could be a
single word or a long list of words. Headlines, subheads, captions, and
other elements make up a copy. The content complements the illustration
and includes a de scription of the product's benefits, drawbacks, uses, and
services, among other things. The heart of any advertisement is the copy.
It is in charge of persuading the buyers.
A) Characteristics of Copy:
1. Brief :
Because readers are pressed for time, copy s hould be succinct. They must
be able to read the large text in a reasonable amount of time. As a result, a
text should be written in basic language with tiny, easy words. The
message should be brief and to the point.
2. Precision :
The content of a copy sho uld be self -explanatory. The message that has to
be given must be clear from the start.
3. Appropriateness :
The message should be directed at potential customers. It must be
delivered in a respectful tone. The viewers' attention should be drawn to
the prod uct, and the message should be delivered in such a way that it
elites the readers' interest in reading it.
4. Attention -grabbing :
A copy should be intriguing and thought -provoking. It must stir the
readers' interest in reading the message. The reader must determine
whether or not to read the message in its entirety.
5. Genuineness :
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62 be achieved by including one or two illus trations in the copy so that the
message has an immediate appeal.
B) Types of Copy :
1. Scientific Copy:
A scientific copy is a document that describes the features, benefits, uses,
contents, and other technical information of a technical product. It's all set
up for machines. Computers, for example. The scientific copy is aimed at
well-informed people. Customers who are aware of the product Take, for
example, a pharmaceutical may be marketed in order to attract doctors. As
a result, it clarifies the situ ation ordinary people, in general, and
professional men, in particular, are concerned about the product's technical
specifications

2. Descriptive copy :
It is non -technical copy that is provided in a way that any layperson can
understand. The copy does n ot require the assistance of a skilled specialist.
It's merely a regular announcement of new products.
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63 Creativity 3. Narrative Copy:
It is written in the form of a fictional story that describes the product's
applications, benefits, and after effects, among other things. The story is
told in a humorous manner to keep it engaging.
4. Topical Copy:
This copy establishes a link between the product and a specific event, such
as a watch firm advertising that individuals who were successful in
climbing Mount Everest had the brand's timepieces with them,
demonstrating their superior quality.

5. Personality Copy:
This copy capitalises on the insight of a well -known figure. Leading
figures such as athletes, performers in films, politicians, and others have
made statement s. Their remarks serve as credentials of outstanding
quality, which helps to boost sales.
6. Colloquial Copy:
Informal language may be utilised to express the message in colloquial
copy. The copy includes phrases that are commonly used in everyday
convers ation.
7. Reasoning Copy:
This is copy that explains why a buyer should buy a product. This content
describes in depth to the customer why a specific product must be
purchased.
8. Questioning Copy:
In this form of copy, the text poses one or more questio ns to readers
without expecting them to respond. Do you desire a quiet vacation in the
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64 9. Prestige Copy:
The customer's position and prestige are highlighted in this type of copy. It
creates a favourable environment for product sales by shifting the
customer's position. Normally, such reproductions are used to promote
high-end commodities.
C) Elements of Copy :
A copy normally includes the following elements or parts :
1. Main Headl ine:
A headline is the first or top line of an advertising, which is usually bold
and in a bigger font size. The headline's primary goal is to grab the
reader's attention right away.
2. Sub -Headlines:
Some advertisements have many headlines. The primary title is usually the
first, followed by sub -headlines. There may be overlines - which appear
before the main headline - and underlines - which appear after the main
headline. Subheadlines are used to supplement or complement the main
headline's meaning.
3. Body Copy:
This is the content that appears in the advertising message. The copy
material contains favourable information about the product and its
advantages. The audience can be converted into prospects and prospects
into customers through great copywr iting.
4. Captions:
Captions are included in the copy text. Captions are short sentences that
appear to emanate from the mouths of the persons in the advertisements.
Captions are used in comic strip -style copy. For example, you've probably
seen captions l ike these in Tortoise Mosquito Coil's print ads.
5. Slogans:
Slogans are used in almost all advertisements. It's a short, memorable
phrase that summarises the advertising message. The motto should ideally
be short, between 3 and 6 words. Many times, the s logan is all that is
needed. "The best tobacco money can buy," for example. Rothmans.
6. Logo:
A logo, often known as a signature cut, is a unique design created by an
advertiser or its products to aid in identification. There is no set rule for
where a l ogo should go. The logo, on the other hand, is usually positioned
in the bottom right corner.
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65 Creativity

3.2.2 Introduction of Advertising Media :
If the proper medium is not used in the right location at the right time to
reach the right people, even the most crea tive and original advertising
concepts will be wasted. As a result, choosing the right media is critical to
attaining advertising goals. However, before going over the criteria to
consider when choosing the correct advertising medium, it's important to
understand what advertising media means. A means or vehicle for
delivering a specific message is referred to as an advertising media. It is a
method of disseminating a marketing message or information to potential
buyers, readers, viewers, listeners, or passe rs-by. For example, a producer
might use advertising media to stay in touch with past customers.
A) Print Copy :
Today's most popular and effective form of publicity is press advertising.
It has now become a part of people's culture and political lives. Th e press,
commonly known as print, is an advertising medium that includes any
vehicles owned by others that can carry an advertising message in print for
target customers to read. Companies in India use this media extensively,
accounting for roughly 70% of their overall advertising expenditure.
Types or Forms:
The following are the two main types of press advertising:
1. Newspapers:
Newspapers are primarily purchased for their news content. Newspapers
are published on a daily or weekly basis and can be nat ional or local.
These are an effective means of disseminating information about new
products, present products, and special offers. They can be used to reach
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66 newspapers published in India, bo th in English and in regional languages.
Many English and Hindi newspapers have national circulation. As a result,
a message published in the newspaper may leave a stronger effect on the
public's minds, and it may be more explicit, clear, sophisticated, an d
lengthy. In India, there are currently 1173 daily newspapers and 5280
weekly newspapers published, with Hindi language newspapers
accounting for the most, followed by Urdu, Marathi, and Gujarati. When it
comes to circulation Uttar Pradesh has the most ne wspapers published
among the states, followed by Maharashtra and Karnataka. The Times of
India, Hindustan, Indian Express, Statesman, and Economic Times are
among the important national English language newspapers, while
Hindustan Times, Navbharat Times, N ational Dunia, and Rajasthan
Patrika are among the national Hindi language daily. However, among the
many language groups, corporations in India, both public and private, rely
heavily on English dailies for advertising. Small businesses choose to
advertise in their local newspapers. Advertisers are charged based on
column centimetre space used by the newspaper. They also charge a
premium for exceptional positions and offer discounts for contract space
bookings.
Newspaper Advertising Media's Benefits or Meri ts:
The benefits or merits of newspaper advertising media can be summarised
as follows:
1. They have a wide range of coverage since they reach every nook and
cranny in a short amount of time.
2. They provide a great deal of flexibility. The design, size , and appeal
of the advertisement may be regularly adjusted to fit the advertiser's
needs, depending on the advertiser's convenience and necessity.
3. A high frequency allows for quick advertisement preparation and
publication.
4. It is the most cost -effective advertising medium in terms of cost per
reader.
5. The daily newspaper has significant repetition value since it allows
advertisers to repeat their message in a short period of time (one day).
6. Newspaper advertisements elicit a rapid response fr om the general
public.
7. The impact of advertising copy could be easily tested by putting local
adverts (in local newspapers).
8. Their visual charms can be simply established by placing regular
adverts in newspapers.
9. Advertisers and their products have access to the reputation of the
publications. Only reputable and trustworthy businesses are given
space in leading newspapers.
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67 Creativity Newspaper Advertising Media's Drawbacks, Merits, and Limi tations:
The following are some of the drawbacks, flaws, or limitations of Nothing
is as alive as today's newspaper" and "Nothing is as dead as yesterday's
newspaper," it newspaper advertising:
1. A newspaper's existence is incredibly brief, lasting only one day. " is
stated.
2. There is circulation waste. The advertisement is distributed even in
areas where there is no market or where a new market is unlikely to
emerge in the near future.
3. If the quantity of clients is minimal, newspaper advertising may be
useless and pricey.
4. Because newspapers are typically printed on low -cost newsprint,
visual effects may not be possible in practise.
5. There is a lack of consistency in the requirements for advertising.
Lack of consistency in publisher requirem ents in terms of pricing,
size, and type of copy, among other things.
6. Newspaper advertising is less popular in developing countries, where
the majority of the population is illiterate, uneducated, and destitute.
2. Magazines and Journals:
Magazines an d journals are another type of press advertising media. They
provide selective circulation across the country at a cost that is within
tolerable budgetary constraints. These are released on a regular basis, such
as weekly, fortnightly, monthly, quarterly, or annually. When the reader is
mentally prepared to absorb advertisements, magazines and journals are
read at leisure and with attention. It has an extended period of
effectiveness. Magazines can be divided into five categories from the
advertiser's persp ective: I Special Interest Magazines; (ii) Trade
Magazines; (iii) Technical Magazines; (iv) Professional Magazines; and
(v) Regional Magazines.
Benefits or merits of magazines and journals include:
The following are some of the benefits of using magazines and journals as
a form of advertising:
1. The life of a magazine is far longer than the life of a newspaper.
These are maintained on hand for weeks or months at a time.
2. Advertisements are reproduced better than in newspapers.
3. Magazines are highly selective in nature, therefore there is no waste
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68 4. Magazine advertisements establish prestige, credibility, and a high -
quality image.
5. In the case of magazine advertising, the number of readers per copy is
relatively high. There are m any different types of readers.
6. Magazines are excellent vehicles for introducing new concepts.
7. Magazine readers are often leisurely home readers who read for
pleasure and relaxation, and who read "with their guards down."
8. Magazine advertising i s more appealing than newspaper advertising in
terms of printing, paper, and colour combination.
9. Magazines are a convenient and effective way to contact specialised
groups.
10. The expense of advertising in publications is quite modest.
Magazine and Jo urnal Advertising's Disadvantages, Demerits, and
Limitations:
When compared to newspaper advertising, magazine and journal
advertising has the following disadvantages, demerits, and limitations:
1. One of the most significant disadvantages of magazine ad vertising is
its lack of flexibility.
2. Magazine copy preparation fees are typically substantial, and in some
cases exceed the cost of space in trade magazines.
3. In comparison to newspaper advertising, the circulation is limited.
4. It takes longer t o print and distribute than newspaper advertisements.
5. Because the size of publications varies greatly, the advertiser must
tailor the advertisement language to the size of the magazine or
journal.
6. A change in appeal cannot be effective in a short p eriod of time.
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69 Creativity 3.2.3 Broadcast Copy :
There are 2 types of Broadcast Copy – Radio and Television
Radio is become one of our most important advertising mediums. It
reaches a significant number of people in both urban and rural locations.
In our country, pr actically every family now owns a radio. In India, radio
advertising began in 1967 with the launch of a commercial service on
"Vividh Bharati." All -India Radio stations in Delhi, Bombay, Madras,
Calcutta, Poona, Nagpur, and Bangalore, among others, now tra nsmit
commercially. Ceylon Radio Commercial Broadcasting has a large
following across the country. Commercial broadcasting is a significant
source of revenue for the company. As the demand for radio advertising
exceeds the time available, it has become imm ensely popular among both
trade and industry. Radio advertising can be described as "large -scale
word -of-mouth advertising."
A. Radio Advertising's Benefits or Merits :
In India, radio advertising is quite popular because of the following
benefits:
1. It has a large area of coverage. This media reaches out to even
illiterate individuals. It has the ability to send messages to even the
most remote locations.
2. It's adaptable, as it can be used on a national or local level depending
on the situation.
3. It delivers the advertiser's message to prospects when they are in the
right frame of mind.
4. It attracts people's attention quickly.
5. Radio advertising is now a significant source of revenue.
6. It touts the benefit of remembering value. In this regar d, psychologists
claim that everything learned through the ears is difficult to forget.
7. Radio advertising provides a variety of programmes, including
entertainment, which helps to build goodwill. People purchase the
radio -advertised product because the y love the free broadcast.
8. Radio advertising has a human touch that no other medium can match.
B. Radio Advertising's Drawbacks, Merits, and Limitations :
The following are some of the drawbacks, flaws, or limitations of radio
advertising:
1. The messa ge conveyed by radio commercials is transient.
2. It is expensive and out of reach for small and medium -sized
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70 3. It only appeals to the sense of hearing and hence does not depict a
visual representation of the product's container.
4. It is i ncompatible with a wide range of products, including industrial
equipment that aren't required by the usual radio listener. It's just good
for typical household items.
5. Because radio commercials are so brief, information cannot be
elaborated.
6. Becaus e there are so many advertising in such a short period of time,
the listener is likely to forget the product's name.
7. In the case of radio advertising, no demonstration is possible.
8. It is a targeted advertising medium.
C. Television Advertising :
Television Commercials: It is considered that today's television
commercials are the most effective selling medium ever devised. It has a
potential advertising impact that no other medium can match. It is a
method of delivering genuine demonstrations into the homes of prospects,
making it a more effective medium than radio. As a result, television
advertising is gradually taking the place of radio advertising. On January
1, 1976, commercial television advertising was launched in India,
following the model of A ll India Radio. As a result, television is a
relatively new advertising medium in India. In India, it is also referred as
as "Doordarshan." Television makes extensive use of sight, sound, and
motion to maximise audience effect. Color can now be used to enh ance
the effect on colour televisions. In India, television coverage is expanding
at a rapid rate. This medium is especially beneficial for advertisers who
need to demonstrate their items. In India, sponsored programmes have also
begun to air on television .
D. Television Advertising's Benefits or Merits :
The following are some of the benefits of television advertising:
1. Television advertising has the advantage of combining the benefits of
both radio and cinema. As a result, it is a very strong audio -visual
medium.
2. It enhances the message's appeal and impact.
3. It is especially beneficial to advertisements whose products or
services necessitate demonstration.
4. It is a significant source of revenue for Doordarshan.
5. It is selective in terms of geography. Advertisements can be placed on
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71 Creativity 6. It has a large area of coverage. Currently, more than 80% of India's
population has access to television services.
E. Television Advertising's Dra wbacks, Merits, and Limitations :
The following drawbacks or restrictions apply to television advertising:
1. It is an extremely expensive advertising medium that would almost
probably exclude small businesses.
2. Television messages are transient.
3. The reach of the telecasting to the public is extremely limited.
4. In India, the average Indian cannot afford television since it is so
expensive.
5. Because of the high cost of advertising on television, television
commercials are generally brief.
6. Television advertising is a purposeful medium that necessitates long -
term preparation, authority permission, and a lack of flexibility.

3.2.4 Digital Media Copy :
The Internet has been around for more than 30 years. It all started in the
early 1960s in the United States, when the US Department of Defense saw
it as a way to connect researchers and military bases around the country
with supercomputers. Until the 1990s, the Internet was a relatively
unknown network of linked computers used mostly by academics, military
researchers, and scientists around the world to send and receive electronic
mail, move files, and find or retrieve information from databases. The
Internet, which is currently the fastest expanding medium in history,
provides amazing potential fo r a wide spectrum of people in business and
advertising. There is a whole new world of prospective customers for
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72 A. Types of Internet Advertising :
There are many different types of ads that can be found on the internet.
Websites, banners, but tons, sponsorships, interstitials, Meta
advertisements, classified ads, and email ads are the most common types
of online advertising.
1. Websites:
Some businesses consider their entire website to be an advertisement. A
website, on the other hand, is more than just an advertisement; it's a place
where customers, prospects, shareholders, investors, and others can learn
more about the firm, its goods, and services. Some businesses utilise their
websites to sell their products and services in the same way tha t they
would an extended brochure. Others use their website as an online
catalogue store, completing transactions directly over the Internet. Other
websites act as sources of information and pleasure.
2. Ad banners:
The most basic kind of web advertising is the ad banner. A banner is a
small advertisement that spans the top or bottom of a Web page.
Currently, larger banner ads that can dominate the screen or even give
television commercials are available. Users are directed to the advertiser's
site or a b uffer page when they click their mouse pointer on the banner.
3. Buttons :
Buttons are similar to banners in appearance. They are a smaller form of
the banner that resembles an icon and normally link to an advertiser's
home page. They are less expensive th an banners because they take up
less space.
4. Sponsorships:
Web page sponsorships are becoming increasingly popular as a kind of
Internet advertising. For a limited period of time, usually measured in
months, corporations sponsor entire portions of a pub lisher's Web page or
single events. Companies receive substantial prominence on the site in
exchange for their sponsorship support. Integrating the sponsor's brand
with the publisher's content might sometimes result in an added -value
bundle. A corporate fi rm, for example, could sponsor a Web page on the
Olympics or other events.
5. Interstitials :
Interstitials are a type of dynamic Internet advertising. It's a catch -all
phrase for a variety of animated advertisements that appear on the screen
as the comput er downloads a webpage that the user has requested. Pop -up
windows, splash screens, superstitials, and other sorts of interstitials are
now available.
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73 Creativity 6. Meta Ads:
A met ad is an advertisement displayed on the results page of a search,
specific to the sea rched item, and is used in search engines (such as
Yahoo, Google, and others). Keyword advertising is another name for
meta adverts. An advertiser can use this strategy to target a specific
audience. Advertisers can pay search engines to show their adverti sing
only when users search for relevant terms. For example, if a user searches
for "handicrafts and handlooms," the Meta advertisements that appear may
be for things related to handicrafts and handlooms.
7. Classified Ads:
Classified ad websites are anot her expanding market for Internet
advertising. Because they are supported by ad banners from other
advertisers, some of these websites provide free classified advertising
options. They're similar to classified advertising in newspapers. You can
look for ho uses, vehicles, jobs, toys, and shoes, among other things.
8. E- Mail advertising:
Advertisers can send e -mail advertising to customers who have
specifically requested it. It is the most effective method of online
advertising because it is identical to di rect mail advertising. However,
there is an excessive amount of space in the e -mail. Unsolicited bulk e -
mail advertising for a product or service sent to e -mail addresses by an
unknown party is referred to as Span.
B. Internet Advertising's Benefits:
1. In teractive Medium:
This type of medium allows customers to interact directly with advertisers,
developing long -term partnerships.
2. Massive Audience:
With a global audience of roughly 500 million people (some estimates put
it at 1 billion), the internet is the only truly global medium, giving
information and commercial opportunities that are instantly accessible
throughout the world.
3. Immediate Response:
Products and information are available on demand by the consumer,
providing the advertiser with imm ediate feedback.
4. Selective Targeting:
Advertisers, particularly through Meta advertisements, can reach the
proper target demographic.
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74 5. Proximity to Purchase:
This may be the most important benefit of Internet marketing. Purchasers
can be targeted wh erever they are, at the exact moment they are
contemplating making a purchase.
6. Affluent Market :
The majority of Internet users are from the middle -upper -upper -middle -
upper -middle -upper -middle -upper -middle -upper -middle -upper -m As a
result, the Internet m edium allows for access to the society's affluent
market.
7. Offers Detailed Information:
The Internet offers detailed information about a firm and/or its products.
Commercial websites provide Internet users seeking information with
specific information a bout items or services.
8. Reaching Business -to-Business Users:
The Internet media may reach B2B users while they are still at work,
providing them with not just business -related information, but also
consumer product promotion.
C. Internet Advertising's Drawbacks:
1. Ineffectiveness of mainstream media:
Unlike radio and television, the internet is not a mass medium. As a result,
it may never be able to provide mass media efficiency. Most marketers in
poor nations, such as India, may find it too complica ted, cluttered, or time -
consuming.
2. Slow Downloads:
In many regions of the world, including India, website downloads are
extremely slow. The advertisements that appear in between upset Internet
users.
3. Spam problem:
There is an excessive amount of sp am sent via e -mail. As a result, even the
responsible advertisements are ignored by e -mail users.
4. The Problem with Online Purchases:
In India, most buyers prefer to inspect things in person before making a
purchase. As a result, they are unable to plac e orders online. Again, most
people do not trust the internet as a safe place to conduct business.

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75 Creativity 5. Unproven Medium:
There hasn't been much research done to see how effective Internet
advertising is. As a result, a large number of Indian marketplaces do not
place a high value on Internet advertising.

D. Advertising Though Cell Phone :
The promotion of ring tones, games, and other mobile phone services is
known as mobile phone advertising. Subscription -based services that
employ the Short Message Servi ce (SMS) technology are common. Idle -
screen is another means of broadcasting messages to mobile phones,
allowing mobile operators or advertisers to reach millions of people in real
time. In recent years, the promotion and sale of ring tones has exploded,
with some commercial breaks, notably on music television channels and in
motor racing, being dominated by such advertisements.
While mobile phone advertising is still relatively new, innovators have
devised ways to use a phone to offer advertising to other s standing near a
mobile phone user while the user is speaking in a non -hands free mode.
The usage of viral marketing is a novel way to mobile content advertising.
Users can send recommendations for mobile material they like to their
contact lists using sp ecifically created programmes.
Mobile phone content advertising is a widespread occurrence, and almost
all mobile phone users are well aware of it.
This function is used to market a variety of products, ring tones, games,
quizzes, mobile accessories, and a variety of other items that are either
directly or indirectly related to mobile phone features. These methods of
advertising are, in general, totally reliant on user subscription. This is
mostly accomplished through SMS texting, although it can also be
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76 Displaying the mobile network operator's logo is the most popular and
simplest adjustable form of content advertising. This is available as a text
message or a small monochrome graphic that ca n be simply updated with
the customer's own personalised message.
Handset producers, on the other hand, pioneered a more effective way of
product promotion by creating customised ring tones that distinguish one
brand from another. They also begin advertisi ng on their websites by
providing free downloading ring tones of famous tunes or melodies. They
did it for either a very modest service charge or for no charge at all. As a
result, their popularity and ranking among the general public rises. In
terms of co ntent advertising, the mass media campaign also played a
significant role. This type of advertising caught the attention of the masses
for a short period of time.
AIS, in cooperation with Honda, was the first international advertiser to
use the mobile's id le screen to display advertising.
The current trend in the phone service model involves ad -supported
content advertising. Almost all well -known network service providers
offer their customers discounted service in exchange for viewing a certain
number of a dvertising on their phones.
The content advertising method is always evolving, and it contains many
aspects such as 'one person per presentation' or 'people standing nearby.'
The goal in both scenarios is to offer the advertiser with many views per
present ation within a defined demographic area, but the techniques differ
slightly.

3.2.5 Pre – Test Methods :
An advertisement can be tested at two stages: (a) prior to the start of the
advertising campaign, and (b) after the start of the advertising campaign.
The first stage is referred to as "pre -testing," while the second is referred
to as "post -testing."
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77 Creativity The procedures for pre -testing are as follows:
1. Proposition Tests:
Proposition tests are tests of inventive strategies. The term "strategic"
refers to a different path of action that might be taken to determine the best
course of action. For example, a watch manufacturing company's
advertising campaign might use the following strategies:
(i) It's a fashionable watch for the fashion -conscious man.
(ii) It is a reliable timepiece.
(iii) It's a low -cost watch that appears like one that costs twice as much.
Each concept illustrates a distinct watch advertising strategy. Fashionable,
costly, and dependable appearance. To determine which is the most
repres entative sample of potential watch buyers, all three would be
displayed on separate cards as if they were different timepieces. Following
that, the sample respondents would be asked to choose between the
timepieces and provide their responses. As an advert ising approach, the
most broadly acceptable concept would be established.
2. Concept Testing:
This procedure is similar to Proposition Testing, except that instead of
placing alternative tactics on the cards, preliminary drawings of
advertisement concep ts are employed. Because the general public is not
used to seeing rough advertisement concepts, respondents must be
informed ahead of time that what they are about to see is an artist's rough
layout. Headlines should be displayed clearly, and irrelevant fe atures such
as cufflinks on a shirt should be avoided because they may cause
responders to be concerned about why they are there, whether they are
fashionable, and so on. Concept tests are used to assess the interest and
credibility of various marketing st rategies.
3. Sales Area Testing:
The most accurate way to determine whether or not an advertisement is
effective is to test it in one or two specific locations first. Because
effectiveness is first tested in a limited area, this testing is used to make it
easier to start large -scale advertising campaigns.
Folio testing are used for finished or nearly finished press advertising. A
folder contains a test advertising as well as a few other advertisements.
The resulting "Folio" is then presented to a limited g roup of consumers
who will be asked to respond. Later in the interview, the consumer is
asked to talk about the rest of the advertisement's appeal and motivating
power in generating curiosity and stimulating desire. Later in the
interview, the customer is asked to discuss the rest of the advertisement's
appeal and motivating power in generating curiosity, stimulating desire,
and attracting attention. This pre -testing strategy identifies the most
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78 5. Projections:
Consumers' homes are occasionally used to test television advertising
using portable movie projectors. Frequently, the commercial is
incorporated into a short scene from a film of amusement. After displaying
the clip to the audience, the interviewer inquires about their though ts on
the commercial.
6. Trailer Tests:
In trailer testing, a trailer or van is parked in a shopping center's parking
lot and visitors are brought in for interviews. On a rear screen projector,
everyone who enters the trailer is shown a television commerc ial and
questioned about it. This strategy is incredibly cost effective because it is
less expensive to bring individuals into the trailer for an interview.
7. Consumer Jury Tests:
Consumer jury tests are based on a typical group of consumers' ratings of
advertisements. The term "rating" refers to a comparison of one
advertisement to several others. A consumer jury test can be conducted in
a number of ways. The standard technique is to ask a small group of
consumers who represent potential product buyers t o rate various pieces of
text. A consumer jury test can be implemented using a variety of data
collection approaches. Personal interviews, for example, may be
employed, or a group could be formed and members asked to score the
alternative copy.
8. Rating S cales:
This form of copy testing necessitates the creation of effective copy
standards as well as numerical weights for each standard. The weights or
values represent a standard's relative importance in the overall success of
copy. Advertisements are then assessed on a scale of one to ten, and a
numerical score is calculated.
9. Portfolio Tests:
These tests are named by the packaging of the advertising being assessed.
A portfolio is a collection of ads, usually a variety of commercials to be
evaluated. Ad vertisements are sometimes printed in fake editions of
newspapers and magazines. Respondents are handed the folio and told to
read whatever piques their attention and take as much time as they desire.
After completing this activity, the participants are as ked to recall what
they can about the advertising.
10. Simulated Testing:
Simulated tests are direct mail point -of-purchase displays in which
consumers are exposed to alternate pieces of mail. These tests are easier to
set up and less expensive than true sales tests. They are, nevertheless,
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79 Creativity Pre-testing has a number of advantages :
i) To ensure that there are no clerical, grammatical, printing, or
technical problems.
(ii) To improve the effectiveness of communication from the perspective
of reade rs.
(iii) Reduce advertising waste.
(iv) To make it more effective and meaningful.
(v) It is straightforward, time -consuming, and cost -effective.
3.2.6 Post – test Methods :
Post-tests are tests that are conducted after the start of an advertising
campa ign. Post -testing allows researchers to examine the effects of
advertising on successful sales promotion. The procedures for post -testing
are as follows:
1. Recognization Tests:
In this procedure, respondents are asked to identify the contents of
adverti sing they may have seen. The goal of this experiment is to
determine the extent to which advertisements have an effective impact.
2. Recall Tests:
Unlike recognition testing, recall tests analyse the full advertising
campaign. Only specific adverts are ta ken into account. After an
advertising has been launched, recall tests are used to assess its attention,
intrigue, and memory value.
3. Inquiry and Coupon Response:
During inquiry testing, the advertiser provides the reader with a free
sample upon request . To take advantage of the deal, the reader must mail
the voucher. It's very conceivable that such adverts will appear in different
editions of the newspaper or magazine at the same time. The advertising
are coded in order to determine which of the many ad vertisements elicited
the most responses. It is thought that the ad that generates the most
enquiries is preferable to the others.
4. Split -Run Test:
This is an inquiry test that has been modified. An advertiser buys two ads
in a magazine that offers spli t-run options.The two adverts differ in only
one way, for example, one advertises a cold drink in a transparent bottle
while the other advertises a cold drink in a nontransparent bottle. It's a
keyed advertisement. Now, in two separate marketplaces, one fo r cold
drinks promoted in transparent bottles and the other for hot drinks, it is
assumed that the first campaign has been more effective than the second
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80 5. Psychological Tests:
A range of psychological tests, such as story telling, word association,
sentence completion, depth interviewing, and so on, are used. This test
aims to discover what the responder has seen in various advertising and
what those advertisements represent to him. Only trained interviewers are
permitted to conduct these examinatio ns.
6. Focus Interviews:
In this strategy, a group of consumers is contacted and requested to have a
thoughtful discussion about the advertising that have been provided to
them. The members of the panel are focusing on a specific part of the
advertising. The participants' opinions serve as the foundation for research
into the effectiveness of advertising.
7. Readership Test:
This method aims to investigate the role of advertising in raising consumer
awareness of a product.The readership test helps determi ne the relative
importance and efficacy of advertisements in the national newspaper. The
readers are asked where they saw the advertisement and how it helped
them become more aware of the goods.
The many approaches used to investigate the efficacy of an ad vertisement
provide information about the influence of an advertisement on product
awareness and changing consumer attitudes.
A. Post-Testing Benefits:
(i) Determine the amount to which the advertisement has been spotted,
shown, or read.
(ii) Determine how well the message is grasped by the audience.
(iii) To determine the advertising's memory value.
(iv) Determine the effect of advertising on customer purchasing habits.
(v) To see if the advertisement is achieving its goals.
(vi) To compare the effic iency of various advertisements in terms of
appeals, layout illustration, and so on.
(vii) To make future advertising attempts more effective.
3.3 SOCIETY Every day, advertising is a necessary part of existence. It is a widely used
marketing strategy in to day's society. Though the means by which
marketers promote have evolved over time, the role and purpose of
advertising has remained consistent. Modern society cannot exist without
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81 Creativity 1. Encourage others to buy :
Advertising's primary goal is to encourage consumers to buy goods and
services. Some businesses rely on advertising more than others: a cereal
firm, for example, must promote more aggressively than a power company
that faces littl e to no competition due to the wide range of rival products.
Advertisers frequently persuade members of the public to buy things by
establishing a sense of scarcity or shortage.
2. Cultural trends are reflected :
Advertising helps to bridge the cultural div ide by communicating different
cultures through advertising messages. It adds variety to one's social life.
3. Promotes Growth of the economy:
Advertising helps to promote the economy's overall development by
generating demand and stimulating economic acti vity. It also ignites the
desire to shop, which promotes the economy.
4. Increases standard of living:
Advertising is a commercial activity, hence it raises the level of living. It
gives folks the chance to increase their income. It encourages individuals
to buy more material goods, raising their living standards.
5. Improves emplyoment generation:
Effective advertising stimulates demand for goods and services, resulting
in employment. High demand necessitates increased output, which
necessitates additiona l physical and human resources, resulting in job
opportunities.
3.3.1 Socio – Economics Contribution of Advertising :
"There are two sides to every coin."
Critics praise advertising, but they also criticise it in their own unique
ways. Advertising has a lo t of positive effects as well as some negative
ones. John O' Toole, the President of the American Association of
Advertising Agencies, has described advertising as "something different."
It has nothing to do with studies, yet it does educate. It is not a n ews
organisation, but it provides all available information. And it isn't just a
gizmo that entertains people; it entertains everyone. Culture is the sum
total of tangible and ethereal ideals that constitute a way of life. It
encompasses art, literature, m usic (physical), knowledge, morals, customs,
and laws, among other things (intangible). It encompasses the entire
society's attitude and values, which are passed down from generation to
generation.
Culture includes habits, practises, attitudes, beliefs, a nd values.
Advertising is a cultural product. Advertising is a form of persuasion, yet
consumers still purchase just the things and services that they require.
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82 cycle, social int eractions, opinion leaders, reference groups, and other
factors influence consumer behaviour. With the passage of time, the value
system evolves. With these shifts in value systems, advertising's role
adapts to the changing circumstances. When a society ac cepts a set of
values, advertising as a social and corporate process strives to bring all
those goods and services that are made to respect those values.
Critics of advertising argue that advertising -supported mass media has
promoted what is popular rather than what is good, promoting
materialistic ideals rather than cultural values. They cite films and serials
that are shown on television and on the big screen that depict scenes of
rape, murder, and other acts of violence and crime as examples. However,
numerous social, religious, and educational organisations exist to guide
people in a given society's behaviour.
Supporters, on the other hand, argue that advertising improves cultural
values for the welfare of society. They cite advertisements for family
planning, drug misuse, noise pollution, and other public awareness efforts
as examples.
Thus, advertising preserves and improves cultural norms in a variety of
ways, but it may also be directly or indirectly responsible for the terrible
frenzy of materialism in some circumstances.
A. Economic role of advertising :
1. Product Value: The marketed products are not necessarily the best on
the market. There are also some unadvertised products that are acceptable.
However, advertising can assist improve the value of a product by
portraying a positive image of it, which in turn can persuade buyers to buy
it. Advertising informs consumers about the benefits of a product, hence
enhancing its perceived value. Mobile phones, for example, were formerly
considered a necessit y, but now they come with a variety of functions that
make them a method of convenience for consumers.
2. Price Effect:
Some promoted products are more expensive than unadvertised products,
but the opposite is also true. However, if there is more competit ion in the
market for certain products, such as canned juices from several brands,
prices will have to come down. As a result, some professionals, such as
chartered accountants and doctors, are prohibited from
advertising.However, certain items do not requ ire much advertising, and
even though their prices are high, they are still market leaders due to their
brand identity. Porsche automobiles, for example.
3. Consumer demand and choices:
Just because a product is highly advertised does not indicate that de mand
or, more specifically, consumption rates will increase. The product must
be unique, with higher quality and greater variety than competitors. For
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83 Creativity price ranges to cater to different age groups and, more recently, people
looking to lose weight, providing consumers a variety of options to choose
from.
4. Effect on the business cycle:
It is undeniable that advertising aids in the hiring of additional personnel.
It raises the pay scales of those who work in this profession. It aids
merchants in collecting more revenue, which they can put into improving
their products and services. However, advertisements have certain
negative consequences on the business cycle. Consumers may find that a
foreign product is superior to a national brand in some cases. This will
undoubtedly have an impact on production, which will, in turn, have an
impact on the country's GDP. The Abundance Principle, which states that
generating more items and services than the rate of consumption helps
keep consumers informed about their options and helps sellers play in a
healthy and competitive environment with their self -interest, supports the
economic elements.
B. Social Role of Advertising :
There are several advantages and disadvantages to advertising on social
media. The following are the details.
1. Deception in Advertising:
The buyer -seller relationship is maintained if the buyer is satisfied with
what they saw in the advertisement and what they received after
purcha sing the product. If a vendor advertises a product with a misleading
or deceptive image and an overblown image, the relationship between the
seller and the buyer cannot be healthy. These issues can be avoided if the
seller maintains a clean ad and displays the correct image of the goods.
2. Subliminal Advertising:
The major goal of these advertisements is to capture the minds of
consumers. The advertisements are designed in such a way that the
consumers are unaware that the advertisement has had an impact on their
brains, leading to the purchase of a product that they do not require.
However, "all advertisements do not always dazzle all consumers,"
because the bulk of consumers buy things based on price and necessities.
3. Our Value System is Affected:
Advertisers utilise puffing methods, celebrity endorsements, and
emotional play to make advertising so effective that people buy the things
like helpless victims.Poor people are encouraged to buy items they cannot
afford, and people are encouraged to start ha rmful habits such as smoking
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84 4. Offensiveness:
Some commercials are so obnoxious that purchasers refuse to buy them.
Denim jeans advertising, for example, featured women wearing very little
clothing and ma king a sex appeal. These advertisements have nothing to
do with the actual product. Then there are certain ads that are both
educational and now widely accepted. Previously, advertisements for birth
control pills were considered rude, but now the same adve rtisements are
considered educational and useful.
But, in the end, there are some significant beneficial qualities that assist.
The evolution of society and the advancement of technology
i) Employment
ii) Buyers are given options based on their own self -interest.
iii) Encourages healthy rivalry
iv) The standard of living is rising.
v) Inform people about social, economic, and health -related issues.

3.3.2 Criticism of Advertising :
Regardless of the many benefits that advertising provides, it is expos ed to
severe criticism from various social groups.
(1) Product Price Increase:
Because advertising expenses are a component of the total cost of the
product, it raises the price of the product. Consumers bear the brunt of the
price hikes. However, it cann ot be denied that advertising leads to large -
scale production, which lowers overall and per -unit production costs
significantly. Instead of paying more, the consumer may pay less.
(2) Multiplication of Needs:
Advertising creates fictitious demand for a pr oduct and encourages people
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85 Creativity minds of individuals to possess an item that they do not require because of
its repetition.
(3) Deceptive:
Advertising is sometimes used to deceive pe ople. False assertions are
made about a product's various virtues in order to persuade others to buy
it. Various vendors use deceptive and fraudulent methods to offer their
items. All of this has a negative impact on public trust in advertising.
(4) It Can Lead to Monopoly:
Advertising can lead to monopoly in a specific product brand. A huge
producer can eliminate small producers of the same product from the
market and create a brand monopoly by spending a lot of money on
promotion. This leads to consumer exploitation. However, this argument
does not hold water in reality. Manufacturers temporarily acquire
monopolistic capabilities as a result of intense rivalry from competing
producers of the same product. "Advertisement fosters competition," says
Marry He pner. It frequently enables small business owners to compete
with large corporations as well as launch new ventures."
(5) Harmful to Society:
Advertisements can be unethical and disagreeable at times. In order to
entice buyers, these frequently include in decent language and nearly naked
photos. This has a negative impact on societal values.
(6) Wastage of Valuable National Resources:
One important criticism levelled against advertising is that it reduces the
utility of certain products before they reach t heir usual lifespan. Older
models of a product are phased out in favour of newer and superior
models. People in the United States, for example, like to own the most
recent versions of cars while abandoning older models that are still usable.
As a result, n ational resources are squandered.
3.4 SUMMARY Consumer psychology is the study of how people make decisions about if,
what, when, where, how, and from whom they buy goods and services.
We analyse not just "why," "how," and "what" people buy while studying
consumer behaviour, but also "where," "how," and "under what
circumstances" transactions are made.
Consumer purchasing decisions are influenced by a variety of elements
including culture, subculture, social class, and personal aspects such as
age, income, occupation, life style, and personality.
Buying motives are the desires that drive people to make purchases.
Buying motives are divided into two categories: (a) primary motives and
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86 comfort, patronage motive, and other secondary buying motives are well -
known.
Advertisement testing is concerned with determining the effectiveness of
advertisements. An advertisement can be tested at two stages: (a) prior to
the start of the advertising ca mpaign, and (b) after the start of the
advertising campaign. The first stage is referred to as "pre -testing," while
the second is referred to as "post -testing."
In India, there are numerous advertising media options, including radio,
FM, and television. Ra dio broadcasting, the Internet, television, the press,
magazines and journals, and the Mural Advertising Act are all examples of
legalised advertising. However, no single medium can meet all of the
company's objectives.
3.5 EXERCISE Fill in the blanks :
Q1. ______________ advertising is directed at creating awareness about
social issues in the consumers.
1. Political 2. Social
3. Cultural 4. Financial
Q2. Advertising mainly has a ____________impact on consumers.
1. Psychological 2. Sociological
3. Economical 4. Technical
Q3. In ___________ method, the amount for advertising is decided on
the basis of sales.
1. Objective and Task 2. Competitive Parity
3. Affordable or fund available 4. Percentage of Sales
Q4. ___________ is the fastest growi ng medium in advertising.
1. Radio 2. Television
3.Outdoor 4. Internet
Q5. ___________test is conducted in different cities to find out ad
effectiveness.
1. Sales - area 2. Consumer jury
3. Check list 4. None of the above

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87 Creativity Match the column : SR.NO A B 1 Advertisement effectiveness a) Internet 2 Digital advertisement b) Rating 3 Consumer jury test c) Achieve awareness 4 Ofensivenss d) Brief 5 Radio commercials e) Vauge ads Answers 1- c, 2-a, 3- b, 4- d, 5 -e
True or False :
1) Music has no rele vance in most TV ads.
2) Readership Test of ad effectiveness was first developed by Gallup and
Robinson.
3) Digital media includes only advertising through websites.
4) Website is form of outdoor advertisement.
5) Television messages are not short -lived.
(All are False)
Shorts notes :
1) Television ads – Merits and Demerits
2) Internet Advertising
3) Pre – testing ads
4) Critisicms of Advertisng
5) Radio Advertisement – demerits
Answer in Brief :
1) Explain the elements and types of Copy
2) What a re the Post test Methods
3) Discuss the socio ecnomic role of advertisng
4) Explain the Broadcasting advertisment
5) Discuss the role of advertisement in society
*****
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88 4
SOCIAL AND REGULATORY
FRAMEWORK OF ADVERTISING
Unit Structure
4.0 Objectives
4.1 Introduction
4.2 Professional courses in advertising
4.3 Care er in advertising
4.4 Regulatory framework of advertising
4.5 Summary
4.6 Exercise
4.0 OBJECTIVES Regulatory framework of advertising: Legal Framework of Advertising,
Role of Information and Broadcasting Ministry (IBM), Self -Regulatory
Bodies - Advertising Standards Council of India(ASCI) and Indian
Broadcasting Foundation(IBF)
4.1 INTROD UCTION The advertising indus try is governed and controlled. The Indian
government has established a distinct ministry to support, oversee, and
manage advertising. Each of the advertising regulating and control
agencies will be discussed separately
4.2 PRO FESSIONAL COURSES IN ADVERTISNG  MBA in Advertising Management.
 B.Com in Advertising and Brand Management.
 BA Advertising and PR.
 Diploma in Public Relations and Advertising.
 Bachelors in Media Management.
 Diploma in Advertising and Marketing Communication .
 Diploma in Advertising (Public Relations and Business Studies)
4.3 CAREER IN ADVERTISING The advertising sector offers a wealth of options for career advancement,
making it a crucial job. The media, advertisers, advertising agencies, and munotes.in

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89 Social and Regulatory Framework of Advertising related servi ces make up the advertising sector. Each of these engaged
advertisers offers students a tough career path to choose from as they
expand their careers in this rapidly growing sector. 4.4 Regulatory
framework of advertising .
1) Advertising Agencies:
An adve rtising agency is a group of experienced marketers hired by a
client to devise, create, and execute an advertising campaign on the
customer's behalf.
It is estimated that there are over 4,000 advertising firms in India overall,
including studios and unaccr edited setups. There are 550 agencies that are
accredited or partially accredited. A greater rate of growth is being
observed in the number of new advertising agencies, particularly owner -
managed or one -man firms.
This is so because the advertising industr y offers a lot of room for
expansion and improvement. Strongly driven people with a strong sense of
conviction and belief in their ability to succeed despite all obstacles are
best suited for careers in advertising.
The annual billing for advertising agenc ies has increased dramatically, and
they currently total more over 2000 crores of rupees. In their functional
departments listed below, they are continually in search of talented and
imaginative personnel:
2) Account Executive:
In advertising jargon, "Acc ount" refers to "Customer," and an Account
Executive is the employee of the agency who is in charge of managing a
certain client. He approaches various potential clients in an effort to secure
fresh business for the advertising agency he represents. He ser ves as the
primary conduit between the client and the agency.
The position of account executive in an advertising agency is significant.
By pursuing new clients, he investigates the potential for securing new
business. Account directors are jobs that are p romoted from successful
account executives.
3) Copy Writer:
People with strong communication abilities have a greater chance of
becoming copywriters because copywriting is an art.
They support an advertisement's central idea. Most advertising agencies
have creative teams led by a copywriter or a visualizer. If the words are set
incorrectly, even a decent copy can be ruined. Unwise selection of
typefaces, widths, and weights can also ruin a layout. One becomes a
copywriter when they produc e persuasive copy for a client. The
copywriter's responsibility is to develop the concepts for the copy flat
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90 4) Visualizers:
Visualizers are the artists who put the copywriters' imaginative ideas on
paper. A successful advertisement is shaped by visualizers. The visualisers
frequently hold professional degrees in commercial or fine art. A
professional degree or diploma is not required to be a successful
visualizer. Layouting and visualising is a crucial career path.
5) Innovative Department:
The crucial department in an advertising agency is the creative
department. The concept or theme for the advertising campaign is created
in this division, and the entire advertising strategy is carried out there. Th e
director of the creative department is in charge. Visualizers, creative
artists, and copywriters make up the department, and their job is to
develop commercials. The copywriting and design are coordinated by the
creative director.
6) Production Departmen t:
There are also excellent career -building chances in the production
department. One section of the production department is in charge of
mechanically preparing the advertisement or printed material, while the
other section is in charge of overseeing the administration of the detail
work. Many employees work in the mechanical production area, dealing
with block -makers, printers, photographers, and DTP operators in the
design of printouts. A lot of production teams need help with the
advertising work and h andle the work in several languages.
7) Art Department:
The finished drawings from the approved layout are given to the artists to
prepare for reproduction. An Art Director is in charge of the art
department, and it is his responsibility to coordinate the work in order to
choose the best form of treatment in order to produce the visuals and then
the finished art.
8) Freelancers :
These are experts with a successful track record who work independently.
They include technical writers, jingle singers, radio a nnouncers, artists,
and copywriters.
Therefore, if workers in the advertising industry are aware of the full
societal implications of their work and understand their obligations to the
industry, it can be an interesting and fulfilling career.
4.4 REGULATO RY FRAMEWORK OF ADVERTISING One aspect of the right to information is advertising. Because it makes it
easier to spread information about who is offering what product and at
what price, advertising is an essential component of Article 19(1)(a).
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91 Social and Regulatory Framework of Advertising advertisements. The recipient's right to privacy is more significant than the
advertiser's right to free speech. In Tata Pres v. Mahanagar Telephone
Nigam Ltd., the supreme court noted that Article 19 (1)(a) not only
guarantees the right to freedom of speech and expression, but it also
safeguards the individual's right to hear, read, and receive commercial
communication. As far as a citizen's economic demands are concerned, the
information spread throug h advertising must serve as a guide for meeting
those needs. The audience for commercial speech could be more interested
in the message being delivered. As the consumer completely relies on the
information the marketer provides through his advertisement of the
specified goods, such deeper interest can be handled dishonestly by the
advertiser.
4.4.1 Legal framework of advertising :
The Indian Penal Code, 1860, for example, makes it a crime to advertise
any obscene publication or its distribution, sale, hire, or circulation, among
other things, in order to govern advertising in accordance with the self -
regulation code and other requirements. The Advertising Standard Council
of India has now established the code for self -regulation in pertinent
extracts of adve rtising. In accordance with its bylaws' Article 2(ii).
Three things will start to happen when the Code is more widely adopted
and actively followed.
Less deceptive advertising, fewer false claims, and rising respectability
To stop customers from being dupe d by such marketing, it is important to
identify the locations where warnings are needed. An actual illustration
would be the prevalence of advertisements for quacks posing as doctors on
train platforms and in the cars themselves. The most prevalent
commer cials are for abortion clinics and piles. Doctors are prohibited from
advertising by the Medical Council's Code of Ethics. Doctors who
promote their services or who take part in marketing to support a specific
drug, vitamin, or medicine face disciplinary p unishment. Real doctors
therefore do not promote. These charlatans prey on those who need
privacy for their issues. The Railway Administration, however, seems
unconcerned with these advertisements.
The 1954 Drugs and Magical Remedies (Objectionable Adverti sement)
Act. The Schedule to this Act bans the advertisement of any diagnosis,
mitigation, treatment, or prevention of certain diseases, disorders, or
ailments. This law's flagrant infringement is covered by a well -known case
law known as the Hamadard Dava khana case. The case's facts were that a
medicine was falsely represented as having the ability to treat specific
diseases in a magical way. The defendant was found responsible for these
false advertisements, the court ruled.
Cancer, obesity, fits, sexual dysfunction, medications to preserve or
improve sexual pleasure, or pharmaceuticals to cause miscarriage or
prevent conception are just a few of the 54 such illnesses and conditions
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92 According to the Act, breaking it would be a pun ishable offence. By
taking part in the advertising process, the medium that carries or displays
the advertisement also commits the crime. However, such advertisements
go unnoticed by the police. Newspapers, television networks, and
advertising agencies pri oritise the lucrative and recurring revenue these
advertisements create over following the law because it is profitable to do
so.
Why could ASCI be expected to take action when nobody is bothered by
such marketing, not even consumer organisations? Because ASCI was
founded particularly to promote self -regulation in the advertising industry
by businesspeople and manufacturers. Why should the entire complaint
process be made into a farce?
The Cola Wars would be a prime example. Can anyone dispute that these
colas are so essential to survival that their statements that they are
blatantly misleading? However, due to their size and influence, no one has
the guts to challenge them. Is this true.
4.4.2 Role of information and Broadcasting Ministry :
The Ministry of I nformation and Broadcasting (Ministry of I&B) is a
ministerial -level government department in India that is in charge of
drafting and enforcing legislation in the fields of information,
broadcasting, the press, and Indian cinema.
The term "Information" sho uld not be interpreted to mean only news
broadcasts or educational resources in its broadest sense. Instead, it should
be understood to include everything that is intended to be recorded
electronically, including correspondence, legal documents, official
records, and private discussions of news and opinions. It should also
include anything else that originates from a human being and is converted
into machine -recorded data.
After Independence, Sardar Vallabhbhai Patel served as this ministry's
first minister .
One of the most significant departments in the Union Government is the
Information and Broadcasting Ministry. In order to directly engage the
public, this ministry represents the government. This ministry is tasked for
disseminating information about go vernment policies, plans, and
programmes using popular forms of communication including dance,
drama, people, and Indian culture.
1) The ministry oversees matters relating to All India Radio and DD by
recognised national and regional political parties du ring elections to
lok shaba and state assemblies, as well as the protocol to be followed
by official electronics media during periods of national mourning
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93 Social and Regulatory Framework of Advertising 2) There are three functional divisions within the Ministry of
Information & Broadcasting: the Information Wing, the Broadcasting
Wing, and the Films Wing.
Information -Wing. The Press and Registration of Books Act of 1867, the
Press Council Act of 1978, and the distribution of newsprint to
newspapers are all admin istered by the Information Wing. The
Information Wing is also in charge of presenting and interpreting the
policies and activities of the Government of India through the print,
electronic, and digital media. It also develops policy guidelines for the rate
fixation of government advertisements on print, electronic, and online
platforms.
3) There are three functional divisions within the Ministry of
Information & Broadcasting: the Information Wing, the Broadcasting
Wing, and the Films Wing.
Additionally, it serves as the administrative arm for the following media
units: the Press Information Bureau, the Bureau of Outreach and
Communication (Directorate of Audio & Visual Publicity, Song & Drama
Division, Directorate of Field Publicity), the Publications Divisi on, the
Registrar of Newspapers for India, the Photo Division, the Indian Institute
of Mass Communication, Cadre management of the Indian Information
Service (Groups "A" & "B"), etc.
4) This ministry fosters a stable environment for the development of the
media and film industries and disseminates information about all
programmes, policies, and accomplishments of the government.
5) T o advance public broadcasting sectors and promote the Indian
broadcasting industry. Utilizing India's comparative advantage, this
ministry is now promoting the animation, VFX, and gaming industries as
part of the Make in India initiative.
6) The expansion of infrastructure assistance and the creation of
opportunities for young talents to enter the domains of print and electronic
media, films, and exhibit their potential are both facilitated by the
ministry.
7) Through film festivals and celebrations, good films, music, and film
culture are promoted. The Ministry of Information and Broadcasting
will receive Rs. 4361.67 crores fro m the government in 2019 –20.
Information technology plays a crucial role in communication, The
Ministry is in charge of running Prasar Bharati, the government of India's
broadcasting agency. The other significant entity under this ministry is the
Censor Bo ard of India, which controls the content of movies screened in
India.
Broadcasting FM Radio Phase(FM Radio Broadcasting Services Through
Private Agencies) Conditional Access System (CAS) Community Radio
Stations Prasar Bharati Doordarshan Akashvani (All In dia Radio) munotes.in

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94 Broadcast Engineering Consultants India Limited Uplinking/Downlinking
of TV Channels Content Regulation on Private TV Channels DIRECT TO
HOME(DTH) Internet Protocol Television (IPTV) Headend -in-the-Sky
(HITS) Digital television transition Radio And Television Licence Around
The World Broadcasting Authority of India Information Directorate of
Advertising and Visual Publicity (DAVP) Directorate of Field Publicity
Photo Division Publications Division Research Reference & Training
Division Song & Dra ma Division Office of the Registrar of Newspapers
for India (RNI) Press Council of India Press Information Bureau (PIB)
Indian Institute of Mass Communication (IIMC) Films Directorate of Film
Festivals (DFAI) Films Division (FD) Central Board of Film Certi fication
Children's Film Society, India Film and Television Institute of India (FTII)
Film Certification Appellate Tribunal National Film Archive of India
(NFAI) Satyajit Ray Film and Television Institute National Film
Development Corporation Mandate The m andate of the Ministry of
Information & Broadcasting are: News Services through All India Radio
(AIR) and Doordarshan(DD) for the people Development of broadcasting
and television. Import and export of films. Development and promotion of
film industry. Org anisation of film festivals and cultural exchanges for the
purpose. Directorate of Advertising and visual publicity DAVP
Handling of press relations to present the policies of Government of India
and to get feed -back on the Government policies. Administra tion of the
Press and Registration of Books Act, 1867 in respect of newspapers.
Dissemination of information about India within and outside the country
through publications on matters of national importance. Research,
Reference and Training to assist the media units of the Ministry to meet
their responsibilities. Use of interpersonal communication and traditional
folk art forms for information/ publicity campaigns on public interest
issues. International co -operation in the field of information & mass medi a
4.4.3 Self Regulatory Bodies :
The self -regulation system in the advertising sector is largely functional
and efficient. Self -regulation refers to the requirement that advertisements
adhere to a Code of self -regulation that has been established by numerou s
laws both domestically and internationally. This is done to uphold honesty
and integrity in the promotion of goods and services given to potential
clients in an effort to draw them in and purchase their items. It's true what
they say: the main purpose of advertising is to encourage people to buy
goods they don't really want. In such a scenario, advertising frequently
deceive consumers into purchasing items they do not actually need.
A number of media, including handbills, circulars, direct mail, billboard s,
signboards, newspapers, magazines, radio, television, the internet, and
others, can be used to market a good or service. There are many different
types of advertising, including competitive advertising, which contains
very little information about the a dvertisement and is used only to support
a producer maintain a share of the market. Comparative advertising
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95 Social and Regulatory Framework of Advertising 4.4.4 Advertising Standards Council of India (ASCI) :
For a fee, the Audit Bureau of Circulation, a research organisation with
over 44 years of experience in India, assesses the circulation of
newspapers and periodicals. Medium research organisations are
specialised organisations that gather data on various advertising media
(Ope rations, circulations, popularity, cost, etc.) and provide their clients
with the information they require. One of these organisations working in
India is ABC. People in the advertising industry took the initiative to
launch ABC. The ABC was founded in 194 8 as a voluntary, self -
regulatory, cooperative group of advertisers and publishers as a result of
their efforts.
The ABC is a non -profit organisation with limited liability that was
incorporated in 1948. A management committee oversees ABC's
operations. On the one side, advertisers and advertising agencies are
equally represented, as are nominees of publishers. ABC is a cooperative
organisation or an association of publishers of periodicals, advertising
agencies, and advertisers that disseminates informatio n about newspapers
and periodicals. Each publication provides this Bureau with periodic
information for this purpose.
Nearly every daily newspaper's circulation is audited by ABC, and all
significant newspapers are members of this Bureau. Only publishers w ho
receive reader payments for their publications are eligible to join ABC.
These publications cannot join this Bureau since they are given away for
free. In exchange for a fee, ABC offers its members an audited circulation
certificate every six months for significant national newspapers and
magazines.
The ABC carries out the following significant tasks:
1. The ABC employs a field operation that contacts distributors of
newspapers and magazines to gather circulation data for its published
members.
2. It disseminates data on the readership of different journals, as well as
publication members of advertisers and agencies.
3. It evaluates publications on its own and surveys people to determine
their reading preferences.
4. The ABC also evaluates how differe nt media outlets affect certain
societal segments. An advertiser can then get a trustworthy
comparative picture of the efficacy of various media.
5. The certified numbers published by ABC are used as the accurate
measure of the publication's readership an d popularity.
6. Using industry -standard methods such as mail interviews or in -person
interviews, the ABC gathers its data from the suppliers of magazines
and publications.
The ABC is crucial in delivering accurate and legitimate information
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96 foundation for purchasing advertising space in various newspapers and
periodicals.
Any publisher who is ready to adhere to ABC's policies respecting his
circulation data may become a member of the organi sation. Membership
in ABC is entirely voluntary.
4.4.5 Indian Broadcasting Foundation (IBF) :
Television has indeed played a significant part in influencing viewer
choices and educating the general public thirty years after the Indian
economy opened up to align with a contracting globe and the broadcasting
sector went from the state -owned Doordarshan to around 900 channels
today.
As the industry developed over time, the trade among broadcasters,
agencies, and advertising got sufficiently large but remained convoluted
and slow. A credit management system that followed a due process
between advertisers, media buying agencies, and themselves was required
by television broadcasters. In order to primarily meet this basic need, the
Indian Broadcasting Foundation w as founded in 1999. Members of the
IBF, a non -profit organisation, include both news and non -news channels
(GEC, Sports, Music, Movies, Infotainment, etc).
The IBF has put forth a lot of effort over the past 20 years to earn its
stripes and be recognised a s the leading organisation for television
broadcasters.
1) IBF members oversee 400+ channels and 91 percent of national
television viewership.
2) IBF members are admired throughout the world for their creative
business methods, involvement in the social sector, and commitment
to playing a significant role in the world's civil society.
3) The power of IBF member channels has increased over time, and they
now account for almost 95% of industry revenues, supporting millions
of jobs.
4) To assist in the cre ation of beneficial policies, the resolving of
problems, and the introduction of required reforms in the overall
system, BF offers research -based legislative inputs to the Government
and engages in lobbying on a variety of fiscal, regulatory, and other
business concerns.
5) Since June 2011, the IBF -created independent self -regulatory
authority, the Broadcasting Content Complaints Council (BCCC), has
started looking into content -related complaints against non -news
general entertainment television stations.
6) IBF represents its members' interests by ensuring that credit is
properly and expertly maintained between advertising, agencies, and
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97 Social and Regulatory Framework of Advertising 7) Through different Committee meetings and Forums, the IBF interacts
with members and develops strategi es.
A- Industry of Indian Television :
Today's typical viewer is not only overwhelmed by the variety of shows,
devices, and platforms available for watching content, but the journey has
also led to the creation of new benchmarks in line with the nation's di verse
cultures, languages, and topographies, making India the second -largest
television market in the world. There probably won't be another
phenomenon like this one in the near future. The impact of television on
people's lives and aspirations today is co nsiderable. Television is a
fantastic leveller because it has the singular ability to not only unite people
from all social classes and keep them together, but it has also had an
extraordinary impact on how people think, dream, aspiration, act, and
make de cisions.
It has been an interesting journey. The number of individuals who have
access to television has increased significantly; from 93 million in 2008 to
163 million in 2016, TV households have increased by almost 75%. This
is expected to increase. The nation as a whole has seen a huge increase in
the quantity of time spent viewing television. The weekly average was 139
billion minutes in 2008; this increased to 217 billion minutes in 2011, 286
billion minutes in 2014, and 647 billion minutes in 2016 - a phenomenal
increase of 365 percent over the 2008 data. This may help to explain why,
despite advancements in technology and the rise of OTP platforms, TV
viewership has not decreased in India.
Between 2015 and 2020, the sector is predicted to increase at a rate of 15.1
CAGR, reaching Rs 1098 billion.

Source: FICCI KPMG M&E Industry Report 2016
4.5 SUMMARY The code of self -regulation created for advertisers in India is far from
adequate, and the code needs to be followed with more sincerity.
However, when ever there is a competitive advertising environment, the
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98 advertiser. However, if these advertisers ever violate the public's trust by
running deceptive commercials, they should be thoro ughly investigated
right once to protect the interests of uninformed consumers. Furthermore,
ASCI, which is non -statutory and lacks binding authority over non -
members, should be replaced with a statutory regulatory body. The quality
of advertisements in In dia will undoubtedly improve as a result of this.
There are greater opportunities for false or inaccurate advertisements to
deceive consumers in the market. Self -regulation rules primarily forbid
parts of advertising that are deceptive or detrimental to so ciety.
4.6 Exercise Fill in the blanks :
a. The full form of ABC is ------------------ .
b. The I and B was introduced in ----------------------- .
c. The ABC is incorporated in -------------- .
d. Copy writing is ___________.
e. ______ rules primarily forbid parts of advertising that are deceptive or
detrimental to society
True or False :
1) Television and newspaper reporters are always ready to cover rallies,
protest marches or local body meetings with politicians/public
officials.
2) Readership of print media has declined even with effective and
appealing pictures, cartoons, graphs, maps, etc .
3) The latest technologies help media to reach out to the masses
4) The impact of ___________can be seen on the billboards,
newspapers, periodicals, CDs, D VDs, television programmes, films,
etc
5) It is very important that the information provided by media is
__________________.
Match the column : Group A Group B a) raised and carved designs of seals pressed on wet clay or wax global culture b) Gutenberg Media c) communication technology governance and administration d) main source of information printing marks e) Media brings out the defects printed Bible munotes.in

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99 Social and Regulatory Framework of Advertising Shorts notes:
1) Career in advertising
2) ABC
3) IBF
4) Self regularaties in India
5) Industry in Indian Television
Answer in Brief:
1) In electronic media, television is very important Justify your answer .
2) Justify the statement “On one hand, technology has improved the
efficiency of media and on the other, media updates us on the
adva nces in technology .
3) Audit Bureau of Circulation (ABC)? Explain its functions .
4) Explain the legal side of advertising.
5) What is the importance of IBF
*****

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100 5
SALES MANAGEMENT - I
Unit Structure
5.0 Objectives
5.1 Introduction
5.2 Sales Force Management
5.3 Summary
5.4 Exercise
5.5 Reference
5.0 OBJECTIVES After studying this unit, the students will be able to:
 Understand the features, functions and imp ortance of sales
management.
 Get an insight into the concept of Art of Selling, its types and process.
 Learn sales force management, selection process and qualities of
effective salesman.
5.1 INTRODUCTION The word sales management is a combination of two w ords i.e., sales and
management. Sales is the art of planning in the mind of another, a motive
which will induce favorable action.
The committee of American Marketing Association has defined it as
“Selling is the personal or impersonal process of assistin g and or
persuading a prospective customer to buy a commodity or a service or to
act favorably upon an idea that has commercial significance to the seller.”
Hence, “Sales management is the planning, direction and control of selling
of business unit includ ing recruiting, selecting, training, equipping,
assigning, routing, supervising, paying and motivating as these tasks apply
to the personnel of sales force”.
Sales management originally referred exclusively to the direction of the
sales force. Later the term took on broader significance in addition to the
management of personal selling. Sales management meant all marketing
activities, including advertising, sales promotion, marketing research,
physical distribution, pricing and product merchandising.
5.1.1 Meaning of Sale Management :
Sales management is a business discipline which is management of a
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101 Sales Management - I used in sales. This is a crucial aspect of the business as net sales of
products and services draw profit for the business. Sales manager is hired
to look after the sales and to manage them.
Sales Management is about coordinating across all the sales efforts in the
company to make sure to achieve sales targets, sales promotion activities
etc. Sales management should be well integrated with marketing
strategy as well as distribution strategy of the company.
Sales management is the process of developing a sales force, coordinating
sales operations, and implementing sales techniques that allow a business
to con sistently achieve, and even surpass, its sales targets.
“The attainment of sales forces goals in an effective and efficient manner
through planning, staffing, training, directing, and evaluating
organizational resources.” Charles M. Futrell, Fundamentals o f Selling
5.1.2 Features of Sales Management
1. General Management:
Sales management includes understanding the importance of sales and
monitoring and explaining market trends to sales personnel. Sales
managers provide direct supervision to salespeople an d are responsible for
salespeople learning and implementing any and all company sales
methodologies and initiatives.
Sales managers must understand and clearly communicate sales budgets,
their significance and what they mean to each salesperson.
2. Struct ure:
Sales management follows well defined organization structure. Sales
managers create sales team structures. Common sales team structures
include:
 Sales Managers
 Assistant Sales Managers
 Team Leaders
 Sales Personnel
All employees must clearly unders tand their responsibilities and what's
expected of them in terms of performance as well as how to accomplish
their assigned duties. Sales managers help sales personnel understand their
place in sales departments as well as organizations as a whole.
1. Sales Strategy:
Sale management included formulation of sales strategy. Sales managers
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102 Advertising and Sales Management assign sales territories, plan product promotions and design or obtain sales
tools such as posters and p rinted literature.
Moreover, sales managers create sales campaigns, which include direct
mailers and telephone solicitation. Sales managers set organizational
standards for customer service and building customer loyalty.
2. Recruitment of Sales Personal:
Effectively hiring salespeople is among the most critical characteristics of
sales management. Recruiting top sales performers, as well as those with
star potential, is an ongoing, constant process and every organization has
room for more successful sales people.
Sales managers must work at maximizing their hiring skills, including
conducting quality interviews and identifying potentially successful
salespeople.
3. Sales Training:
Sales management emphasis on training of sales personnel. Sales
managers mu st effectively train their sales team. How to implement sales
techniques, such as qualifying prospects; how to build product value; and
how to close deals are all key components of effective sales training.
Sales personnel must learn effective time manage ment, because top -
performing salespeople consistently invest their time actively engaged in
activities that directly produce income.
4. Motivation:
Sales managers must identify what motivates sales team members and
design selling strategies accordingly. I nterpersonal communication and
relationship building skills are required, as sales managers must help
salespeople create energy and gain momentum during times when they're
struggling. Motivational techniques include group recognition, financial
rewards and valuable prizes for outstanding sales performance.
5. Consumer Welfare:
The sales management is not only confined to self -centered corporate
goals of profit and sales maximization and sustained growth. It goes well
beyond these towards consumer welfare, satisfaction, delight and
maximum social advantage by making available the goods and services to
the needy customers in the right time and at reasonable prices, at the place
wanted .
6. Customer Oriented:
Sales management is expected to be customer -oriented . It produces what
is needed by the customer in the quest for maximum social welfare.
Customer delight is the fundamental guiding principle of sales
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103 Sales Management - I 7. Challenging Function:
Sales management is a challenging function. It is responsible for obtaining
sales volume, handling sales operations so as to make contributions to
profits, and for ensuring continuous growth. Sales executives assure the
delive ry of products with customer satisfaction .
8. Subsystem of Marketing:
Sales management is an integral subsystem of marketing management. It
translates the mar keting plan into marketing performance. The sales
managers are subordinate to the marketing manager. They advise the
marketing manager on the areas of sales force management .
5.1.3 Functions of Sales Management :
Sales management is viewed as having a systematic relationship with each
other. All functions and activities are considered as a dynamic process,
composed of numerous interrelated parts, aiming to achieve the
organizational s ales objectives. The following are the functions of sales
management
1. Sales Planning:
Sales manager performed the function of sales planning. It is considered
as a crucial function of sales management as it lays the foundation of
other activities relate d to sales. Sales planning involves:
 Formulation of sales strategy
 Setting sales target
 Sales forecasting
 Demand management
 Execution of sales plan
Sales planning involve preparation of sales plan. It is strategic document
that outline the business targets , resources required and defining various
activities related to sales. Sales planning should be in line with
organization’s marketing plan, strategic planning and the business plan.
It should clearly specify how the objective of organization can be
achieve d through actual sale of products and services.
1. Recruitment of Sales staff:
The sales manager recruits human resources required for the various
activities of sales. The sales manager search for the competent
manpower for the sales job and stimulate the m to apply for the job.
The prospective candidates are assessed on the basis of various
parameters like skills required for the job, education qualification,
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104 Advertising and Sales Management 2. Training and Develop ment:
There is a need for training on continued basis in the field of sales and
marketing. The organization must organize training programme for their
sales and marketing personnel. It will help in improving knowledge,
attitude, skills and social behavior of sales representative.
For instance, a training programme can be organized for new recruits in
sales department to make them familiar with company’s products, sales
territories, local languages etc.
3. Sales Research:
The sales department must underta ke sales research. The sale research
helps in understanding customer’s taste and preference, particular trends,
feedback and suggestion from dealers and customers etc.
It will facilitate sales department in framing sales strategies. It also helps
organiza tion in marketing mix decisions with respect product, price,
place and distribution.
4. Sales Forecasting:
The sales forecasting is important function of sales department. The sales
department predicts the sales of the company like monthly sale forecast,
quarterly sale forecast and annual sale forecast. The different methods of
sales forecasting are used for the said purpose. The sales forecasting
gives directions to sales department in achieving their sales goals.
5. Sales Strategy:
When the team is read y for sales performance, it requires proper guidance
and support. Therefore, the sales manager needs to prepare a sales startegy
which provides a sequential presentation of the steps involved in the sales
process, right from lead generation to cracking the deal successfully.
6. Setting Sales Targets:
The sales department set the sales target for the sales personnel. The
sales targets are decided on the basis of sales forecasting. The sales
target can be for weeks, monthly, quarterly and annually. The sales
targets should be specific, measurable, attainable, realistic and time
bound. For instance, sales target can be to sale 10 units of products ‘X’
in one week.
7. Reward Systems:
The sales manager prepared reward and incentive systems for the sales
person nel. The effective reward system drives the sale of the products in
the market. It also brings motivation amongst sales representative. The
reward system can be in the form of cash incentives over and above
basic salary, sponsored vacations, gift vouchers, higher promotion etc.
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105 Sales Management - I 8. Sales Correspondence:
The sales correspondence is one of the important functions of the sales
department. The sales department must give reply of any incoming letter
in prescribed time. The reply should be tactful, simple in lan guage,
helpful and every customer must feel that his enquiries being considered.
For instance, if the promises cannot be kept with regard to delivery date or
other matters, the customers should be informed immediately and
whenever practicable reasons for the delay should be given.
9. After Sales Services:
It is underlying principle that after sales service is the duty of sales
department. The manufacturer is very much particular about their
products are being installed properly. This is not only a service to the
customers but also a protection against complaints and general dissat -
isfaction of the customers.
The manufacturers, therefore, maintain a staff of skilled engineers and
mechanics, who carry out tests at the customer works, give technical help
and advice and see that product is functioning properly.
5.1.4 Importance of Sales Management :
1. Assist Marketing Management:
Sales management assist and aid marketing management. Sales
management helps the marketing and selling plans to convert or transfor m
into profitable actions. Sales managers can attain sales target by proper
knowledge of marketing and selling.
2. Management of Sales Teams:
Sale management facilitates effective management of sales teams. Sales
manager is responsible for all the activit ies such as
 Recruitment and Selection
 Training & Development
 Performance appraisal
 Compensation of the salespeople
Through this function, the sales manager decides or choose the best
possible employees for the work in an organization.
3. Induced Higher S ales:
Sales management induced higher sales. Effective sales manager inspired
the sales people such that they have passion to sell the product or have
curiosity to attain sales. Sales manager should have a team that should be
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106 Advertising and Sales Management 4. Training and Development:
Training and development is one of the crucial parts of the sales
management. It will help to increase the skills, knowledge, and abilities of
a particular sales personnel so that he can provide an appropriate solution
to the customers.
5. Brand Image:
Sale management helps in enhancing brand image of the product. Sales
managers inform the customers of the upcoming products. The customers
are induced to buy the product because of the brand image and better
performance over pr olong period of time can result in goodwill of the
product among the customers and intermediaries. For instance, Apple (I
phone), Kellogg’s cornflakes, and so on.
6. Sales Data:
Sales management enable organization to collect sales data. The role of
the s ales manager is to collect the information related to consumer tastes
and preferences, income occupation which will give idea related to
consumer purchasing power that can affect the selling process.
7. Evaluation of Sales Performance:
Sales management he lps in evaluation of sales performance. By evaluation
of a sales performance, the sales department will try to understand whether
there are deviations between actual sales and desired sales. If so than
immediate corrective measures need to be adopted.
8. Formulation of Business Plans:
Sales management facilitates in formulation of business plans. The sales
department presents information relating to sales, product, competition,
estimated profits, consumer behavior, dealer relations, etc. from time to
time. The Sales Manager provides information, ideas, and facts for
business plans and policies formulated by top management.
9. Economic Development:
Sales management facilitates in economic development of nation. Sales
management sets highly realistic sales and profit goals leading to sustained
growth. It improves the quality of products, brings innovations, searches
new markets, creates new demand, and generates additional jobs in the
country. It serves as a source of energy to the growth of the national
economy.
10. Customer Relationship:
With greater competitive pressures, the selling task will become
increasingly difficult and complex. Successful companies will distinguish
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107 Sales Management - I Thus, managing the salesforce will become more important to the ongoing
success of most companies. The success of sales management depends
largely on their ability to enable, support and assist salespeople in
developing profitable relationships with their customers.
5.1.5. Introduction of Art of Selling :
Prof. William J. Stanton has defined selling as, "Selling is the personal
communication of information to persuade a prospective customer to buy
a service or idea."
American Marketing Association has defined it as, "Sell ing is an oral
presentation in a conservative with one or more prospective customers for
the purpose of making sales."
Prof. Philip Kotler has defined selling as, "Selling is face to face
interaction with one or more prospective purchasers for the purpose of
making presentation, answering questions, and procuring orders.
Selling is a face -to-face selling technique by which a salesperson uses his
or her interpersonal skills to persuade a customer in buying a particular
product. The salesperson tries to highl ight various features of the product
to convince the customer that it will only add value.
However, getting a customer to buy a product is not the motive behind
selling every time. Often companies try to follow this approach with
customers to make them aw are of a new product. The company wants to
spread awareness about the product for which it adopts a person -to-person
approach. This is because selling involves personal touch; a salesperson
knows better how to pitch a product to the potential customer.
Selling can take place through two different channels, through retail and
through direct -to-consumer channel. Under the retail channel, a sales
person interacts with potential customers who come on their own to
enquire about a product. The job of the salespe rson is to make sure that he
understands the need of the customers and accordingly shows various
products that he keeps under that category. Under the direct channel, a
salesperson visits potential customers in an attempt to make them aware
about a new pro duct that the company is launching or it may have a new
offer which the customers may not get from the open market.
5.1.6 Types of Selling :
1. Transaction Selling:
Transaction selling is a simple, short -term sales strategy that focuses on
making quick sa les. In this type of sales model, neither the buyer nor the
seller has much interest in developing a long -term relationship.
Transaction selling works well with simple, commodity products. Since
the product is generally available from multiple sources and is
indistinguishable from competitive products, the sale is made on price and
availability. Sales representative generally have minimal interaction with munotes.in

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108 Advertising and Sales Management the customer. Marketing typically informs the customer and drives
demand.
Transaction selling is most often found in retail environments where the
customer has a good idea of what he wants and asks salespeople simple,
clarifying questions.
2. Relationship Selling:
Relationship selling usually involves simple or moderately complex
products. Often the deal s involve larger unit volumes or greater revenue.
In a relationship selling model, the salesperson develops professional
relationships with buyers at their target customers. Relationships are
typically based on familiarity, likeability and ultimately trust .
When a customer has a buying need, the buyer explores the market,
shopping for competitive prices and availability. When the buyer has
found reasonable purchase options, he or she offers the relationship
salesperson a “last look” at the opportunity. If t he salesperson can meet
the competing offers, he will win the deal. If not, the buyer will purchase
from one of the competitors.
3. Partnership Selling:
In a partnership selling arrangement, the seller becomes an important part
of the customer’s team. The salesperson is selling a complex solution that
is integral to a customer’s success.
An example of a sales partnership may be the sale of GE jet engines to
Boeing. The success of both GE Aircraft Engines and Boeing depends on
the engines fitting on and wo rking perfectly with the Boeing airframe.
This type of sale relies on a long -term, valued partnership between both
parties. Often, partnership sales take years to develop.
4. Informative Selling:
Salespeople with informative sales styles educate customers about a
company's offerings, but they tend to have fewer interactions with
customers. This style is popular among sales professionals who are selling
to a diverse audience. For instance, salespeople using informative sales
styles on infomercials or sales networks where the seller is explaining the
benefits of a product or service.
5. Persuasive Selling:
Some salespeople intend to persuade customers to buy a product or
service, using strategies like presentations, customer success stories or
data points, l ike projected return on investment (ROI). Persuasive selling
strategies are popular in areas where there are many customers and there's
limited time to capture and maintain their attention.
For instance, mall kiosks, market stalls and tourist areas are pl aces one
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109 Sales Management - I 6. Need Oriented Selling:
Needs -oriented sellers often adjust their sales pitches to address the
perceived needs of their clients or customers. They can improvise
responses, solve problems quickly and explain why their product or
service is a good fit, offering ideas for how a customer could buy and use
the product or service.
One might see a needs -oriented sales approach in settings where
salespeople have time to design individualized experiences f or customers
or where customers approach salespeople with questions or problems.
Customer service representatives are examples of professionals who often
make sales by responding to the needs of a customer, as are sales
associates in stores or chat boxes f or online retailers.
7. Collaborative Selling:
Collaborative sales styles can be effective strategies for those interested in
building relationships, finding solutions that work for their customers and
taking a more informed and academic approach to sales . Collaborative
sales professionals often aim to educate and help their customers, and they
work to establish trust early in the relationship. Collaborative sales
approaches may require larger time investments than other styles, but the
result may be a cus tomer who feels understood.
Collaboration often exists when the salesperson and the client can work
together to find a mutual solution that best addresses the client's needs and
the salesperson's goals. This sales style values interaction, making it
appli cable to consultants, custom -product retailers and other sales settings
where representatives have large amounts of time with a single customer.
8. Social Media Selling:
Online and social media marketing techniques often include profile
building, networki ng and content creation. Many social sellers strive to
present their products in a subtle, conversational style, which can work
well if social media sellers have a large social media following or if target
audience is primarily online.
Social media influe ncers are an example of sales professionals who use
this selling style to connect with their customers. In this selling strategy,
it's common for sellers to make the buyer -seller relationship less obvious
by incorporating sales into their regularly produce d content and marketing
themselves as fellow users rather than sales representatives.
9. Substantive Selling:
Another less direct sales style is the substantive style. Professionals with
this style often prioritize relationships with customers more than s ales, so
customers often perceive substantive -style salespeople as reliable and
loyal. Quality products and services, established territories, selling
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110 Advertising and Sales Management in substantive sales. Examples o f substantive sellers are partner relations
specialists or account managers.
10. Actionable Selling:
Action -oriented sellers are high -achieving professionals interested in
selling to top decision -makers. Those with this sales style are often
commission -motivated and exceptional at creating a sense of urgency for
their customers by implying scarcity of a product or service. Professionals
who use this style are often confident and highly motivated, viewing sales
as exciting challenges and responding to sales leads quickly. Ticket sales,
event registrations and subscriptions are some places where one might see
this style in use, but actionable sales styles exist across many industries.
5.1.7 Selling Process :
Sales are the lifeblood of any organization and mana ging the sales process
is one of the most important functions of any business.
1. Identifying Prospecting Buyer:
The first stage of selling process involves identifying potential customers.
All prospects identified may not turn out to be actual customers. Hence
identifying the right prospect is essential as it determines the future selling
process.
Marketers tap different sources to identify the prospective customers.
Marketers search for prospects in directories, websites and contact through
mail and tel ephone. After identifying the prospect, the sales person
qualifies the prospects on the basis of their financial ability, needs, taste
and preferences.
2. Preparing for the Sale:
This step consists in finding and analyzing information regarding
prospects specific product needs, current brands being used; feelings about
other available brands and personal characteristics. This information is
used in selecting an approach and in creating a sales presentation.
The more information about a prospect that a sal esman has, the better able
he is to develop an approach and presentation that precisely communicates
with the prospect.
3. Pre-approach:
The next step to prospecting and qualifying is pre -approach. At this stage
the salesperson needs to decide as to how t o approach the prospective
customer. The salesperson may make a personal visit, a phone call or send
a letter, based on the convenience of the prospects.
4. Approach:
At this stage the salesperson should properly approach the prospects. He
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111 Sales Management - I The salesperson’s attitude, appearance, way of speaking matters most at
this stage.
5. Presentation:
At this stage the salesperson provides detailed information about the
product and benefits of the product. The salesperson narrates the features
of the product, explains the benefit and the worth of the product in terms
of money.
6. Overcoming Objections:
After presentation and demonstration, when customers are asked to place
order, they are reluc tant to buy and raise objection. Customers give
importance to well -established brands, show apathy, impatience,
reluctance to participate in the talk etc. Customer may raise objection with
regard to price, delivery schedule; product or company characterist ics, etc.
Salesperson handles such objections skillfully by clarifying their
objections and convinces the customer to make purchase.
7. Closing the Sale:
After handling objections and convincing customers to buy the product,
the salesperson requests the c ustomer to place order. The salesperson
assists the buyer to place order.
8. Follow up:
Immediately after closing the sale, the salesperson should take some
follow up measures. The sales person assures about delivery at right time,
proper installation, af ter sales service. This ensures customer satisfaction
and repeat purchase.
9. Account Maintenance:
While account maintenance is listed as the final activity in the selling
process, it really amounts to the beginning of the next sale and, thus, the
beginn ing of a buyer -seller relationship. In selling situations where repeat
purchasing is a goal (compared to a one -time sale), following up with a
customer is critical to establishing a long -term relationship.
In recent years, the selling process has changed d ramatically as the vast
majority of sales take place online or over the phone instead of in person.
And in response, sales management systems have become more
technologically sophisticated.
5.1.8 Qualities of an Effective Salesman :
1. Listening Skills:
The sales personnel should have listening skills. A good sales person
needs to satisfy client’s needs. He should listen to his client carefully and
talk whenever is required. A good sales person isn’t talking always. A
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112 Advertising and Sales Management 2. Honesty:
The customer highly appreciates honest sales representative. It is
expected that sales personnel will give true and fair view of the products.
He should not hide any important and relevant information about the
product form the client. It is more relevant in the case of financial
products where there were many instances of miss -selling by sales
representative. The honesty on the part of sales personnel creates good
and favorable image about product in general and about company as a
whole i n the mind of customers.
3. Empathy:
Empathy is the ability to understand other people’s problems and views.
A sales person should be empathetic towards customer’s needs. It helps
in anticipating what customer’s needs and wants in advance. It also
facilit ates in preparation of sale presentation.
4. Networking:
Networking is one of the important traits of the sales person. A good
sales person loves to network. It is advisable for the sales person to get
involve in their sale community and tries to have man y business
relationships. It will bring more contacts which will generate more leads
for the sales person.
5. Enthusiasm:
A successful sales person is always motivated. He is always ready make
a sale at any given moment. He should constantly look for poss ibilities.
An enthusiasm on the part of sales person encourages customer to buy or
a place an order of the product.
6. Forecasting:
The crucial part of sales management is forecasting future sales. The
sales manager must develop skills of sales forecasti ng. The sales
manager should have sound knowledge of different methods of sales
forecasting. It will help in various activities related to sales like sales
planning, scheduling, directing, recruitment etc.
7. Emotional Intelligence:
Emotional intelligence is important for sale people but critical for sales
manager. During sales, it will enable sales manager to overcome
objections of potential clients. It also helps sales manager in knowing
how and when to motivate, support and console sales team in order t o
maximize their performance.
8. Ability to Challenge:
An effective sales manager should act like a mentor who challenges and
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113 Sales Management - I who is respected and has an outstanding and accomplished his tory in the
field of sales. They should possess effective interpersonal skills.
9. Adaptability:
The profile of the sales team can vary from person to person. One may
have seasoned sales professionals with decades of experience sitting
alongside passionat e, ambitious college graduates starting their first sales
role. The organizations look for sales managers who can adapt their
leadership style to motivate sellers with different levels of experience and
backgrounds.
10. Team Leader:
Many top sales people prefer to work alone. They prefer the independent
feeling of being on the phone or out on the road pursing their own
prospects. But sales management requires sales manager to work closely
with people. Not only they have to work with sales team but also nee ds
to report upper management on a regular basis. Sale manager needs to
communicate regularly with the team members. It shows that the sales
manager really cares about sales team.
5.2 SALES FORCE MANAGEMENT Businesses are under the misconception that as lo ng as they design a good
sales strategy, everything is all set. But that’s not the case. Firm need to
also hire a good team to ensure that strategies are being implemented. Like
Steve Jobs said, ‘Ideas are worth nothing unless executed.’ That is why
sales force management should be firm’s priority.
Sales Force management is the development of a sales force that includes
coordination of sales operations, as well as the training and application of
sales methods that result in achieving sales goals and objecti ves.
Sales Force Management is a sub -system of marketing management. It is
sales management that translates the marketing plan into marketing
performance.
5.2.1 Meaning of Selection :
Selection means selecting the fixed number of suitable candidates from
those who applied for the posts. Selection process starts as soon as
recruitment ends. Recruitment considers all applications received in a due
date while selection considers only the required number of most suitable
candidates.
There is no ideal selection process that most companies can follow.
Normally, for selecting salesmen, the simple and short selection process is
followed. However, some companies, when more salesmen are to be
selected at time, also follow lengthy and systematic selection process.
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114 Advertising and Sales Management 5.2.2 Steps in Selection Process:
1. Receiving Applications:
Applications are received from eligible candidates for the salesperson job.
The candidates might have been asked to send their applications in a plain
paper along with their bio -data. Some organiza tions make available what
are called ‘Application Blanks’, which may be obtained on payment of the
prescribed fee.
2. Screening Applications:
The applications received from all the candidates for the salesperson job
will then have to be processed. Incompl ete applications will be set aside.
Applications of those candidates who fail to fulfill the eligibility criteria
will be not be accepted for the salesperson job.
3. Preliminary Interview:
Interview is, by far the most important part of selection procedur e. The
panel of experts decides the number of candidates to be called for
interview and letters are sent to the candidates well in advance.
4. Written Tests:
All the eligible candidates for the salesperson job may then be called for a
written test. The te st paper usually contains two parts, objective and
descriptive questions. The objective questions may test the candidate’s
knowledge of English, mathematics and also his level of general
knowledge. The descriptive part will test the candidate’s ability to draft a
letter and prepare a general essay.
5. Final Interview:
The candidates who have been successful in the written test during the
salesperson selection process will then be called for an interview.
Interview is a face -to-face oral examination of the candidate. The
candidate may be asked questions on a wide range of subjects like politics,
sports, marketing, banking and so on.
The objective of interview is to test the candidate’s ability to face a panel
of experts and communicate his ideas. The interv iew will help the
employer to know whether the candidate is a shy person or is bold enough
to undertake any assignment. The candidates, who are going to be selected
as salesperson, shall possess good communication ability.
6. Reference Checking:
Applicant s for jobs of salesperson are usually asked to give the names of a
couple of eminent persons in their applications. Such persons, who are
called referees, may be contacted by the employer to know the conduct
and character of the candidate.
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115 Sales Management - I 7. Medical Exam ination:
Successful candidates for the salesperson job shall be medically examined
to find out whether they are physically fit. The candidate’s height, weight,
eyesight, etc., are checked. Physical fitness is important for any kind of
job. It is even more important for a salesperson as he has to undertake lot
of traveling.
8. Final Selection:
Candidates found to be medically fit may be appointed on probation for
the salesperson job. Probation is the initial training period during which
the salesperson has to learn his work and also perform to the satisfaction
of the employer. The period of probation may vary from six months to two
years.
Only those salespersons, who have lived up to the expectations of the
employer, during the period of probation, will be retained. During
probation, the salesperson usually gets a consolidated salary. He will be
put on scale of pay only on confirmation of his service.
5.3 SUMMARY Sales management is the process of hiring, training and motivating sales
staff, coordinating op erations across the sales department and
implementing a cohesive sales strategy that drives business revenues.
The benefits of effective sales management include:
 Increased sales revenue and profitability
 Improved sales forecast reliability, thereby reduc ing revenue
variability
 Better satisfaction and loyalty both from customers and staff
 Reduced staff turnover and therefore reduced recruitment and
retention costs
 Increased productivity per staff member
With the internet at their fingers, customers are mor e sophisticated than
ever and they expect companies to meet that level of sophistication. They
want to be able to communicate with and source information from
businesses quickly and easily; they want customer service online and
through social networks as w ell as over the phone.
Sales representatives also want and expect advanced tools to help them do
their job well. Cloud and mobile applications and access to high quality,
real-time customer information have moved from nice -to-have to
essentials of the sale s toolkit.
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116 Advertising and Sales Management 5.4 EXERCISE Fill in the Blanks
1. _____is discipline of maximizing benefits a company and its
customers receive from the efforts of its sales force.
a) Sales Management b) Human Resource Management
c) Financial Management d) Production Managem ent
2. Sales management is the _____of a sales staff, and the tracking and
reporting of the company’s sales.
a) Strategy b) Training and management
c) Management d) Controlling
3. ______is the fundamental guiding principle of sales management.
a) Customer del ight b) Customer orientation
c) Client satisfaction d) Client feedback
4. _________is a sub -system of marketing management.
a) Sales force management b) Financial management
c) Human Resource management d) Coordination management
5. ______means selecting t he fixed number of suitable candidates from
those who applied for the posts.
a) Selection b) Recruitment
c) Job profile d) Job description
Answers:
1. Sales Management
2. Training and management
3. Customer delight
4. Sales force management
5. Selection

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117 Sales Management - I Match the col umn : Column A Column B 1. Receiving applications A. Qualities of effective sales person 2. Honesty, Empathy B. Function of sales department 3. Prospecting C. First step in selection process 4. Sales forecasting D. Mall kiosk, market stalls, tourist areas 5. Persuasive Selling E. First step in selling process
Answers:
1. C, 2. A, 3. E, 4. B, 5. D
True or False :
1. Sales management follows well defined organization structure.
2. Board of Directors performed the function of sales planning.
3. Sales management enable organization to collect sales data.
4. Action -oriented sellers are high -achieving professionals interested in
selling to top decision -makers.
5. Networking is one of the important traits of the sales person.
Answers:
1. True 2. False 3. True 4. True 5. True
Short Notes :
1. Features of sales management
2. Significance of sales management
3. Types of selling
4. Qualities of effective salesman
5. Art of selling
Answer in brief :
1. Define the term Sales management and also explain its characteristics.
2. What is Art of Selling? Disc uss the process of selling with suitable
example.
3. Define the term selections and also explain the process of selection.
4. “Salesman should possess various types of skills” Substantiate.
5. Discuss the functions of sales management.
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118 Advertising and Sales Management 5.5 REFERENCES Online Libra ry:
1. https://ndl.iitkgp.ac.in/
2. https://www.britishcouncil.in/library/online -library
3. http://infolibrarian.com/dlib.html
Reference Books :
1. Richard R. Still, Edward W. Cundliff, Normal A. P Govoni, Sandeep
Puri (2017), Sales and Distribution Management: Decisi ons,
Strategies, and Cases, Pearson; Sixth edition.
2. Nag A., Sales and Distribution Management, McGraw Hill Education,
New Delhi
3. Havaldar Krishna K / Cavale Vasant M, Sales and Distribution
Management Text and Cases, 2nd ed., McGraw Hill Education, New
Delh i
4. Thomas DeCarleo, Sales Management, Wiley India, 10th Edition.
5. Aftab Alam, Sales and Distribution Management, Wisdom
Publication, 2006 Edition.
6. Patrick Forsyth, Sales and Management Training, A. Maya Gover
Publication, Edition 2001.
7. Aswathappa, K., Human Resource Management, Tata McGraw -Hill,
New Delhi.
8. Dessler, G. and Varkkey, B., Human Resource Management, Pearson
Education, Delhi.
Websites:
1. https://epgp.inflibnet.ac.in/
2. https://dictionary.cambridge.org/dictionary/english
3. https://www.collinsdictionary.com/dictionary/english
4. https://www.investopedia.com/terms/
5. https://www.yourarticlelibrary.com
6. https://www.economicsdiscussion.net
7. https://businessjargons.com/
8. https://smallbusiness.chron.com/
***** munotes.in

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119 6
SALES MANAGEMENT - II
Unit Structure
6.0 Objectives
6.1 Introduction
6.2 Sales Organization
6.3 Summary
6.4 Exercise
6.5 References
6.0 OBJECTIVES After studying this unit, the students will be able to:
 Understand meaning of sales training and di fferent types sales training
methods.
 Explore various motivational factors and compensation methods of
sales personnel.
 Comprehend structure and steps in developing a sales organization.
6.1 INTRODUCTION The world of sales management is developing fast. It is undergoing
tremendous changes due to advancement of technology. It is no longer
restricted to selling the product to customer but great deal emphasis is
given on development of sales personnel and sale organization.
Sales is life blood of any organizat ion. It is actual sales that bring revenue
to the organization which further will be used for expansion and
modernization. Sale management is backbone of marketing management.
It became effective when organization give attention to motivational
factors inf luencing sales personnel. The various types of compensation
methods for sales personnel also bring competitive advantage to the firm.
The structure of the sales organization plays crucial role in the
development of organization. This unit focuses on human resource and
organization structure of sales management.
6.1.1 Meaning of Sales Training :
Sales training involves the personal development of skills and techniques
related to creating and exploring new sales opportunities, as well as
closing sales for an o rganization.
Sales training is a process of providing the sales force with specific skills
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120 According to National Society of Sales Training Executives, USA , “Sales
training is the intentional and sound application of ordinary sense to the
problem of helping the sales personnel to make the most of their talents.”
6.1.2 Techniques of Sales Training :
Selection of the right training method is vital. Before choos ing a method,
it is essential to know which method will offer the best skill and learning
development to the trainees. The training method is also geared to
generate the right attitude in the trainees that would enhance the
acceptability of training. The d etails of the training methods are explained
below:
1. Lecture Method:
The lecture method presents the needed information on selling skills and
techniques to the trainees. Sales trainees learn ideas about selling as a
functional component, managerial pr actices of selling, different underlying
problems of selling, creativity in selling, role of selling in cross -functional
interaction, etc. A participative environment is created in the lecture
method, where trainees can be actively involved by listening to the
lectures, writing notes, asking questions, clearing doubts, and getting
suggestions.
Often written materials and instruction manuals are handed to the
participants. Some instructors take help of the audio -visual aids to animate
the lecture sessions an d arouse a deep interest among the trainees.
Company executives, senior man agers, professional trainers, guest
lecturers with huge experience in the marketing discipline are invited to
act as speakers in the lecture sessions.
2. Conference Training:
Conf erence is a platform for discussing various issues on a topic. As a
training medium, it provides the right ambience for interaction between
the trainees and the trainers. It is a group meeting which has pre -planned
items for discussion. The discussion can flow on multiple tracks revolving
around the issue. The conference coordinator or the leader presents the
connective link between these different points of discussion.
In sales training, conference method gives opportunity for an all -round
discus sion veer ing around specific products or services that sales trainees
will sell in future. Sales management and territory management are also
discussed in the conference proceedings. The entire session is controlled
by a chairperson who sums up the discussion in th e conference.
3. Case Study:
Case study is a written description about a real life or hypothetical selling
situation or a sales problem that is discussed in a classroom. The trainees
have to sincerely listen to and understand the various issues in the ca se.
After this, they need to relate to these issues with personal selling concepts
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121 Sales Management - II case study. The case discus sion tries to highlight the problem areas,
diagnose the inputs of pers onal selling discipline and offer solutions to the
problems. Salespeople are allowed to throw their views to gain
confidence.
4. On-the-Job Training:
On-the-job training is a popular technique that gives opportunities to new
employees to gather hands -on learning experience. In the selling context,
newly recruited salespeople get a scope to observe the approaches of
senior salespeople, sales supervisors when they interact with customers.
These new salespeople are asked to minutely watch the discussion from
where they can get an idea of how to deal with the present and prospective
customers.
Next, the sales trainees are allowed to make sales calls in the presence of
senior sales personnel. After the completion of calls, the seniors discuss
the mistakes of the salespeople and advise on how to improve a specific
sales situation. This, in fact, motivates the trainees to sell more, and learn
from their faults. Modern day training programmes are more interactive in
nature. Particularly in the field such as – sales, these newer methods have
proved of immense use.
5. Audio -Visual Oriented Training:
These training methods are lively and interesting demonstration of films,
power points, audio cassettes, videos, etc. It gives the trainees a chance to
have a look at the charts, graphs, tables, slides, talk show, buyer -seller
interaction, interview of a marketing expert or consultant, a meeting
session with the dealers, some realistic buying -selling situations, etc.
These methods, when integrated with lecture -based trainin gs, create a
highly stimulating training environment where trainees get the opportunity
to learn both theoretical and practical applications of selling.
Newly recruited salespeople are exposed to computer -based training
(CBT), DVD systems or other multimed ia applications that simulate
unique buying -selling situations. These training devices, though
expensive, are highly effective because of the practical orientation and the
short learning time available. In fact, multimedia applications have
revolutionized the simulated training methods where the sales trainees get
advanced training through e -learning modules and e -performance support
system (EPSS).
Videoconferencing is becoming popular today and is effective for long -
distance communication. This training me thod combines video
presentations and computer -aided questioning techniques. In this
technique, questions are displayed on computers regarding how to manage
a particular sales situation, how to take decisions in problem -oriented
situations, etc. Web -based training and video conferencing are useful in a
decentralized training technique where trainees stay geographically
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122 6. Management Games:
Computerized management ga mes are used by some firms where trainees
are divided into groups with each group having five to six participants.
Games take place amongst these groups after creating a simulated
marketplace situation. The competition judges the teams on the most
effectiv e decision taken on sales budget, selling expenses, sales turnover
ratio, etc.
7. Role Playing:
In role playing, an artificial environment of the realistic sales situation is
created and salespeople are asked to sell a product to an imaginary
prospect. Tr ainees are asked to assume the role of salespeople and
prospects in rotations. So, the trainees find an opportunity to replicate the
buying -selling session that they will face in real -life situations. Trainers
closely monitor the session and guide the trai nees on how to improve in
different scenarios. The objective is to develop skills in trainees in
managing and controlling the sales situations. Trainees also learn to handle
problems.
8. Group Discussion Method:
In this method of training, different group s are formed by limited number
of persons (15 -20). Each group seeks guidance under the leadership of a
senior officer. The group discusses the sales problems with the leader and
efforts are made to find out a commonly agreed solution to each problem.
Durin g group discussions, everyone gets an opportunity to learn from the
ideas of others.
9. Job Rotation Training:
This method is used to provide knowledge to the trainees in respect of
functions of different departments; such as, research department, account s,
advertising, purchase, packaging and public relations, etc. Job rotation
training is organized on the basis of a well -planned training programme.
This type of training develops the practical knowledge of the trainees on
different aspects of sales.
10. Personal Discussion:
In this method of training, salesmen contact with his Sales Managers and
Senior Managers from time to time and discuss with them the individual
problems. The Managers give good advices and suggestions, on the basis
of their experience in the field. The guidance relating to marketing their
effectiveness, route planning, call scheduling, management of sales
timings, and other matters related to sales are given by the Manages to the
sales trainees.
11. Correspondence Courses:
When the sal es trainees are appointed to work at distant place from the
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123 Sales Management - II them to assemble at the headquarters or at a place fixed for training. In
such cases, training is imparted through co rrespondence. The training
materials are printed and circulated to the sales trainee at different places
where they are working. The trainees read the materials carefully and
learn to adopt or follow the guidance and instructions received through the
study materials, in practice. If they find any problem in understanding the
contents of such training materials, clarifications are sought through
correspondence.
6.1.3 Motivating the Sales Force :
Motivation in the sales function refers to the amount of effort a
salesperson is willing to expend in the selling job. While some
salespersons are self -motivated, there are others who need to be motivated
to perform.
Factors affecting Motivation of Sales Force :
The successful salesperson is a driven individual. Her un flagging
eagerness, willingness to seize opportunities and stubborn persistence are
what make her a superior performer in workplace. These traits, while they
may be partially inherent in her personality, require fuel to keep the
salesperson working at her highest level. This fuel is motivation and exists
in many forms tied to incentives and rewards for a job well done.
1. Basis Salary:
The most common way of motivating anyone in any profession is through
basic salary. A salesperson is especially conscious of that because his
income increases when he closes a sale. The knowledge that the more he
sells, the more he makes is the impetus for seeking more potential
customers, retaining current clients, marketing of the product and finding
other methods of increa sing sales.
2. Awards:
Awards are incentives for the salesperson to work at the highest possible
level. A manager can create contests for the top salesperson of the week or
month in which he can give a prize. Cash awards are most highly valued
by salesper sons. If firm unable to provide a bonus, it can offer other
incentives. The prize can be simple, such as a prime parking spot, small
gift card or trophy. The pride involved in being the best can be motivator
for sales force.
3. Sales Training:
A key sales person knows the value of training others. Trainees benefit
from the knowledge imparted by an experienced worker in sales while the
trainer derives increased motivation from teaching others how to work
successfully in her field. The salesperson's desire is naturally increased by
the self -esteem boost he receives from the peers he is training. The peer
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124 4. Conventions:
A well -planned convention can provide help in motivating salespeople to
raise their leve ls of performance. The presentation of new techniques, the
camaraderie and sharing of ideas between peers and the breaking of the
regular business routine is important in instilling renewed excitement in
sales team. Allow sales person to implement what the y had learned from
conventions and watch their progress in becoming more polished
professionals.
5. Autonomy:
Give sales workers the flexibility to develop their individual strategies for
their job. Let them design their own pitches, help create their lis t of
potential clients. This flexibility illustrates firm’s trust in their abilities and
provides them with the freedom they need for their own self -belief.
6. Team Spirit:
Many salespeople are perceived as hard -working go -getters who prefer to
work alone . The nature of a sales position attracts people who are
independent and prefer working by themselves. However, there are many
salespeople who do not fit neatly into that stereotypical image. They are
motivated by the social aspects of being part of a te am and contributing to
the team’s success. These people may get satisfaction from group problem
solving, contributing to a co -worker’s success, or even playing a major
role at a sales meeting. The firm can:
 Hold frequent sales meetings or social functions
 Get them involved in team projects
 Build in team incentives
7. Challenging Opportunity:
Many salespeople are driven by opportunity. What constitutes an
opportunity varies from person to person. However, motivational
opportunities usually fall into the categories of challenges, and the
possibility of improving one’s situation on the job or in life in general. The
firm should try to create an environment that offers opportunities.
8. Collaborative Competition:
Salespeople are competitive by nature, but g oing head -to-head with each
other can create negative motivation. It drives some to disregard their
colleagues and others to resent their colleagues. Foster collaboration above
competition, and it’s more likely everyone will be motivated. The goal is
to compete against competitors, not each other. Encourage collaboration
by rewarding mentoring, knowledge -sharing and efforts to work together
to overcome the competition.
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125 Sales Management - II 9. Participation in Management:
While salespeople need to find meaning in their work, they need to feel
their work is valued by their management and company to stay
motivated, a study by the American Psychological Association. The
following are some ways to make salespeople feel valued:
 Involved in decision -making
 Offer growth and advanceme nt opportunities
 Create flexible work arrangements
 Compensate fairly and adequately
10. Encouraging Initiative:
In the same as collaboration, encourage salespeople to be entrepreneurs by
cultivating ideas to grow business. Give them the time, freedom and space
to try their ideas. Reward them for bringing new ideas to increase market
share and find new customers. Give larger rewards for ideas that are
implemented and even larger rewards for ideas that work.
6.1.4 Compensating Sales Force :
Sales compensation is the combination of base salary, commission, and
incentives that are used to drive the performance of a sales organization.
A sales compensation plan is the individual plan for a sales representative
within sales organization, and it should be designed with specific concepts
and components in mind, based on their role within the sales cycle, types
of sales engagements, seniority, and more.
A. Types of Sales Compensation Plan :
1. Straight Salary:
It is the most common method for remunerating sales force. Here,
payment made to salesman is called salary. Mostly, salary includes basic
pay plus dearness allowance. The salary is the payment made to a person
for carrying out his job or performing his duties over a given period of
time.
It is based on total time or units of time (for example, days, weeks, or
months) spent on the work. For example, salary is paid monthly, weekly,
fortnightly, or may be any other duration of time. Salary is paid according
to fixed scale of pay. It involves a stable and guaranteed p ayment
regardless of amount of work. It is free from business fluctuations.
2. Salary Plus Commission:
This is a popular and widely practiced method or plan to remunerate sales
force. Under this method, over and above fixed and regular salary, a
salesman is paid commission, too. Rate of commission may be fixed or
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126 satisfies both a new salesman, and experienced and enthusiastic salesman.
All other selling expenses and fringe benefits ar e paid extra, directly or
indirectly. The strongest aspect of this method is that it combines elements
of a regular fixed payment and an incentive to do better.
3. Commission Only:
Commission only plans do not have a base salary. Sales personnel are only
paid when they make a sale. There is no guaranteed income. If sales
personnel don’t make any sales, they do not get paid. While they are
simple enough to manage, it can be challenging to attract salespeople to
work in these roles.
4. Point or Merit Based Method:
In India, this is not a popular method. It is relatively a new method to
remunerate salesmen. Here, amount of remuneration to be paid to
salesmen depends on merits, marks, or point the salesmen have obtained.
Company fixes rate per merit/mark/poi nt in advance and communicate the
same with salesmen. Opinion of salesmen may be considered to decide the
acceptable rate or price of each unit. Amount of salary can be arrived at by
multiplying points with rate per point.
5. Territory Volume:
This is com mon in companies that take a team -based sales approach. Total
sales for a given territory are tallied up at the end of the sales period and
sales representative are paid commission equally.
For example, if a company has 5 sales representatives working in a
territory and they sell Rs.100,000 of business during a pay period, each
sales representatives receives Rs. 20,000.
6. Profit Sharing:
This is not much popular mode of payment. It is not a part of regular
payment to salesmen. Profit sharing is used occa sionally or in exceptional
cases. Profit sharing can be linked with salary and bonus, commission and
bonus, or salary, commission and bonus, or with any other combination.
This benefit is offered either on product -wise profits, territory -wise profits
or total profits. It is not obligatory on part of a company. It depends on
attitude and intension of management. If there is adequate profit, and if the
company wants to share the profit with salesmen, profit sharing is
possible. Normally, a company shares cer tain per cent profit equally
among salesmen.
7. Draw against Commission:
This is a type of commission only plan. Employees are provided with a
pay advance at the beginning of each pay period, which acts like a form of
base pay. At the end of the pay perio d, this amount is deducted from the
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127 Sales Management - II advance. The main issue with this plan is employees could actually owe
money if they don’t sell enough.
8. Bonus:
Remuneration to salesmen consists of fixed salary/commission and bonus.
Note that bonus is different than commission. Bonus is paid over and
above the usual salary paid to salesmen. It is paid for achieving certain
results beyond specific limit. Commission is paid on the basis of volume
of sales while bonus is paid for fulfilling a certain sale quota. Note that
bonus is not as powerful as commission. Generally, bonus is paid for
following activities:
 Bonus is paid for performing certain promotional activities.
 Achieving extraordinary sales volume.
 Obtaining certain number of new customers.
 Cutting down selling expenses etc.
6.2 SALES ORGANIZATION In the words of C. L. Boiling, “A good sales organisation is one where
functions of departments have been carefully planned and coordinated
towards the objective of pulling the product in the hands of the customers,
the whole effort being efficiently supervised and managed so that each
functions is carried out in the desired manner.”
In the words of H. R. Tosdal, “A sales organisation consists of hum an
beings working together for the marketing of products manufactured by
the firm or the commodities which have been purchased for resale.”
In the words of Stiff, Cundiff and Govoni, “Sales organisation is both an
orienting point for cooperative endeavour and a structure of human
relationships. It is composed of the group of individuals, striving jointly to
reach qualitative and quantitative personal selling objectives and bearing
both informal and formal relations to one another.”
6.2.1 Objectives of Sales Organizations :
Sales objectives are used by management to supplement the vision and
goals they have set for the company and sales department. The sales
objectives outline the specific, measurable actions each employee must
take to achieve the overall goal .
For example, let's say the sales team has a goal of increasing revenue over
the next six months. To reach this goal, each salesperson's objective is to
increase the amount of revenue they bring each month by 2%.
“The object of sales organisation is not m erely to sell goods to distributors
but to get them consumed or get them into use”. The responsibility of the
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128 1. Development of Specialist:
Sales organization facilitates development of special ist. As a business
expands, marketing and selling activities multiply and become
increasingly Complex. One objective of recognizing the sales
department is to facilitate the assignment of responsibilities and delegation
of authority. This requires reshapin g the structure so that it is easier for
specialists to develop.
2. Defining Authority:
A sales organization help in defining the various types of authority. Sales
executives should know whether their authorities are line, staff, or
functional. Line autho rity is the power to execute orders. Staff authority is
the power to suggest. Functional authority enables specialists in particular
areas. Salespeople receive directions from several resources. All sales
officers should understand the nature of their auth ority with respect to
each aspect of the operation.
3. Concentrate on Core Functions:
Sales organization enable top management to focus on core functions. As
a sales department’s operations and activities increase, additional
subordinates are added. This permits top sales executives to delegate more
authority. It also allows for the more effective use of specialization. This
helps executives devote less time to routine operations and more on
planning.
4. Demand Creation:
Sales organization help firm in cr eation of demand of product in the
market. The demand of the product is created to lead to sell in the market.
When a product is manufactured in the factory, it is not sold automatically.
Salespersons push the product to consumers. But even they cannot for ce
the consumer to buy the product. The sale depends on the consumer’s need
and perception. This need is created by the selling skills, promotions
through advertisements, etc., which in turn help in creating demand in
market.
5. Fulfillment of Received Ord er:
This is an important function of sales organization where the salesperson
has to answer the calls and queries of the customers, receive orders and
make the product ready as per the demand of consumers. Finally, the
products are packed and dispatched a s per the expectation of consumer; all
these are imperative and effective tasks.
6. Credit Recovery:
Sales cannot always be done for cash. Bulk sales are made on credit. It’s
very difficult for an organization to perform only on the basis of cash
sales; i n this competitive market, credit sales play a crucial role. After the
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129 Sales Management - II very challenging task as the salesperson has to retain the business and still
get the task done.
7. Personnel Management:
Every sales organization wants best sales personnel to enhance the sales.
This depends on training. The sales organization has to select, train,
motivate, monitor and control its sales personnel. Here the company has to
make an investment in s ales personal.
8. Lead Conversion:
Sales organization facilitates in lead conversion. Sales organization bridge
the gap between customer needs and the product that fulfils that need. The
job of the sales organization is to close the deal by introducing fu rther
information and helping the customer in buying decision. This is often an
attractive aspect for customers, as they may view the sales organization as
the expert, which builds credibility and therefore trust.
9. Customer Retention:
Sales organization help in customer retention. Excellent sale organization
are those that not only make the sale but create a long -lasting impact on
the customer. Long term customer relationships lead to repeat custom,
referrals and increase the brand’s reputation by word o f mouth. One of the
keys to customer retention through sales is to perform sales follow -ups.
Setting up after -sales calls or meetings is an effective way to maintain and
build a positive relationship and gives the customer an opportunity to
feedback their experience of the product or service.
10. Business Growth:
Sales organization play a key role in the building of loyalty and trust
between customer and business. Trust and loyalty are the main reasons
why a customer would choose to recommend company to a friend or
family member or write a great review of product or service online. In the
digital age, they are extremely influential, due to the reach and power of
social media and online media. During sales interactions, encouraging the
customer to recommend a friend or give positive feedback can have an
impact on the growth of the business through increased brand awareness
and sales.
6.2.2 Structure of Sales Organizations :
1. Geography or Territory Organization Structure:
This is basic and most common form o f sales organization structure in
which sales department is divided on the basis of geography or territory.
It allows each sales person to develop familiarity with a specific
geographic location. They can build rapport with local businesses, get to
know re gional competitors and track target accounts etc. It can be easier
for company to evaluate sales representative by taking into account the
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130 2. Product and Service Line Organization:
This organization structure suitable for company dealing in multiple
products or services. The sale representatives are aligned for particular
product or service. Similar to geographical expertise, it allows sales
representative to become the expert on a spec ific product, thereby better
able to communicate its value and use case for individual clients.
3. Customer or Account Size Organization:
The organizing sales department on the basis of customer or account size
is another popular structure. In this struct ure, sales representative is
assigned particular customer mostly corporate or business house on the
basis of their size. These business houses may have different goals, will
ask different questions, and have very different budgets. By allowing sales
repres entative to become familiar with the intricacies of these accounts,
organization can meet the needs of the customer and sales representative.
This sales structure is ideal for Business -to-Business transactions.
4. Industry or Vertical Organization:
The di fferent industries used the same products in different manner. For
instance, the simple computer can be put to use for different activities
and purposes. In this structure, sales representatives are well trained to
position the products or services as per the needs of the particular
industry. It helps in developing expertise of sales people about particular
industry, their trends, eco -systems etc.
5. Assembly Line Structure:
The Assembly Line is named for its linear structure and specialized
process that d ivides the sales process of an organization. Each step of the
line is a specific job associated with the sales cycle, with people who
specialize in each sales task. Usually, these assignments are divided into
the following areas:
 Lead Generation Team: Peop le on the Lead Generation Team
researches potential prospects, gathers information around their needs
and pain points, and then organize the data for the team to optimize
prospecting for the department.
 Sales Development Team: Employees that concentrate on sales
development take the initial research forwarded from the Lead
Generation Team and qualify prospects. Qualifying the prospects
could include calling the lead in addition to research. The Sales
Development Team forwards only the qualified leads to the accounts
team.
 Account Executive Team: The Account Executives are the closers.
They take the qualified leads and pursue the sale. From product
demonstrations, responding to prospects’ questions and overcoming
objections , these employees sign the account and pass them along to
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131 Sales Management - II  Customer Success or Support Team: This part of the team
specializes in helping customers s ettle into the new product or service.
Their job is to keep customers happy, educate customers on the value
the product or service provides, and uncover new opportunities to
deepen the relationship.
6. The Island:
The Island gets its name because each sal es representative is on their own
in the sales process. Unlike the Assembly Line style, the sales
representative is responsible for all of the tasks associated with the sales
cycle, from generating and qualifying leads, to closing the business and
identify ing upselling opportunities. Some joke this sales team structure is
called the island because the sales representative must sell or die. When it
comes to the Island sales team structure model, it works for any company
that still relies on its founder as th e primary salesperson. Additionally, the
Island works for organizations that cannot afford to hire more than a
handful of sales representatives for their sales team.
7. The Pod:
In this structure, small groups of sales professionals that specialize in
certain sales process tasks work together to achieve sales goals . Each pod
usually includes employees that generate leads, qualify leads, close
business, and onbo ard new customers. The Pod sales model mixes the
concepts behind both the Assembly Line and Island sales team structure
models; the specialization of sales tasks comes from the Assembly Line,
but the individual achievement of the pod takes after the Island sales
structure. Pod Sales is a natural progression for organizations that employ
the Assembly Line style of sales structure. It also works well when the
sales team is enormous already, or the organization has the resources to
hire a larger staff to conce ntrate on sales.
8. Decentralized Team Structure:
Decentralized Team Structures have sales team members posted at various
locations at strategic points. These posts could be regional, state -wide or
national. All of the team members are focused on sales fo r their strategic
area. Decentralized teams increase the reach of the organization. Also,
clients often enjoy excellent customer service. In addition, sales
representative enjoy freedom to work the way they want and with fewer
hours spent travelling. In ad dition, the organization reduces travel costs
while increasing sales with a local presence.
9. Centralized Team Structure:
Centralized Team Structures keep the sales team in one place and usually
are run by one person who makes the decisions. This type of structure
often has the owner at the center of the team. Centralized Teams often
excel at making decisions quickly because the decision maker is present.
Also, centralized teams are usually better for organizations where the
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132 vision. Organizations with a centralized structure also reduce conflict
while maintaining control of their organization. This is because structure
reduces any ambiguity, which boosts accountability for the result s.
10. Committee Sales Organization:
The committee is never the sole basis for organizing a sales department. It
is a method of organizing the executive group for planning and policy
formulation; while leaving implementation of plans and policies to
indiv idual executives. The committees usually found in sales organizations
include training committee, customer relations committee, personnel and
merchandising committees, committee on new products, etc.
6.2.3 Steps in developing Sales Organization :
A sales or ganisation is an organisation of individuals either working
together for the marketing of products and services manufactured by an
enterprise or for products that are procured by the firm for the purpose of
reselling.
1. Define Objectives:
The first step is to define the sales department’s objectives. Top
management defines the long -term objectives for the company, and from
these, the objectives for the sales department are derived.
Top management, for instance, may want the firm not only to survive but
to achieve industry leadership, develop a reputation for outstanding
technical research, diversify its product lines, provide excellent service to
customers, furnish investors with a generous return, establish an image of
public responsibility, and so on.
From such composites, sales management determines the implications for
the sales department and articulates a set of qualitative personal selling
objectives. Three of the sales Department’s general objectives, all
traceable to management’s desire for survi val of the firm may be summed
up in three words: sales, profits, and growth.
2. Determination of Activities:
Determining the necessary activities and their volume of performance is a
matter of analyzing the sales department’s qualitative and quantitative
objectives. The activities involved in modern sales management are
similar from firm to firm, and although individual sales executives think
that their operations are different, most differences are more apparent than
real.
3. Grouping of Activities:
The activities are classified and grouped so that closely related tasks
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133 Sales Management - II sufficient number of tasks but sufficient variation to provide for job
challenge, interest, and involvement.
Certain activities are of crucial importance to the success of the sales
department, and this has implications for organizational design. For
example, in a highly competitive field, product merchandising and pricing
are assigned to position high up in the organiz ational structure and
activities of lesser importance are assigned to lower -level jobs.
4. Assignment of Personnel:
The next step is to assign personnel to the positions. This brings up the
question of whether to recruit special individuals to fill the po sitions or to
modify the positions to fit the capabilities of available personnel.
On the one hand, some position requirements are sufficiently general that
many individuals possess the necessary qualifications, or can acquire them
through training. On th e other hand, some individuals possess such unique
talents and abilities that it is prudent and profitable to modify the job spec -
ifications to fit them. Nevertheless, planners prefer, whenever the situation
permits, to have individuals grow into particula r jobs rather than to have
jobs grow up around individuals.
5. Coordination and Control:
Sales executives who have others reporting to them require means to
control their subordinates and to coordinate their efforts. They should not
be so overburdened wit h detailed and unde legated responsibilities that
they have insufficient time for coordination. Nor should they have too
many subordinates reporting directly to them. This weakens the quality of
control and prevents the discharge of other duties. Thus, in providing for
coordination and control, consideration must be given the span of
executive control.
6.3 SUMMARY Sales training is a process by which an attempt is made to develop the
selling skills so as to increase the ability, knowledge and experience of the
salesmen. Sales managers can motivate their team by following any of the
theories of motivation, namely, Maslow's hierarchy of needs theory,
Herzberg's two -factor theory, goal -setting theory, expectancy theory, and
job design theories.
Sales organizat ion is both an orienting point for cooperative endeavor and
a structure of human relationships. It is composed of the group of
individuals, striving jointly to reach qualitative and quantitative personal
selling objectives and bearing both informal and for mal relations to one
another.
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134 6.4 EXERCISE Fill in Blanks
1. _______involves the personal development of skills and techniques of
sales personnel.
a) Sales training b) Production training
c) Finance training d) Operation training
2. _______is a written desc ription about a real life or hypothetical
selling situ ation or a sales problem that is discussed in a classroom.
a) Case study b) Lecture method
c) Conference method d) Counselling method
3. _______is the combination of base salary, commission, and
incent ives.
a) Sales compensation b) Remuneration
c) Bonus d) Dear allowance
4. A _______is an organisation of individuals either working together
for the marketing of products and services manufactured by an
enterprise.
a) Sales organization b) Finance organiz ation
c) Digital organization d) Virtual organization
5. _____Team Structures keep the sales team in one place and usually
are run by one person who makes the decisions.
a) Centralized b) Pod
c) Island d) Committee
Answers:
1. Sales training
2. Case study
3. Sales compensation
4. Sales organization
5. Centralized


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135 Sales Management - II Match the Column : Column A Column B 1. Audio-visual oriented training A. Compensation method of sales personnel 2. Straight salary B. Based on geography or territory 3. Credit recovery C. Demonstration of films, PPT, video etc. 4. Territory organization structure D. small group of skilled sale professionals 5. The Pod organization structure E. Objectives of sales organization
Answers:
1. C, 2. A, 3. E, 4. B, 5. D
True or False
1. Conference method gives opportunity for an all -round discus sion
veering around specific products or services that sales trainees will
sell in future.
2. Commission only a popular and widely practiced method or plan to
remunerate sales force.
3. Bonus is paid over and above the usual salary paid t o salesmen.
4. Decentralized Team Structures have sales team members posted at
various locations at strategic points.
5. Sales organization help in customer retention.
Answers:
1. True 2. False 3. True 4. True 5. True
6.5 REFERENCES Online Library:
1. https://ndl.ii tkgp.ac.in/
2. https://www.britishcouncil.in/library/online -library
3. http://infolibrarian.com/dlib.html
Reference Books
1. Richard R. Still, Edward W. Cundliff, Normal A. P Govoni, Sandeep
Puri (2017), Sales and Distribution Management: Decisions,
Strategies, and Cases, Pearson; Sixth edition. munotes.in

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136 2. Nag A., Sales and Distribution Management, McGraw Hill Education,
New Delhi
3. Havaldar Krishna K / Cavale Vasant M, Sales and Distribution
Management Text and Cases, 2nd ed., McGraw Hill Education, New
Delhi
4. Thomas DeCarleo, S ales Management, Wiley India, 10th Edition.
5. Aftab Alam, Sales and Distribution Management, Wisdom
Publication, 2006 Edition.
6. Patrick Forsyth, Sales and Management Training, A. Maya Gover
Publication, Edition 2001.
7. Aswathappa, K., Human Resource Management , Tata McGraw -Hill,
New Delhi.
8. Dessler, G. and Varkkey, B., Human Resource Management, Pearson
Education, Delhi.
Websites:
1. https://epgp.inflibnet.ac.in/
2. https://dictionary.cambridge.org/dictionary/english
3. https://www.collinsdictionary.com/dictionary/english
4. https://www.in vestopedia.com/terms/
5. https://www.yourarticlelibrary.com
6. https://www.economicsdiscussion.net
7. https://busines sjargons.com/
8. https://smallbusiness.chron.com/
*****
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137 7
SALES PLANNING AND
CONTROLLING - I
Unit Structure
7.0 Objective
7.1 Introduction
7.2 Sales planning
7.3 Sales Controlling
7.4 Summary
7.5 Exercise
7.6 References
7.0 OBJECTIVES  Know about sales planning and importance of sales forecasting
 Learn about different sales forecasting methods and its limitations
 Understand the concept of sales controlling
 Learn about Sales controlling tools: Sales Budget, Sales Audit, Sales
Quotas
7.1 INTRODUCTION The purpose of any business is profit maximization. T o maximize profit ,
organization is required to work in a systematic manner. In order to work
in systematic manner companies are having different departments which
are outcome of division of labour. In organization there are finance, HR
and Administration, Marketing, Manufacturing or operations and now a
days separate IT department are there. Production of goods and selling of
goods are major concerns in organizations and all other departments are
supporting departments. In order to survive in market competi tion
entrepreneurs, follow management process perspectives that is planning
organizing staffing leading and controlling. In organization there is
marketing department to market product and to maximize the sales. In
olden days there is only sales department which took care of selling goods
in the market but now scenario has changed now in order to survive in the
competitive environment firms need to undertake advertising, sales
promotion, customer relationship management, pricing and market
research etc. in addition to sales management.
Let us first try to understand the concept of Sales Management in brief.
The term Sales Management was defined as "Planning, Direction, and
control of personal selling, including recruiting, selecting, equipping,
assigning, routing, supervising, paying and motivating the sales force.”
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138 both within and outside the companies. Inside the organization, it builds
an informal organization structure which ensures e ffective communication
not only inside the sales department but also in its relations with other
organizational units. And outside the company, the Sales Management has
to service as the company's representatives with the customers and other
external organ izations. Apart from the responsibilities listed above, the
Sales Management is responsible for some other important functions too.
Some of these functions are important in making some key marketing
decisions such as budgeting, deciding the objective, sale s force size,
territories etc. While performing all these important tasks of sales effort
management and personal selling effort, the Sales Managers have to plan.
7.2 SALES PLANNING Sales plan is very vital for any organization and others plans of
organiz ations are depends upon the success of sales plan. It is the hub
around which the entire operations of the company work.
A sales plan is a business plan which states the development of the
company’s sales activity with set objectives within a particular ti me
frame.
In other words, it’s a strategic plan which specifies sales goals, tactics,
challenges, target market and steps you will take to execute the plan.
Success of sales plan will generate revenue for company that’s why it is
very important to prepar e it after proper market and product research. This
will decide the overall Survival and Success of the organization.
Following are the steps involved in preparation of sales -
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139 Sales Planning and Controlling - I 7.2.1 Sales Planning Process :
1. State Organization Mission :
It is first step in developing a sales plan. It is important to design sales
plan by keeping in mind organization’s mission. Organization mission is
purpose and objective of the organization and approach to reach the same.
Sales plan should consider the market position of or ganization, its
geographical reach, brand value of the organization before making sales
plan.
2. Frame Objectives and time duration :
Next step in the process of sales plan is framing of company’s objectives
and time duration. By keeping in mind company’s miss ion, it is important
to frame long term and short term objectives for sales. It is important to set
time duration to achieve that objective can be weekly, Monthly, quarterly,
yearly etc.
3. Forecast and strategies :
After framing objectives for sales plan, it is important to forecast or
estimate future results. After studying past records and authentic market
research sales manager will forecast the future results. On the basis of
forecast sales manager needs to make strategies to achieve required
results. This includes:
a. Selection of team :
Sales manager need to select team members who will achieve desired
sales plan. Selected team will work on sales plan. Selection should be
based on qualifications and experience of employees. For success of sales
plan, it is im portant to select good personnel and train them time to time.
b. Allotment of Resources :
When forecast and sales team is ready now its time to make allocation of
resources. Every company has its own assets and sources of finance
according to that sales plan s hould formulated. One has to see to it that
how many sales employees and expertise required, how much budget and
sources of fund available, what other tools like computers, marketing
tools, phones cars etc. will be require to execute sales plan.
c. Budget :
In allotment of resources step we are aware about resources required for
success of sales plan. Now in this stage final actual budget is prepared by
taking into consideration both income and expenses perspectives. Some of
the expenses that are the part of sa les plan budget includes salaries
commissions, Sales promotion costs, training, travel, printing costs, hiring
costs etc. against fund available and expected profit which ultimately
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140 4. Target Market and Competitor’s Study :
After selection of team members for achievement of sales plan it is
important to define target market on which sales team will work. Target
market includes Geographical area, target customers in terms of gender,
income, economic status etc. For example, if your company is dealing
with beauty products then your target market is women customers and if
your company is based in Maharashtra and currently operating in
Maharashtra your target market is Maharashtra. Likewise fixing target
market as per company’s reach and product features is very important step
in process of sales plan.
After evaluating company’s own resources and fund now it is important to
understand competition in the market. In this competitor’s study it is
important to study our own company’s competitive advan tages over
competitors as well as weakness over competitors. Competitive
advantages can be innovative product, free delivery, after sales service,
convenient locations etc. Study of market competition is very important
for success of sales plan.
5. Implementa tion of Strategy :
This is step which implies pricing and promotions. It is not final step. Here
company actually perform promotional activities can change as per market
situation. In this stage company also finalize the price of product and how
it will lau nch. After forecast and target market implementation is very
crucial stage in sales planning because even if we forecast & budget the
desired outcome but it can vary in actual market. Market is very dynamic
how customer will accept product is difficult to predict. Sales manager
will face challenges in this stage.
6. Check Result :
In this step of sales planning company examines sales results. It means
sales manager will compare actual outcome with targeted outcome.
Territory - wise sales will also measure for a ccuracy. Competitor’s sales
will also examine and gets recorded for future strategy.
7. Sales record examination :
In this step company will analyze sales record to know whether our sales
plan is succeed or not. In this examination company will analyze present
sales result of organization with past records as well as with competitors
sales results. This study will helpful to know what you did is right and
what went wrong. Here company will appreciate good results and provides
training to eliminate bad results.
8. Preparation of Action Plan :
This is final step in sales planning process in which company will prepare
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141 Sales Planning and Controlling - I sessions to existing sales personnel, Recruitment of experienced sales
team , outsource market research work to experience firm, increase the
analysis of market conditions and competitors strategies.
Here there is no single plan that can fit your company perfectly. There will
be hurdles along the way, and you can always mold the shape of your
sales plan until you start seeing favourable results. Take your time to
identify opportunities and ways to overcome challenges.
7.2.2 Sales Forecasting:
Wealth Maximization is main focus of every business. Money comes into
business through s ales for most of the companies. So sales forecast is
logically a starting point in planning process of any business. Sales
forecast is acts as a guiding path for sales manager and sales force. It is
very useful technique for the success of business. Accura te and timely
forecast can make difference it either result into profit or loss. Sales
forecast is generally timely either for short term ( less than year) or for
long term ( Over one year). By keeping in mind market uncertainty, it is
important to update sales forecast periodically.
Sales forecast is estimation of number of products to be sold in a given
period of time. A sales forecast is based on systematic research and study
of internal factors such as Product, price, services and quality etc and
extern al factors such as competitors, customers, weather conditions,
government laws and regulations etc. Sales forecast is not accurate it
changes as per market condition. Company needs to change sales plan
time to time for better result. Sales forecast is est imation for either for
quarterly, 6 monthly, yearly or for more than year.
The American Marketing Association has defined Sales forecast as “ an
estimate of sales, in dollars or physical units for specified future period
under a proposed sales plan or pro gramme and under an assumed set of
economic and other forces outside the unit for which the forecast is
made.”
7.2.3 Sales Forecasting Methods:
Various sales forecasting techniques are available to sales manager. It is
always better that sales manager shou ld use more than one technique for
sales forecast as no single technique is perfectly accurate. It is better to use
two or more techniques simultaneously for cross verification. Sales
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142

A) Qualitative methods for Sales forecasting :
1. Executive Opinion :
It is very old method of sales forecast. In this method group of
experienced executives from different departments are selected and asked
for opinion about company future sales. On the ba sis of market data and
their experience they forecast future sales of the organization. Selected
executives are responsible for forecasting sales. That’s why all internal
and external factors are take into consideration for sales forecast. In this
method s imply estimation and judgements of selected executive pooled
together and come up with sales forecast figure.
2. Poll of sales force :
In this method instead of experienced executive actual sales force is
involved in sales forecast. Here all salesman gives the ir estimates about
their territories for given period. Salesmen are close to the customers and
they know their territory completely that more accurate sales forecast can
be possible.
3. Collective forecast of individual product line :
This method is useful to company with multiple product lines. In this
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143 Sales Planning and Controlling - I An example of the Product -wise Sales Forecast for a company having 6
products c an be as follows:
Company XYZ
Product wise sales forecasting for financial year 2021 -22 Sr. No Product Unit wise Sales plan Value per unit (in Rs.) Total sales value ( in Rs) 1 A 10000 100 1,000,000 2 B 20000 50 1,000,000 3 C 15000 75 1,125,000 4 D 25000 60 1,500,000 5 E 30000 70 2,100,000 6 F 35000 80 2,800,000 Rs 9,525,000
In above product wise sales forecast, performance of products
A,B,C,D,E,F is estimated unit wise or in quantities and total sales value
for the year. Once this Product -wise Sales forecast is acceptable to the Top
Management, the same can be divided into regional, area -wise and
territory -wise sales planning.
4. Study of customer buying plans :
This is method of sales forecasting which is suitable for products with
limited customer s. This method is generally use for industrial goods or for
any costly luxurious goods which has limited buyers. Producer generally
sells goods directly to final customer. In this method face to face customer
survey is done and get the information. This is because customers buying
behavior and preferences changes frequently.
5. Product in use Analysis :
In this method Sales forecasting is based on performance of similar
product in the market or the product which is actually in use. For example,
if company wa nts to launch Air conditioner, then they will study the
performance of other Air conditioners in market and predict sales of their
AC. It is like competitors’ study for sales forecasting.
B. Quantitative methods of Sales forecasting :
1. Test Marketing :
It is popular method of measuring consumer acceptance of the new
product. The results from test market are used for prediction of future
sales. In first approach of this method the product is made available in
limited area can be in any retail outlet through small advertising campaign.
The performance of product is measured through customer research then
company go for national launch. Here simulative future market is done in
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144 Advertising and Sales Management
144 estimated. In anoth er perspective company selects two market on is test
market where product is marketed without any promotion efforts in
limited area. A similar market is selected which is termed as control
market where products are sold with promotional campaign in limited are.
Performance of product in both markets are measure and predict future
sales.
2. Time series method :
It is also called as historical data method. In this method it is assume that
past pattern of sales will continue in future. Past sales are generally used
as base for future sales predictions. Simple formula to find out sales
forecast on the basis of time series is
Next year sales = This year’s sales
------------------------ x This year’s sale
Last year’s sales
This method is simple and easy to apply the sales predictions are arrived
relatively fast as compare to other methods. But main disadvantage of this
method is only past data is taken as a base to predict future sales but no
other market factors are taken into consideration. Market is very uncertain
customer preferences, competitors’ strategy a new product development
can happen any time. So, sales forecast derived from this method can be
wrong if market condition changes.
3. Correlation method :
Correlation describes the relationship between variables. Changes in
external environment can be positively and negatively correlated with
firms’ sales. It will help in measuring future sales of the company.
Basically, this correlation method stud ies the impact of various market
factors on company’s sales.
4. Economic order quantity :
The economic order quantity is method of inventory control. This methods
tells about when and how much to order by taking into consideration
financial costs. Inventory carries cost. Finance department is forcing to
reduce quantity of products in inventory. Whereas sales department is
more interested in sufficient inventory in stock by keeping in mind any
unexpected demand. To resolve the conflict between these two
depar tments company uses EOQ method.
Formula for EOQ :
____________
EOQ = √ 2 ( R x S )
-----------------
P x 1
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145 Sales Planning and Controlling - I EOQ = Economic order Quantity
R = Requirement of the product in given period
S = Purchasing cost per order
P = price paid per unit
1 = Percent of Annual Inventory carrying charges
This provides the sales manager with an understanding of how much of
the product is in supply and how long it will take for delivery. This help in
prediction of sales and availability of inventory f or sale. This will avoid
out of stock situation.
5. Econometric Forecasting :
This method of sales forecasting is used by companies of consumer
durable products like TV, Washing Machine, fans etc.
Formula :
S = R + N
S = Total sa les
R = Replacement Demand
N = New Owner Demand
There are two main components of the total sales of the firm in this
method such as
1. Replacement or scrapped demand :
It refers to the demand that was created for another product due to
replacement of one item customer from the product line. This demand is
derived after counting number of scrapped units of the product.
2. New Owner demand :
It is the demand for goods that may be added with the existing stock of the
customers.
So this approach uses mathematical formula in the form of equation to
examine relationship between demand determining uncontrollable factors
and sales.
7.2.4 Limitations of Sales Forecasting :
Sales forecast is not always accurate because it gets influence by m any
internal and external factors in uncertain market. The main limitations of
sales forecasting are as follows:
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146 Advertising and Sales Management
146 1. Inadequate historical data :
Sales forecast is mainly depending upon the past records and study. If this
past records and market study is no t accurate then there is possibility of
wrong sales forecast. Inadequate and wrong data may result into incorrect
future sales forecast.
2. Multiple market forces :
Sales forecast is based on historical data and market research but
uncontrollable factors in market like government factors, legal factors,
environmental factors, social & psychological factors affect the sales of
the product. It is very difficult to predict these factors so accurate sales
forecast is difficult to achieve.
3. Unpredictable consum er behaviour :
Even if sales forecast is conducted by experts and it is done after extensive
market research and study but ultimate sale of the company is depending
upon customers. If customers preferences have change or they have shift
to competitor’s prod uct then sales forecast may fail.
4. Availability of substitutes :
Sales is influenced by the availability of substitutes. If plenty of substitutes
are available then it becomes difficult to predict sales.
5. Higher cost :
Market research and statistical techniques are not used by small firms as it
involves huge cost. Because of this sales forecast fails.
6. Influences of psychological factors :
Many psychological factors like customers buying motives, perception,
attitude, values and lifestyle has direct i mpact on his buying decision. And
it is very difficult to predict psychological factors because they are
different for every individual. So sales forecast is not accurate.
7. Based on assumptions :
Sales forecast is based on assumptions which are not always correct that’s
why sales forecast is very difficult conduct which is not always accurate.
8. Technical Development :
Rapid technical advancement affects production , quality of product,
customer preferences, market demand and competition so it is difficul t to
make accurate sales forecast.
9. Dynamic business environment :
Business environment is dynamic and flexible. It changes every minute so
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147 Sales Planning and Controlling - I 10. Mathematical complexity :
Many statistical techniques for f orecasting are complex and difficult to
understand. Lack of training and understanding errors can incurred. So, it
is difficult to predict sales.
No single method of sales forecast is perfect. A combination of 2 or 3
methods will give most likely accurate sales forecast.
7.3 SALES CONTROLLING Sales control is an integral part of the sales management. Whatever
company has planned in sales planning process sales control will have an
eye on sales activities so that things should be happened in reality as per
plan.
Sales controlling is necessary for follow up for planning. Sales controlling
is the main responsibility of the sales manager. This controlling will
analysis how why and when things went wrong on time to time and
suggest necessary steps to correct mis takes. Sales controlling is very
important function of sales management which enable sales targets and
profit maximisation by coordinating different Sales functions.
Objectives of sales Control :
If organization designs sales control tools perfectly then it will increase
the possibility of sales target accomplishment and profit maximization
smoothly. The objective of sales control is keep track of company’s sales
efforts compare it with target and then take necessary action. It makes
sales planning more mean ingful.
Objectives of sales control :
1. Examination of sales performance :
Main objective of sales control is measurement of sales performance by
sales force in given territories. All assessment should lead to necessary
feedback. If achievement is beyond ta rget, then reward, is must. But
performance is below the standard set then necessary training is required
for improvement.
2. Control Negative performance :
Another objective of sales control is to identify negative factors of sales
performance. Proper feed back system should be developed for smooth and
timely reports. Tight control is very important for fair performance by
sales person. Continuous feedback from salesman territory wise, product
wise region wise is important for corrective actions.
3. Identif y future opportunities :
Identification of new opportunities for profit maximisation in future is also
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148 Advertising and Sales Management
148 controlling sales person can identify new product introduction opportunity
or int roduction of varieties in the same product opportunity before
competitors. After verification company should consider this opportunity
for sales and profit maximization
Sales controlling process

It is simple proc ess of sales controlling. First company set target that is
sales plan then in second step comparison between what is planned and
what is actually achieved and lastly corrective action taken. If Actual is
more than target then company will provide rewards t o sales personnel if
Actuals are less than target then there is need of training and change of
strategy. There are various sales controlling tools available like Sales
Budget, Sales Audit, Sales Quotas and Sales Territory etc.
7.3.1 Concept of Sales Budget :
The sales budget, a type of operating budget, is a forecast of the expected
units a company intends to sell over a period of time and the revenue it
should generate from it. It is the basis for preparing the income statement
for the business. The managem ent prepares a sales budget based on its
business environment, overall economic condition, the intensity of
competition in the market, production capacity, available funds, etc . It is
instrument which sales manager uses to project the profit by forecasting
the revenues and expenses of the firm. Sales budget is income and
expenses statement where income side will talk about estimated profits
and gains and expenses side will talk about money involved in distribution
of goods, promotional efforts and manpower for selling for period of time.
A sales budget acts as a yardstick for evaluating the company’s
performance. It serves as a reminder to meet the plans and targets. Also, if
the company’s actual performance is not on par with the budgeted figures,
the compa ny can take corrective action in time. The sales budget is the
base on which other budgets are prepared in an organization. Hence, it
should be prepared with the utmost care and precision. For example, the
sales budget will help prepare the production budg et as production will
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149 Sales Planning and Controlling - I purchase budget or budget for the HR department will be directly
dependent on the quantity the company intends to sell. In case the sales
budget forecasts fail to me et expectations, it can be disastrous for the
company. This will be so when it has made purchases accordingly or hired
extra manpower to meet the sales figures. In the opposite case, with low
budgetary forecasts, the company will face a shortage of materia ls and
manpower, which will lead to a loss of sales opportunities.
Steps involved in preparation of Sales Budget :
1. Market conditions Analysis :
First step in making sales budget is analysis of market trends, economic
conditions, seasonal fluctuation in de mand, competitors’ strategy, new
products in market and customer preferences etc. In this analysis company
should analyses both current market scenario as well as past experiences.
2. Identification of problems and opportunities :
After study of market cond itions in past as well as in present sales
manager will able to identify problems in the market which is result of
actual sales is less than targeted sales. On the other side sales manager will
find opportunities where either targeted sales = actual sales or actual sales
are more than targeted sales. The sales management must provide
necessary aid to meet such problems and challenges.
3. Development of sales forecast :
After identifying problems and challenges the next step is to forecast sales
for next bud geted period by avoiding previous year mistakes and
weakness experienced in market. Combination of two or three sales
forecasting techniques is important to use for more accuracy. Sales
forecast is very important for sales budgeting because it determines n ot
only the sales revenue but also money involve in promotional and
manpower efforts.
4. Formation of sales objectives :
Once sales forecast is ready sales force is required to get target or
objectives as per their territories and expertise. On the basis of market
study and sales forecast sales objectives are formed.
5. Execution of sales tasks :
It is step in preparation of sales budget where objectives should be
translated into activities. Sales management should carry various activities
right from recruitm ent of experienced sales force to the evaluation of
delivery and after sales service. Cost involved in all above activities are
derived and then compare it with desired profit.
6. Resource Requirement :
Here sales manager will find out cost required to car ry out various
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150 7. Finalization of estimation :
Here sales objectives, tasks and resources are carefully reviewed. All
expense side is examined properly and check on projected profits.
Finalization of budget is done.
8. Presentation and Approval of budget :
As soon as budget of sales department is ready. It is presented to top
management for approval.
9. Revision of Budget :
Top management will check sales budget, market conditions and reso urces
available to achieve the same. Necessary changes suggested by top
management to be made for approval.
10. Approval of Sales Budget :
It is final step of sales budget preparation. Top management approves
budget and it ready for implementation.
7.3.2 Sa les Audit :
A sales audit is evaluat ion of your sales process and identify corrective
actions to achieve your desired objectives to help your business hit its
revenue goals. It is systematic comprehensive study of entire sales
operation functions. It stud ies all sales activities right from order received
to customer feedback. It scrutinizes all selling activities, company sales
policies, objectives, procedures and check whether they are fully work or
not.
Company invests huge amount of money on its sales function. Because it
generates Profit. Sales audit is important to carry so that company will
able to examine profit against investment. More specifically sales audit is
a systematic, critical and unbiased review and appraisal of sales objectives
and poli cies of selling function and of the organization, methods,
procedure and personnel employed to implement those policies and
achieve organizational objectives.
Sales Audit comprises of :
1. Preparation of sales order:
It is prepared in three copies one is as invoice to finance department, one
is as a delivery note to customer and one copy to store department for the
goods taken from store for sale. All three copies should match with each
other in terms of quantity and value.
2. Outward Register Entry:
When go ods are dispatched from stores for sales it should entered in goods
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151 Sales Planning and Controlling - I 1. Every day order receipt books to be checked against order delivery or
outward book
2. Prices entered into invoices should match with sales order.
Likewise systematic sales audit is to uncover opportunities for
improvement of sales function of the organization. Sales Audit is
continuous process. It is standard procedure of entries in records. It is duty
of sales audit to assure the fair sales accounts. Sales department data
should match with finance department. Sales Audit is also helpful to
prevention and detection fraud. For successful Sales Audit following
points should take into consideration:
1. Sales ledger balances should be in control and update frequently. It
should tak e care of credit notes, unpaid invoices, bad debts etc.
2. Terms of credit should be strictly monitored.
3. All miscellaneous adjustments in accounts like bad debts, allowances,
returns, credit sales should be approved by responsible official.
4. Monthly statemen t should be made of all accounts regularly.
5. Discounts should be considered properly.
6. Inventories should be maintained properly. It should take into
consideration returns, resale etc. with sales.
7. Inventory control should be there under centralized author ity.
8. No good should go out and come in without written record.
All above efforts are very important for sales controlling.
7.3.3 Sales Quotas :
Sales quota is an effective and popular technique of sales controlling and
helps in directing sales activities. Quota means a quantitative objective
given to specific sales department or to a salesman. It is breakdown of
total sales target into small unit wise or salesman targets.
Sales quotas are the sum of the total sales of a future period and duties to
achieve the component of total sales by each salesperson are handed down
to them at the beginning of the period.
According to Philip Kotler, ‘A sales quota is the sales goal set for a
product line, company division, or sales representative. It is primarily a
mana gerial device for defining and stimulating sales effort s. So basically,
it is a quantitative goal assigned to a specific marketing unit such as a
salesperson or a territory for a time period. So, sales quota is a
standardized method of evaluating the effec tiveness and performance of
salespeople .
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152 Advertising and Sales Management
152 Some other definitions :
In the words of Paul H. Nystrom, “A sales quota is that part of share of a
company’s total estimate sales assigned to a salesman, a territory, a branch
house, a distributor, a dealer or to s ome other selling unit, as a goal to be
attained in a designated future period of time.”
In the words of Cundiff and Stiff, “Sales quota is a quantitative goal
assigned to a specific marketing unit, such as to a salesman or territory.”
In the words of Stan ton and Buskirk, “A sales quota is a sales performance
goal. It is assigned to a marketing unit, a sales person, branch, middlemen
or customer.”
Objectives of Sales Quota :
1. To provide quantitative sales targets :
The main purpose of setting sales quota is to provide quantitative sales
targets to each salesman, territory and branch. It is in terms of units as well
as in term od rupees. It is very easy method of performance appraisal of
sales persons.
2. To motivate salesmen :
Quantitative targets will motiva te salesmen to achieve target so that they
will earn good incentives. Company frame sales target for each salesman
very carefully which can be achievable otherwise target can demotivate
individual.
3. Budgetary control :
Quantitative targets will also help the organization to have control over
selling cost. Salesmen performance can also measure in terms of reduction
of selling cost. Less selling cost by any salesmen, it will get appreciated.
4. Use in connection with sales contest :
Sales quota is important to evaluate the results of sales contests. Certain
minimum sales quota is fixed for each salesman to be achieved, to ensure
his participation in sales contests.
5. Estimation of future needs :
Sales quota is useful because it helps in estimating the future needs of
every salesman, territory, branch or middlemen and also to estimate future
requirements of sales -force, office employees and other requirements if
any, in advance .
7.3.4 Methods of Sales quotas :
Companies set different types of sales quotas. The m ethod of selecting the
quota largely depends on the business practice, the design of the
organization, and the level of competition in that industry. Broadly, quota munotes.in

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153 Sales Planning and Controlling - I types include sales volume quota, sales budget quota, sales activity quota,
and a combinati on quota.
1. Sales volume quota :
Most of the companies follow this method of quota setting. It is the most
traditional and commonly used method in Indian organizations because
this method provides an important standard for appraising the performance
of ind ividual salespeople, intermediaries, and branch. Example of Sales
volume quota
Performance Index = Actual sales /Sales Quota x 100
The annual quota is set for the year and then they are broken into specific
time periods such as quarters, months, and weeks. This is called the
breakdown approach. Once the salesperson knows his annual target, he
can plan out his targets for different per iods.
1. Sales Budget quota:
These kinds of quotas are set for various units by the organization in order
to control expenses, gross margins, and net profits. The overall intention
of setting a budget quota is to make it clear to the salespeople that they are
more of a responsibility Centre where the job includes not only obtaining
the desired sales volume but also making good profit by controlling selling
expenses. Sales person A B C D E Sales Cost of sales Gross Profit margin Expenses Salary Promotional expenses Travelling Expenses Other Expenses Net Profit Margin Sales
quota Actual
Sales Rupees
difference Unit wise
Difference Performance
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154 Salesperson receives an expense budget as a percentage of the territory
sales volume and manages the expenses in rupee terms. Many compa nies
set upper limits on items of expenses such as lodging, meals, and
entertainment, and expect the salespeople to manage within that budget.
Profit quota can be set on gross margin or on net profits. Organizations
emphasize net profits more than sales vo lume. The salesperson is asked to
generate profitable sales rather than mere sales. Organizations set profit
quota along with the sales volume quota because profits are necessary for
surviving and excelling in business. The rationale behind this type of
quota is that sales personnel operate more efficiency to reduce expenses
and increase the sales resulting in increased margins and profits.
The salesperson is bound to achieve either the required gross margin or net
profits while achieving sales quota. Gross margin quota is determined by
subtracting the cost of goods sold from sales volume . Net profit margin
will achieve after we subtract expenses incurred on sales from gross profit
margin.
3. Sales Activity quota :
This type of quota is used to undertake time and motion studies and
conduct work -studies for deciding on the optimum combination of
activities for a salesperson. Activities quota set objectives for job - related
duties, which help the salespeople in achieving their performance targets.
Example of Sal es Activity quota Number of calls Number of order Order / call Ratio Actual Sales Average Sales Person order Total final customer Sales Person A B C
Here full concentration is on sales person activity like how many calls he
has made then how many calls actually converted into order and finally in
actual sales. Activity quota is not a basis for reward but an effective
understanding of these activities helps the salesperson to understand why
he could not achieve the sales quota set for him on the specified territory .
4. Combination quota:
Many organizations use a combination of these quotas. The most common
combination is the sales volume and activity quota. Combination quota is
used to control sales force performance on the bas is of selling and non -
selling activities .
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155 Sales Planning and Controlling - I 7.3.5 Limitation of Sales quota :
1. Individual differences :
Ability of individuals may differ. While setting the sales quotas,
differences in qualities, abilities, experience and positions among the
salesmen are not considered suitable and, therefore, the sales quotas
cannot be real.
2. Economic burden:
It needs to take the services of experts, market research and statistical
techniques to set the sales quotas. All these requirements bring the
expenses much higher . Many organizations are not in a position to meet
higher expenses.
3. Complex techniques:
Certain institutions use complex techniques to set the sales quotas, and it
will not be easier to understand the techniques as they are much complex
and costly.
4. Emphasis on sales only:
Certain managers are of the view that sales quotas are only helpful to
increase the sales and earn more profits, but this cannot be the only aim of
business. They are of the view that selling of sales quotas is not so
important to ac hieve more sales. Advertisement, publicity, sales
promotion, etc. are much helpful in getting more sales and earning more
profits.
5. No importance in sellers’ market:
Where the demands are larger than supplies (sellers’ market), there will be
no difficult y in selling the product. The producers of such products do not
give importance to set sales quotas.
6. Effects of various factors on sale:
It is not correct to say that increase in profits is due to the result of selling
efforts, but various other factors such as price, quality, cost of production,
demand and supply conditions, competition etc. also influence the
quantum of profits.
7. Personal bias:
It is very difficult to set an accurate, unbiased and justified quota. It cannot
be kept away from personal bias of managers.
8. Based on estimates:
Sales quotas are set on the basis of sales forecasts and therefore, the quotas
will also remain as estimates.
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156 Advertising and Sales Management
156 9. Indifference towards other functions:
Many times, sales quotas prove impractical as the salesmen do not give
attention to non -selling activities, such as searching of new customers,
removing the objections of customers, collection of dues from customers,
etc.
7.4 SUMMARY Sales is very crucial function of Management as revenue of company is
depends on i t. Sales planning plays very important role. It is business plan
deals with sales objectives or targets to be achieved. Sales forecasting is
important in making sales plan. Sales forecasting is estimation of desired
sales after market research and past dat a study. It is better to use more than
one sales forecasting method simultaneously for better forecast. Sales
forecast is not 100% correct but it acts as a guiding path for sales manager.
Making planning is not enough it is important to execute and evaluat e
sales plan that is called as sales controlling. In sales controlling manager
compares target with actual. Result will either success or failure. Success
is always get appreciation but failure needs further training and
improvements. For effective sales c ontrolling company prepares sales
budget which is not only focus on sales target but also selling expenses
incurred on sales. It is important as this leads to cost control over sales.
Another sales controlling tool is sales Audit it talks about proper
docu mentation about sales right from order received till receiving
customer feedback. This helps company to achieve its sales objectives.
Sales Quota is another sales controlling technique in which quantitative
targets are given to salesman and his performance is measure accordingly.
This helps sales manager to control salesman and selling cost. All efforts
are made by the company to achieve sales targets and generate revenue.
Success of sales will determine the survival of company in the market.
7.5 EXERCISE Q.1 Fill in the Blanks :
1. ______________ is the old method of sales forecasting.
a) Correlation b) Executive Opinion
c) Time Series d) EOQ
2. _____________ is one of the sales controlling tools.
a) Ledger b) Sales Budget
c) Balance Sheet d) Income statement
3. Sales quota can be derived by using ____________ method.
a) Sales promotion b) Sales volume quota
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157 Sales Planning and Controlling - I 4. ______________ is a business plan which states the development of
the company’s sales activity wit h set objectives within a particular
time frame.
a) Production plan b) HR Plan
c) Sales Plan d) Financial Plan
5. ______________is a type of operating budget, is a forecast of the
expected units a company intends to sell over a period of time and the
revenue it should generate from it.
a) Sales Audit b) Sales Plan
c) Sales Budget d) Sales Quotas
Q.2 Match The following : A B Sales Controlling Estimation of sales Sales Audit Evaluation of sales objectives Sales Forecasting Measurement of sales perf ormance Sales Quotas Setting Objectives Sales Planning Sales Activity quota
Q.3 State true or false :
1) A sales audit is evaluat ion of your sales process and identify
corrective actions to achieve your desired objectives to help your
business hit its revenue goals
2) Measurement of sales performance is an objective of sales controlling.
3) Identification of geographical area is the first step in sales planning
process.
4) Sales budget is a forecasting of expected sales of a product for certain
period of time.
5) Sales quotas can be act as a demotivator to sales person
Q.4 Write Short Notes :
1) Sales Controlling
2) Sales Budget
3) Sales Audit
4) Types of sales quotas
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158 Advertising and Sales Management
158 Q.5 Answer the following :
1) What is s ales control? Explain its objectives and also various steps in
sales control process.
2) Outline and discuss the steps in the sales budgeting process.
3) What is sales plan? Explain the main steps followed in sales planning
process.
4) What do you mean by sales forecasting? Explain methods of sales
forecasting.
5) Define sales quotas and explain the objectives and limitations of sales
quotas.
7.6 REFERENCES  Advertising and sales Management - S Praveen
 Marketing Management – Philip Kotler
*****

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159 8
SALES PLANNING AND
CONTROLLING - II
Unit Structure
8.0 Objective
8.1 Introduction
8.2 Sales Territory
8.3 Recent trends
8.4 Summary
8.5 Exercise
8.6 References
8.0 OBJECTIVES  Understand the concept of sales territory and reasons for sales
territory
 Learn factors determining sales territory and steps in designing sales
territory
 Learn about importance of customer feedback, Concept of data
mining with sales management and impact of IT on sales management
8.1 INTRODUCTION When making sales to a wi de audience, staying organized and having a
system to manage customers is key. Distributing sales responsibilities into
territories is a popular method for coordinating sales activities. If you
manage a sales team, knowing how to divide sales territories s upports your
ability to serve customers and optimize your sales strategy. Other than
sales efforts there are many things that makes your sales more successful
and achievable that is customer feedback, data mining and information
technology etc.
8.2 SALES TERRITORY Sales territory is a designated geographical area or a group of customers
which are assigned to a sales team or individuals in order to achieve
allocated sales objectives and targets. This is where the sales teams would
be spending their sales e fforts. This sales territory is responsibility and
accountability of that particular sales team. The sales team ensures that the
sales in that area increase and meets sales targets every year.
Any company creates a territory based on geographic area, popul ation
demographics, sales potential etc. This territory is assigned to sales
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160 Why sales Territories? :
Sales Territories are established for achievement of organization goals. It
is helpful for sales team for their perfo rmance because they know about
who will look after which territory.
8.2.1 Reasons for Sales Territories or objectives of sales territory :
1. Systematic Market Coverage :
If company’s target market is state of Maharashtra and if company will go
for territory -wise sales plan then they will divide their sales team district
wise and then city wise so that each will concentrate on given locations
and company will able to cover maximum potential market. Sales team
will able to customer follow up as desired.
2. Effective recruitment of sales team:
Company will choose local personnel for respective territory then sales
person will able to reach many customers as it is in his comfort zone.
Company’s customer reach will maximum when we appoint local sales
personnel.
3. Customer service :
Local sales person knows the problem, choices and preferences of
customers from given territory. Well -designed territories will result into
seller and buyer relation ship which will result into customer satisfaction.
4. Growth in sales:
Sales territory will enable sales person to concentrate on given territory
this will help him to increase selling efforts for growth in sales.
5. Reduce selling expenses :
Sales territory is assigned to sales person who is generally appointed by
the compa ny from same territory result of this travelling expenses are
reduced. This will reduce total selling expenses of the company.
6. Interest and morale of the sales force :
When sales force works in the given territory they have reasonable and
achievable targ ets that why they are enthusiastic and motivated to achieve
sales target.
7. Controlling sales activities of sales force :
It is very easy to control sales activities of salesmen when sales territories
are set. Sales person knows his territory very well. He is aware about
problems and opportunities in sales territory. So sales person has better
control on sales in his territory. At the same time company has better
control over sales force and able to promote a better evaluation of sales
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161 Sales Planning and Controlling - II 8.2.2 Factors determining Sales Territory :
1. Geographic Location :
Very important factor in deciding sales territory is geographic location.
Geographical location can be Countries, states, cities, Districts and several
territories in big citie s. If sales territory is small in size the sales person
can personally visit customers and if it is big in size then sales person
needs to call customers and have a track of it.
2. Sales potential :
Sales potential is another factor in determining territori es. The number of
potential customers within a particular area can determine the size of the
territory.
3. Workload :
The number of customers and average size of sales will also important
determinant of sales territory. The amount of time necessary to spend with
the customer and number of customers are factors considered when
determining the workload of the sales force.
8.2.3 Designing Sales territory:
In many organization territories are designed on the basis of personal
skills and market conditions. These sales territory changes as per
requirements. Dynamic market conditions forced companies to study and
adjust their territories. Generally designing of sales territory is depends
upon potential market and on workload assigned to each salesman.
There are main four steps in designing sales territory:
1. Selection of geographical location :
First step in designing sales territory is selection of geographical area.
Company required to fix its target market first. If it is India whole country
then divide territory in States, Districts, cities, villages and in each city ad
village divide into nearby destinations. These division of location is also
called as control units. Territory designing should be done after proper
study of market research and staff availability.
2. Determining sales potential in control unit :
Here it is important to check potential of sales or possibility of sales in
designed control units. Sales territory planner should identify the buyers of
the product. After determining potential buyer the pl anner should check
sales possibility or sales success in each control unit. Territory planner
ascertains these control units with sufficient sales potentials to justify sales
coverage.

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162 Advertising and Sales Management
162 3. Combining control units into tentative territories :
After measurin g sales potential in each control unit and categorized which
are to receive sales coverage the planner combines units into tentative
sales territories. Here planner has to determine tentative sales territories
without making any adjustment in coverage assu ming that there are no
special features of each tentative territory.
4. Adjustment in tentative territories and finalize sales territory :
Sales planner makes necessary changes into tentative sales territory as per
characteristics of each tentative sales territory and salesmen expertise.
After this company will finalize sales territory.
8.3 RECENT TRENDS Other than market research and salesmen expertise there are other factors
which are also important for success of sales that are receiving timely
customer feedback, data mining techniques and use of Information
technology in sales management etc.
8.3.1 Customer Feedback :
Customer feedback is marketing term which describes obtaining
customer’s opinion about a business, product or service. Customer
feedback is very important which tells us customer’s test, likes, dislikes,
preferences about the product. It is more significant when company
introduces new product in market. Through focus group method, in person
method or customer phone survey method will give c ustomer’s opinion
about the product or service to company. When company knows what
customer exactly want then they make changes in product. Without
customer feedback it is difficult to understand customer’s needs and
preferences about product and services.
Importance of Customer Feedback :
Customer feedback is very important because it provides marketers
reactions of the customer about their products or services and overall
customer experience. We shall discuss the importance of customer
feedback as follows :
1. Improve Product or service :
Customer feedback is opinion of customer about product or service. From
that opinion company can derived exact customer want and preferences.
And then company can make necessary changes as per customer desires.
2. Measure c ustomer satisfaction :
Customer feedback gives us information about the customer satisfaction.
Customer opinion shows us their satisfaction level. So customer feedback
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163 Sales Planning and Controlling - II 3. Customer Retention :
Customer feedback is u seful to find loopholes in the product and service.
When company come to know about it they make necessary changes and
in the product and service. This will help company to retain customers.
4. Helps in decision making :
Customer feedback is very useful for company’s top management to take
decision about products as per customer preferences. This also give
information about company’s sales front or salesmen to company.
8.3.2 Methods of gathering customer feedback :
1. Email survey:
It is common method of co llecting feedback from customers. It is cost
effective method of customer feedback as here we can send feedback
questionnaire link to many customers simultaneously.
2. Short message Service ( SMS) :
Similar to Email Survey SMS is also a better option for com panies to
collect customer feedback. It is little bit costly than email but very
effective tool for collecting customer feedback. Here customer feedback
form is sent to customers on their mobile number in the form of SMS.
3. Social Media :
Due to popularity of social media in all ages it is powerful tool for
collecting customer feedback. Feedback can come in the form of likes and
dislikes and sometimes in the form of comment.
4. Call centre :
By direct call to customers from call centre of the company and rec ord it.
It is another tool for collecting customer feedback.
5. Contact forms :
Contact forms are excellent way of collecting customer feedback. In this
method feedback form is filled by customer and then sales manager
reviews it. Sometimes company keep fee dback register in the office for
customer feedback record. Suggestion box is also available sometimes to
collect customer feedback.
8.3.3 Data Mining :
Data mining is one of the most effective ways organizations can make
sense of their data. This technique can be extremely valuable to streamline
operations, build accurate sales forecasts, increase marketing ROI, provide
valuable customer insights, and much more.
Data mining is the process of analyzing big amounts of data to find trends
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164 Advertising and Sales Management
164 comprehensible insights about various areas of the business. These areas
may include sales, marketing, operations, finance, and more.
Data mining can give you important insights that solve problems, reduce
risks a nd costs, identify market opportunities, improve customer
experience, and predict customer behaviours and preferences.
Data mining is defined as a process of discovering hidden valuable
knowledge by analysing large amount of data which is stored in databas es
or data warehouse using various data mining techniques. Such as machine
learning, Artificial intelligence and other statistical tools.
Data mining is interactive process that involves following steps:
1. Problem Identification :
Data mining project is st art with the problem understanding. Data mining
experts, business experts work together to design project objectives and
requirement of the business.
2. Data Exploration :
Data mining experts identify useful data from pool of data. They
understand the meani ngful data. They collect, describe and explore data.
3. Data Preparation :
Data mining experts build data model for modelling process. They collect,
cleanse and format data because mining function accept data only in
certain format. It is stage where data i s squeezed many times. Preparing
data for modelling tool by selecting records, tables, attributes etc.
4. Modelling :
Data mining experts select and apply various mining functions because
one can use different mining functions for the same type of data mini ng
problem.
5. Evaluation:
Data mining experts evaluate the model. If the model does not satisfy their
expectations, they go back to modelling phase rebuild the model by
changing required parameters. When they are finally satisfied, they go for
deployment.
6. Deployment :
Data mining experts use mining results by exporting the result into data
base tables or in spread sheets. It helps the one to select the input data,
explore the data transform the data and mine the data.

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165 Sales Planning and Controlling - II Data mining Techniques :
1. Associa tion:
Association is one well known technique in which relation or pattern is
discovered based on a relationship between items in the same transaction.
The Association technique is used in market basket analysis to identify a
set of products that customers frequently purchased together.
2. Classification :
Classification is used to classify each item in a set of da ta into one of a
predefined set , classes and group. In classification data mining experts
develop the software that can learn how to classify the data items into
groups. For example If we access to all employee data we want to see
employees recently left organization and employees who are going to
leave organization. Then data will automatically gets segregated and
classify from total employee data.
3. Clustering :
It is data mining technique that makes meaningful clusters of objects
which have similar characteristics. For example, if in one library there are
wide range of books on various topic available. The challenge is how to
keep those books so t hat reader will easily access many books of required
topic. By using clustering technique, we can keep similar books in one
shelf and cluster for easy access. If reader want book on certain topic then
he will directly go and access desired shelf.
Data mini ng and Sales Management :
Data mining has importance regarding finding the patterns forecasting
discovery of knowledge etc. in different business domain. Data Min ing
techniques like Association , classification and clustering etc helps in
finding the pattern s to decide upon the future trends in businesses to gro w.
Data Mining is used in CRM ( Customer relationship management). Data
mining in CRM applications can contribute significantly to the bottom
line. Data clustering can be used for automatically discover ing the
segments or groups within a customer data. We can also identify group of
customers who are not profitable through data mining. This data mining
technique is very beneficial to the company because they are maximising
profit by focusing the selling e fforts on specific group of customers
without wasting time and resources. Businesses used data mining
techniques to examine return on investment. Company can solve many
business problems by data mining technology.
1. Provided the marketing team with the abili ty to predict the
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166 Advertising and Sales Management
166 4. Reduces telecommunication fraud
5. Saved money by detecting fraud
6. Reduced the frauds caused by middlemen and agents
Many retail shops, hospitals banks and insurance companies are using data
mining techniques. Retail companies use data mining to identify customer
behaviour buying patterns. Data mining can also be useful for human
resource department in finding the characterises of their most successful
employ ee.
8.3.4 Role of IT :
The role of IT in sales management is very simple; it’s designed to make
the life of you and your field sales team easier while increasing
productivity and performance. Every piece of software from mobile CRM
to ERP, email to Smartph one is built to serve that purpose. Information
technology has become significant and integral part of business plan.
From any Multinational corporation who maintain mainframe workplace
system and database to small business with single computer IT plays
important role.
Many business adopting new technologies to in crease their reach to
customers , profitability and competitive advantages to revamp the sales
process. E -commerce is booming sector now a days. Right from order till
delivery to customer all things ae managed with help of information
technology. The following are some technical tools organizations are
using in their selling process.
1. Big Data :
Using big data tools sales organization can now manage prospecting a
critical step in sales management th at is finding potential customers with
specific needs and wants. Earlier it was labour intensive process to
identify prospective customers With the help of customer data models it is
very easy to identify potential customers.
2. Social platform:
The explos ion of social technology has given rise to many social media
platforms for attracting new customers. Social media platforms provide
opportunities to companies to shake hands with customers and engaged
them in conversation about products and services. Unlik e conventional
sales social media platform makes it possible to shake hands with millions
of customers across the world at a time. Quick customer feedback on
social media platforms provides many improvement points to company for
better product and services .
3. Sales force Automation:
Sales force Automation technology solutions automates many selling tasks
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167 Sales Planning and Controlling - II and revenue. Armed with huge customer data and quick customer
feedback sales man ager can take action and make adjustments quickly to
optimise efforts.
4. Cloud based CRM:
Customer management systems are powerful tools designed to give
organization a complete view of customer relationship by integrating
marketing, sales and customer su pport. Traditional CRM system sales
staff can use in office environment but this cloud -based CRM system
enables sales person to access data from anywhere any time.
5. Mobile Technology :
Mobile devices like smart phone tablets have changed the aspects of
selling process. Generally, everybody now a days have smartphone so for
customers it is easy to research about product and service and then start
buying process from phone itself. It provides customer feedback system as
well as customer complaint system.
So Information technology the internet, electronic commerce (e -
commerce) wireless and mobile technology have each had a major impact
on salesforce productivity and management. Technology is really
transforming the world of sales. Going forward only organiza tions that use
powerful tools and technology such as big data, cloud -based CRM, mobile
technology, social media etc in sales processes will remain profitable and
competitive.
Through Data based reporting system sales management can view
progress of sales t eam anywhere in the world. Management can make
sales of new products and services. Customer can access the web from
their offices, homes or remote internet locations at their convenience. It
maximises comforts to the customers that ultimately results in sa les and
then Profit.
8.4 SUMMARY This unit will talk about designing sales territory. Sales territory is
geographical area assigned to each salesman as per his expertise. Sales
territory is giving comfortable platform to salesman to achieve targets.
Only s elling efforts by salesman and market research is not enough for
success of sales. In sales management recent trends like receiving
customer feedback, data mining and use of IT (Information technology)
increases chances of success of sales plan. Customer f eedback is
customers opinion about company’s product. It is important to understand
loopholes and make action plan for improvement. Data mining technique
is pool of data. It helps salesman to find exact customer data he required
for sales like territory - wise, gender wise, income wise customer data as
and when required. Information technology is always beneficial to reduce
workload on salesman and make them concentrate on selling activities.
Social platforms, sales force automation, Cloud CRM are effective
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168 Advertising and Sales Management
168 8.5 EXERCISE Q.1 Match the following :
1) _______________is a designated geographical area selected for sales.
a) Sales Budget b) Sales Audit
c) Sales Territory d) Sales Quota
2) _______________ is first step in desig ning sales territory.
a) Selection of Salesman b) Availability of Fund
c) dentification of Geographical Area d) Market Research
3) _______________ technology solutions automate many selling tasks
and freeing up sales employees to focus on activities that generate
sales and revenue.
a) Mobile technology b) Social media platform
c) Internet d) Sales force Automation
4) __________ is data mining technique used in sales management.
a) Social Media b) Association
c) Sales Audit d) Sales Forecasting
5) _______________ is very common method of getting customer
feedback.
a) Social Media b) Contact Forms
c) Call centre d) Email survey
Q.2 Match the following : A B IT in Sales Management Improve Market Coverage Cloud based CRM Customer Feedback Email Survey sales person to access data from anywhere any time Sales Territory Large Amount of Data Data Mining Sales force Automation
Q.3 State true or false :
1) Data mining is process of discovering hidden valuable knowledge by
analysing large amounts of data.
2) Email Survey is more cost effective than SMS method for gathering
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169 Sales Planning and Controlling - II 3) Sales territory is making job of sales person more complicated.
4) CRM (Customer Relationship Management) is a Data Mining
Technique
5) Sales territory is making sales job more costly and time consuming.
Q.4 Write Short notes :
1) Application of Data Mining in sales management
2) Importance of Customer Feedback
3) Role of IT in sales Management
4) Steps involved in designing sales Territory
5) Techniq ues of data mining
Q.5 Answer the following :
1) What is the importance of customer feedback for a company? Explain
methods of collecting customer feedback.
2) What do you understand by sales territories? Explain the main reason
for establishing sales ter ritories.
3) How information technology is important for reducing sales efforts?
Explain different technical tools used by the organization in selling
process.
4) Explain the concept of data mining and steps involved in data mining
process.
5) What is data Mining? Explain process of Data Mining.
8.6 REFERENCES  Advertising and sales Management - S Praveen
 Marketing Management - Philip Kotler

*****
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8/20/22, 4:58 PMTurnitin Originality Report
https://www.turnitin.com/newreport_printview.asp?eq=1&eb=1&esm=-2&oid=1884666494&sid=0&n=0&m=0&svr=20&r=60.09825361498109&la…1/84 Similarity Index8%Internet Sources:8%Publications:0%Student Papers:0%Similarity by Source
12M.Com Semester IV Advertising and SalesManagement English Version by InstituteOf Distance And Open Learning UniversityOf MumbaiFrom M.Com Semester IV Advertising andSales Management English Version(M.Com)Processed on 20-Aug-2022 14:54 ISTID: 1884666494Word Count: 48670
Turnitin Originality Report
sources:5% match (Internet from 14-Nov-2012)http://www.mu.ac.in/myweb_test/sybcom-avtg-eng.pdf3% match (Internet from 22-Nov-2021)https://mu.ac.in/wp-content/uploads/2021/11/Advertising-English-Version.pdfpaper text:UNIT – I INTRODUCTION TO1ADVERTISING Unit Structure 1.0. Objective 1.1. Introduction 1.2. Concept andFeatures of advertising 1.3. Significance of advertising 1.4. Classification ofadvertising 1.5. Elements ofIntegrated Marketing Communication (IMC) 1.6. Behavioural Model (E.K. Strong AIDA) 1.7. DAGMAR Model(Russel Colley) 1.8. Hierarchy of Effects (Lavidge and Steiners) 1.9. Summary 1.10. Exercise 1.11References11.0. OBJECTIVES After studying this unit the student will be able to - ?Understand concept and features of advertising ? Explain significance ofadvertising ? Describe classification of advertising? Discuss the elements of IMC ? Relate AIDA model, DAGMAR model and Hierarchy of effects model withreal life 1.1. INTRODUCTION Marketing mix includes: Product, Price Promotion and Place.1Advertising is an element of Promotion mix. The term advertisingis derived from the Latin word ‘advertere’ which means ‘to turn the mind towards’. Every advertising turnsthe attention of the people towards product. The dictionary meaning of the term advertising is ‘to give publicnotice or to announce publicity.’ Advertising is a communication tool through which marketer / advertisercreates awareness about their new product / services and reminds about existing product / services to theirtarget customers. It also persuades customers to buy the product. Advertising has also been an effectivemunotes.in