MAM SAIT GEORGE

MARKETING ASSIGNMENT

1) A.
ADVERTISING

• Any paid form of non personal

communication that is transmitted to
consumer through such mass media
as television, radio, news paper,
magazine, direct mail, and out door
displays.

B. Discuss two major advertising decisions

1. Setting Advertising Objectives

Setting advertising objectives is the first step in developing an advertising
program. These
objectives should be based on past decisions about the target market, positioning,
and
marketing mix, which define the job that advertising must do in the total
marketing program. An
advertising objective is a specific communication task to be accomplished with a
specific
target audience during a specific period of time. Advertising objectives can be
classified by
primary purpose as:
1). Informative advertising, which is used to inform consumers about a new product
or
feature or to build primary demand.
2). Persuasive advertising which is used to build selective demand for a brand by
persuading consumers that it offers the best quality for their money.
3). Comparison advertising which is advertising that compares one brand directly
or
indirectly to one or more other brands.
4). Reminder advertising, which is used to keep consumers thinking about a
product. This
form of advertising is more important for mature products.

2. Setting the Total Promotion Budget

One of the hardest marketing decisions facing a company is how much to spend on
promotion.
How does a company decide on its promotion budget? We look at four common methods
used to
set the total budget for advertising: the affordable method, the percentage-of-
sales method, the competitive parity
method, and the objective-and-task method.
a. Affordable Method
Some companies use the affordable method: They set the promotion budget at the
level they
think the company can afford. Small businesses often use this method, reasoning
that the company
cannot spend more on advertising than it has. They start with total revenues,
deduct operating
expenses and capital outlays, and then devote some portion of the remaining funds
to advertising.
Unfortunately, this method of setting budgets completely ignores the effects of
promotion on
sales. It tends to place advertising last among spending priorities, even in
situations in which
advertising is critical to the firm's success. It leads to an uncertain annual
promotion budget, which
makes long-range market planning difficult. Although the affordable method can
result in
overspending on advertising, it more often results in under spending.
b. Percentage-of-Sales Method
Other companies use the percentage-of-sales method, setting their promotion budget
at a
certain percentage of current or forecasted sales. Or they budget a percentage of
the unit sales
price. The percentage-of-sales method has advantages. It is simple to use and
helps management
think about the relationships between promotion spending, selling price, and
profit per unit.
Despite these claimed advantages, however, the percentage-of-sales method has
little to justify it. It
wrongly views sales as the cause of promotion rather than as the result. "A study
in this area found
good correlation between investments in advertising and the strength of the brands
concerned—
but it turned out to be effect and cause, not cause and effect. . . . The
strongest brands had the
highest sales and could afford the biggest investments in advertising!" Thus, the
percentage-of sales
budget is based on availability of funds rather than on opportunities. It may
prevent the
increased spending sometimes needed to turn around falling sales. Because the
budget varies with
year-to-year sales, long-range planning is difficult. Finally, the method does not
provide any basis
for choosing a specific percentage, except what has been done in the past or what
competitors are
doing.
c. Competitive-Parity Method
Still other companies use the competitive-parity method, setting their promotion
budgets to
match competitors' outlays. They monitor competitors' advertising or get industry
promotion
spending estimates from publications or trade associations, and then set their
budgets based on the
industry average.
Two arguments support this method. First, competitors' budgets represent the
collective wisdom
of the industry. Second, spending what competitors spend helps prevent promotion
wars.
Unfortunately, neither argument is valid. There are no grounds for believing that
the competition
has a better idea of what a company should be spending on promotion than does the
company
itself. Companies differ greatly, and each has its own special promotion needs.
Finally, there is no
evidence that budgets based on competitive parity prevent promotion wars.
d. Objective-and-Task Method
The most logical budget-setting method is the objective-and-task method, whereby
the company
sets its promotion budget based on what it wants to accomplish with promotion.
This budgeting
method entails (1) defining specific promotion objectives, (2) determining the
tasks needed to
achieve these objectives, and (3) estimating the costs of performing these tasks.
The sum of these
costs is the proposed promotion budget.
The objective-and-task method forces management to spell out its assumptions about
the
relationship between amount spent and promotion results. But it is also the most
difficult method
to use. Often, it is hard to figure out which specific tasks will achieve specific
objectives. What
specific advertising messages and media schedules should be used to attain this
objective? How
much would these messages and media schedules cost?

2. Marketing ethics

Ethics - origin
Ethical standards - society expects them to follow
Following ethical codes help organizations build a positive image in society.

Ethics and marketing mix

Product - not hazardous to the environment, packing should carry statutory

warnings-cigarettes, medicine, toys, home appliances, open dating
Warranty and service
Redressal of customer complaints regarding a product

Price - e.g. premium pricing for low fat food

Place - illegally hoarding sticks for speculations
Promotion - hallucination, violence, snobbery, nudity and indecency, value system,
racism, exaggeration

MARKETING INOVATIONS & ETHICS

Just the other day I went to a store to buy a shirt & trouser. I went into the
change
room & tried it on!!! It looks perfect on me… I thought I looked tall, slim &
perfectly
in shape it that attire!!! I came back home very happy. The next day there was a
party & I thought of flaunting my shapely body & dress to all. To my utter dismay,
I
didn’t look all that macho in my dressing table mirror… I was aghast & kept
thinking
how the hell have I put on weight overnight & if I have, how come I am still
fitting
snuggly into this new pair. Its then when a friend of mine who is an interior
decorator told me how??? He explained to me that the mirrors in most of the
change rooms in the malls are slightly tilted inside so that the image is
stretched &
you look a little leaner & taller. I felt cheated!!!
We are all aware of the infamous Delhi Public School MMS case. I leave it to you
to
decide if a camera in a cell phone is a curse or a boom??? What to talk of other
innovations like the internet connectivity MP4, voice recording facility & more. A
cell-phone today, is a Phone too…
Mc. Donald’s is known for its marketing wisdom. They innovate in Globalization
with
respect to all their Ps. Have you ever tried to know the calories in a snack at
McDonalds? You will be surprised that one burger, coke & French fries has some
1080 calories. In a country where obesity is a problem & about 70% adults in urban
areas suffering from diabetes eating such rich food is colossal. Yet we find Mc D
gives catchy ads - “I am loving it!!!” Are We friends??? Recently Dr. Tim Lobsten,
Director of childhood obesity programmes at IOTF, USA, has said that 177 million
children under 18, all across the world, are currently clinically overweight or
obese
& Developing country like India is worst hit. He has also recommended “No TV or
Radio ads between 6am to 9pm”. But, do we have the Political & ethical will to
enforce this???
How many of you get phone calls in the afternoons when you are taking a cosy nap
in the afternoon, only to hear the pseudo modern girl say in a mundane voice “
Hallo, Ap ____ Bol rehe hain?? Kiya aap ko personal loan Ki requirement hain?” I
get
cheesed off & wonder how she got my number & name???
The other day there was a news in the news paper where school children were
involved in car thefts only to drive them for pleasure till the petrol lasted &
then
abandon them on the highway. This is the impact of myopic Advertising on these
youngsters where latent needs are evoked leading them to indulge in anti social
activities.
And I can go on & on, but for the limitation of time & the decorum of this dias…
Just think about it friends!!! In a bid to sell their products marketers bring in
new
product, features, marketing gimmicks to lure the markets not realizing the curse
it
is casting on the society as a whole. We talk of holistic marketing but only in
the
books & seminars…
It’s high time now that Marketers become more socially responsible & understand
that while they are accountable to their stakeholders for higher sales & profits,
they
are also accountable to the Society in leaving a more happier & healthier Earth
for
the generations to come.
All Marketing innovations must be ethical…

B. Marketing impact on individual consumers and society as a whole

Marketing’s Impact on
Individual Consumers
.Shoddy or unsafe products
.Planned obsolescence
.Poor service to disadvantaged
consumers

Marketing’s Impact on Society as a Whole

.False wants and too much
materialism
.Too few social goods
.Cultural pollution
.Too much political power
Goal 1: Know the major social criticisms of marketing

Marketing’s Impact on Other

Businesses
.Acquisitions of competitors
.Marketing practices that create
barriers to entry
.Unfair competitive marketing practices
Goal 1: Know the major social criticisms of marketing