Professional Documents
Culture Documents
Project Report
ON
1
DECLARATION
Place:-
2
ACKNOWLEDGEMENT
Concentration, dedication, hard work and application are essential but not the factors
to achieve the desired goal. These must be supplemented by proper guidance,
assistance and co-operation of people to make it a success.
I want to extend my regards to our all esteemed faculties, BBA department, D.A.V.
College, MZN for imparting to us such a priceless bundle of knowledge which helped
us in making a successful approach towards the project.
I would also like to thanks to the Chairperson, the faculty of D.A.V. College, MZN and
my mother whose blessings and unending support made it possible for me to go
forward and succeed in my motive
SUMIT KUMAR
3
PROJECT REPORT
4
TABLE OF CONTENTS
No.
Executive Summary 8
1. Introduction 10
2 Literature Review 13
3. Research Methodology 19
4. FMCG an Introduction 24
5. Understanding Differentiation 35
advertisement
5
Consumer Promotions in India
Annexure 102
6
EXECUTIVE SUMMARY
The FMCG market is set to treble from US$ 11.6 billion in 2003 to US$ 33.4 billion
categories like jams, toothpaste, skin care, hair wash etc in India is low indicating
middle class and the rural segments, presents an opportunity to makers of branded
from consumer 'upgrading' in the matured product categories. With 200 million
people expected to shift to processed and packaged food by 2010, India needs
Rapid urbanization, increased literacy and rising per capita income, have all
new opportunities. Around 45 per cent of the population in India is below 20 years
of age and the young population is set to rise further. Aspiration levels in this age
The importance of consumer sales promotion in the marketing mix of the fast
moving consumer goods (FMCG) category throughout the world has increased.
7
Retailers stated that role of word of mouth and television advertising was very
The research concludes with the discussion of the results, managerial implications
8
CHAPTER 1
INTRODUCTION
9
INTRODUCTION
categories, which consist of several brands. In FMCG products like tea, coffee and
is likely to also differentiate itself in terms of getting identified with the consumer. A
demonstrate this claim at a retail outlet especially given the fact that the quality of
water varies across areas even in a specific geographical region. It is also essential
In a certain situation, the company may have two offerings in a product-line and
involved. This is a complex situation where differentiation decides the growth of the
brand and the perceived difference between the offerings. An added layer to the
complexity is the same brand name being used for the offerings. Fairness cream is
a category in which the benefit is the fairness of the complexion. A brand like Fair
and Lovely built over the years still has a strong association with the category but
under tremendous pressure from competitive brands and the most important
criteria which these brands is the herbal touch associated with them. Herbal
10
personal care in India has a strong tradition of herbal care. Fair and Lovely had to
launch its herbal variant (it used the same brand probably because of the brand
equity built up over the years). The interesting fact is the differentiation being
conveyed by advertising. The original version uses an aspiration route in which the
Estimates based on China's current per capita Consumption, the Indian FMCG
market is set to treble from US$ 11.6 billion in 2003 to US$ 33.4 billion in 2015. The
Penetration level in most product categories like jams, toothpaste, skin care, hair
wash etc in India is low. The contrast is particularly striking between the rural and
urban segments - the average consumption by rural households is much lower than
markets, which are likely to expand as the income levels rise. This provides an
excellent opportunity for the industry players in the form of a vastly untapped
(including the high penetration categories) in India is low as compared to both the
and preferences, is further expected to boost FMCG demand. Growth is also likely
categories
11
CHAPTER 2
I. LITERATURE REVIEW
12
LITERARATURE REVIEW
Pravin Durai
By going through this article I have come across some points which you should
look upon. If you want to read the article it is present in the appendix. Following are
some points:-
Advertising is the only direct method which helps to reach masses of potential
and consumption.
which is otherwise called attitude, of the consumer and· also the consumption
pattern of the society in general. Thus, the impact leads to cultural and social
information to the consumer which enables him or her to compare and choose from
the products and services available. Advertising is the most economical means by
The advertiser must constantly assess the situation to choose the right
In order to ensure that the advertisements reach the target consumers in a most
effective way and gets right response from them, it has to be ensuring that such
advertisements are presented in the right way. The following steps on the part of
the consumer may ensure that the advertisements are on the right track.
14
· Ascertaining the level of utility derived with other similar consumers.
In the article Dr. Alexander-- Told about a model which exemplifies the attitude or
Value added ads- In addition to providing information about the product; Value-
missing link between brand attributes and the customer perception, between
Comparative ads- the advertiser compares the 2 brands of the same product
category. The ad can be copied as the Pepsi and sprite example in the case. They
have used the same story but both have them had a different approach.
15
Informative ads- these ads are used to provide information to the consumer about
Health and Hygiene ads- these ads show that the product is taking care of the
does the product do? How does it help you? The ad tells you all. These are some
of the techniques.
Lifestyle ads- Another way to. nave an impact on the consumer's mind is
Demographic ads- these ads are meant for different segments based on age, sex
etc. Farex Cereal Food for infants is an advertisement targeted directly towards the
infants, as it comprises a healthy food for them. It is also targeted indirectly towards
the mother.
Packaging ads- Advertisement is trying to lure the customers to buy their products
on the basis of the way they are brought in front of the consumer's eyes ie.
Packaging. Dabur has brought in different flavors in the market of fruit juice. E.g.
Mango, Pineapple, Orange, Mixed Fruit Jete. All these are in different packages,
i.e. 50 ml, 1000 ml, etc. They claim that unlike other juices, which have
16
preservatives in them, these products are without preservatives. Hence, the punch
Price ads- Marketers also lure the customers by showing in an advertisement that
Cadbury India advertised the 5-Star chocolate by offering 30% more chocolate in
Celebrity ads- Celebrities are mainly used in the advertisement either to lure the
rural people in buying a particular product or in forcing the young generation to buy
portraying that a particular product is best in--qtJality because a person who is also
very well known in his/her field endorses it. The impact of these stars in
17
CHAPTER 3
I. RESEARCH METHODOLOGY
18
RESEARCH OBJECTIVES:
advertisements
3. To get an insight into retailers’ views regarding the schemes being offered in
consumers.
19
Need Identification:
Establishing need for market scan
RESEARCH METHODOLOGY
Defining Methodology
Data Collection
Primar
Secondar
y
y
Data
Data
Checklis
t
FGD
Intervie
ws
Analyzing Data
Final Report
20
Final Report
Methodology:
was conducted. The idea was to probe and get deeper insight into sales promotion
scenario in toilet soap market and to tap perceptions of retailers and consumers. In
order to address above mentioned objectives (i) study of secondary sources was
carried out, 10(ii) in-depth interview of six retailers was undertaken and 11(iii)
sampling was used for both retailers as well as consumer studies. Six retailers
ranging from small kirana store to supermarket were approached. All the retailers
were located in the Noida. The respondents for consumer study were postgraduate
students in the age group of 19-24 belonging to middle and upper middle and
upper class. The total respondents were 30 in number. They were residing in hostel
or as PG hence sole decision-makers for this category. Also this age-group being
targeted at them.
The geographical scope of the study was restricted to the NOIDA city due to time
and resource constraints. The study being exploratory in nature, the sample size
was restricted to 30 consumers (student group) and 6 retailers. Focus being mainly
on in-depth probing, the generalizations drawn are only indicative and not
conclusive.
21
CHAPTER 3
I. FMCG AN INTRODUCTION
22
FMCG –FAST MOVING CONSUMER GOODS
23
24
BRIEF DECRIPTION OF INDIA FMCG MARKET
25
MARKET OPPORTUNITIES IN FMCG:
26
According to Estimates based on China's current per capita Consumption, the
Indian FMCG market is set to treble from US$ 11.6 billion in 2003 to US$ 33.4
in eating habits and the increased affordability of the growing Indian population
Penetration level in most product categories like jams, toothpaste, skin care, hair
wash etc in India is low. The contrast is particularly striking between the rural and
urban segments - the average consumption by rural households is much lower than
markets, which are likely to expand as the income levels rise. This provides an
excellent opportunity for the industry players in the form of a vastly untapped
(including the high penetration categories) in India is low as compared to both the
and preferences, is further expected to boost FMCG demand. Growth is also likely
categories
27
EVOLUTION:
Post liberalization
Entry of MNCs
Nirma enters and changes the focus to ‘Value for Money’ in the 70’s
28
CHARECTERSTICS:
Barriers to Entry networks and intense competition, but the sector is not capital
intensive.
of Customers companies results in value for money deals for consumers (e.g.
29
FORECAST 2010:
10%CAGR)
Seasonal consumption
Urban
30
31
32
CHAPTER 5
I. UNDERSTANDING DIFFRENTIATION
33
I. UNDERSTANDING DIFFERENTIATION:
number of buyers
34
BRAND
loyalty in
fast
moving consumer goods categories is a topical issue, with several brands resorting
to price cuts across categories. More importantly, price cuts or sales promotion by
themselves do not seem to have done much for brands in terms of sustaining
brand loyalty. They may attract consumers in the short run: consumers may stock
the brands and consumers new to the brand may try it. But over a period of time, a
brand's value may get diluted in consumers' psyche, and will eventually lose a
strong base of consumers. The following are some aspects of marketing mix
Product differentiation
perceivable, there are chances of brand loyalty being formed based on satisfaction
35
with greater performance or fit of product with needs. In this case, loyalty is driven
Price differentiation
If the price differentiation in the market is perceivable, price-led loyalty might exist
FMCG brands, which come out with frequent sales promotions based on freebies.
customer might go in for higher priced options. Price-led loyalty has to be carefully
considered with other marketing mix elements and the consumer should never
perceive dilution, especially in low-priced bands. Hence, lower prices should create
Branding activity
If the category is organized and there is branding activity, there will be greater
loyalty than there would have been if the category were unorganized. Branding
which will influence the consumers not only with regard to functional attributes but
also with symbolism. Hamam soap's portrayal of its pure ingredients with the child
36
Branding activities in a broad sense could range from advertising to sales
The following were the observations from the literature survey and the examples
The factors indicate that there will be a large segment of consumers for whom
price-led loyalty will dominate. Hence there will be strong behavioural loyalty in the
segment and only weak attitudinal loyalty. There is thus spurious loyalty in this
sector.
There is a moderate level of symbolic and functional differentiation which has been
brands such as Dove, Pond's Dreamflower talcum powder, Gold Flake, Will's Navy
Cut, Amul and Cadbury. These brands have probably built strong attitudinal loyalty
In the FMCG sector, brand habit is high whereas attitudinal loyalty is low. As
The factors discussed cannot be treated in isolation: they are to provide a synergy
to result in brand loyalty. The combination of these factors and the timing of the
37
combination is the topical challenge which marketers face in an environment where
Local challengers
Some of the most successful FMCG brands in 2002 came, not from the stables of a
Hindustan Lever and a Colgate, but from obscure regional players such as
Detergents. Over the past couple of years, brands such as Gold Winner and
Gemini in refined oils, Anchor White in toothpastes and Ghari in detergents have
managed to sustain double digit growth rates, even as the market leaders have
Yes, the comparison is unfair, as the local brands had a minuscule base to start
with. But these brands have demonstrated it is not impossible for a new challenger
to break into the traditional bastion of one or two large FMCG players. Traditionally,
large FMCG categories in India have been dominated by just one or two players,
who rule the roost by dint of their sheer financial muscle and distribution reach. But,
of late, successful regional brands have been finding chinks in their armour. And
how!
Aggressive pricing
In the edible oils market, as national players were forced to hike their selling prices
in response to rising commodity prices, both Gemini and Gold Winner have used
aggressive pricing to woo consumers away from the national brands. Packed tea
too, has seen similar trends. The limited differentiation in grocery and the flexibility
38
offered by a restricted area of operations have stood these companies in good
stead. Anchor White, among the few debutants in the toothpaste market to garner a
significant share, first wooed the retail trade with high distribution margins, and then
used rock-bottom prices to lure consumers into trying the product. Though none of
these companies can match the market leaders in adspend, they have used
focused regional and local advertising to draw consumers' attention to their brands.
The mushrooming of local and regional media has undoubtedly helped the local
While the local brands have been adding to their brand portfolios, the market
In keeping with its "power" brand strategy, Hindustan Lever's marketing strategies
Lifebuoy, Rin, Surf and Vim. The company phased out brands such as Sunlight in
detergents, and Jai in toilet soaps, so as to focus better on its 30 power brands.
The strategy appears to have worked, as brands such as Lifebuoy and Rin have
39
In fact, HLL's "power" brand strategy has found a few followers in the FMCG
market, with companies such as Godrej Consumer also announcing plans to focus
Streamlining ad spend
While the "power" brand strategy has helped the leading players put their
marketing prowess behind their most important brands, it has not really helped
them save on ad spend. For most FMCG companies, advertising and promotion
spends in 2002 grew faster than their sales. In high penetration categories such as
a higher-priced brand. The slew of "100 gm free for every 150 gm" offers in
shampoos and skin creams tailored their marketing strategies to bringing in new
users, through scaled-down versions of their brands in affordable pack sizes. The
India, has helped pep up the company's topline and is now a large contributor to
the company's revenues. Nestle India is now trying out a similar small-sized Rs 5
40
Shampoos have been among the few FMCG categories to register a positive
growth rate in 2002, and growth in this category has been driven mainly by sachet
Overall, the FMCG slowdown of the past three years has served a useful purpose.
At one level, it has made sure that the dominant players in the market no longer
enjoy unlimited pricing power, as they have in the past. There now appears to be a
greater effort on the part of the players to hold selling prices and look at their own
challengers has made sure that consumers of FMCG products have a few more
choices in their purchases of essentials. Is selling soap the same as selling a TV?
It isnt. The difference is how the particular product is sold and more importantly,
how is it distributed. India is a unique market, where the manufacturers who deliver
products at the doorstep, which is the ideal way to deliver anything, spoil our
products. Different products are sent to the consumer differently. Depending on the
number, the price of the product and the complexity of the selling process,
they may vary from direct selling to selling through a channel that may have as
many as
four levels between the manufacturer and the consumer. A look at a few of them
Most FMCG (fast moving consumer goods) products are not hard-sold to the end
consumers. Sales are built up largely by pull - a technique using advertising and
consumer promotion. The sell-in happens to the trade i.e. to various members of
41
the distribution channel - the Carrying&Forwarding/Super-stockist, the distributor,
the wholesaler and most importantly the retailer, who is the interface with the end-
consumer. This chain forms the most important link in getting the product
A large MNC in the FMCG industry may be covering as many as 1 million outlets
across the country with the help of thousands of distributors. Even a mid-sized
company covers at the least 1 lakh outlets. Factoring in the vagaries of operating in
more than 25 different states, each with its own sales tax complexities, different
octroi structures within a state, distribution is extremely complex in India. If the sell-
in does not happen to this channel for whatever reason or is sub- optimal, a
CHAPTER 3
42
I. UNDERSTANDING ADVERTISEMENT
ADVERTISEMENT
I. UNDERSTANDING ADVERTISEMENTS
new ones try appealing to prospective consumers to get into their `consideration’
set. There are ads for children, housewives and youth. With advertising
expenditure in the order of Rs. 8000 Crores per annum in the recent times and the
43
brand to create and sustain consistent associations, which may be desirable in
Creating-brand-awareness
When a new brand enters a category or creates a “new to the market” offering, it
needs to create brand awareness. This would depend on whether the product is a
on how a brand would want to create awareness. Itch Guard, a new branded
convey the concept. While the unit cost of the product may be low, the involvement
level of the consumer on the solution offered by the brand could be associated with
high involvement. A brand in this situation is likely to also benefit from point of
The “high-utility” solution has to be conveyed to the target segment, which probably
was using traditional substitutes. In this example, a typical brand personality need
not be built at least before the benefit is sold to the consumer and hence all
44
promotional efforts should be directed at conveying the benefit and creating a
brand association with the category itself (as it is a pioneering brand in the
posters at the point of sale and perhaps conveying the superiority of the offering
Kissan Bistix in contrast is a unique offering, which is aimed at children who have
to initially make a change in their habits regarding the consumption of this offering
(should be eaten with a biscuit stick after it is dipped in chocolate/any other side
dish flavour which is a part of the package). Moreover the price of the offering is
Rs. 5 and this would be associated with low involvement. Moreover, there is strong
and some of them may have price points below the Rs. 5 level. Mass advertising
perhaps could create trials but it may be difficult to sustain the purchase only
through advertising. Innovative contests built around popular hobbies may enable
the brand not only to create excitement but also sustain the interest over a longer
period of time. This may create repurchase and probably a cross-section of the
segment may make the consumption a part of their snacking habit. Acceptance of
an offering like this requires a longer time interval and an innovative approach
display at the counter of retail outlets. Besides, given the price point and the
offering there is also a need to be selective in market coverage for the offering.
Creating awareness in a durable category (even if the consumers are familiar with
45
effective after the initial advertising awareness created by the brand. LG, Samsung,
Santro and Whirlpool are brands that have been successful but less than a decade
Samsung which created brand awareness through its “World Series” ads, also
introduced innovative features in its products and Santro’s success (in terms of its
create awareness and this happens both by advertising and positive word-of-
strengthen the word-of-mouth could add to the promotional effect. This approach
could be compared with the advertising blitzkreig of several new brands of cars.
Skoda, almost an unknown name in India, has been able to meet with considerable
success (in its niche) because of word-of-mouth for its Octovia model than through
conventional advertising. The brand has also been selective in its market launch
and this adds to the “expectation excitement” for prospective consumers in other
Concept--Selling
company. The product may be a good one but the initial concept selling plays a
vital role in the diffusion of the product. Advertising has to be used in conjunction
46
awareness of the category but print advertisements are required to address the
differing perceptions of consumers about the risks and value associated with a new
offering. The low penetration of rice-cooker may make an interesting case study.
How should the offering be positioned especially when in the urban context gas
stoves have a high degree of penetration? Would the device be useful for cooking
menu other than rice? What is the perception of the target consumer? Or is it
consumers? Should all retail outlets be used or only specific retail outlets in an area
selling product concepts. Primary advertising sells the concept while secondary
advertising highlights the features of the brand. It may be difficult to generalise how
a firm should link these two kinds of advertising. There is a need to consider the
product/market situation before such discussions are taken. When a brand has a
competitive advantage in terms of time (first entry) it could sequence the two kinds
now the penetration of washing machines is not high) fifteen years back, Videocon
used a very effective primary advertising to sell the concept and create awareness
about the category. “It washes, rinses and dries” was the message and slowly over
a period of time the brand added features that were very specific to the brand.
offerings at the same period of time. The category of quartz watches provides such
an example. HMT made an attempt to sell the concept during the initial stages
when the category was introduced. Titan, which has a huge chunk of the category,
took a major initiative not only to build its brand but also to sell the concept of
quartz watches. Besides there were also a number of offerings from the
unorganised or assembled sector which offered low-price points at the lower end of
the market. In a situation like this, the pioneering brand or any brand, which builds
itself quickly stands to gain. This is because consumers become familiar with the
category within a short time, especially when prices come down rapidly. Besides,
such quick diffusion is also enhanced by the fact that the category is a necessity
item rather than a luxury. There is also the element of social visibility associated
with the category. Hence for a national brand, mass advertising is a pre-requisite,
Definition:
For the purpose of this study, following definitions of sales promotion were kept in
mind. Kotler defines sales promotion as: “Sales promotion consists of a diverse
7Roger Strang has given a more simplistic definition i.e. “sales promotions are
48
Hence, any forms of incentives (price cut or value added nature) offered for short
15 for 75 gms.) of toilet soap brands. This was closely followed by 11 schemes
(40%) in premium segment (> Rs.15 for 75 gm.). Thus it could be inferred that
49
Nature of Schemes
With respect to the nature of the schemes, premium (free gifts) were found to be
the most frequently used schemes in both premium and popular segment of toilet
soap industry. No such scheme was offered by any brand in the economy segment.
It could be inferred that as the price of soap in this segment was less than Rs.8, it
might not be possible for the companies to offer this type of premium promotion.
Secondly, the consumers in this segment were likely to be price sensitive and such
50
Premium (Free Gift) Offers
Six out of 13 premium offers were a part of the companies own portfolio e.g. on
buying 2 Dettol soaps, a Dettol Talc, 18 grams worth Rs.25 was given free.
• Bonus pack schemes (Buy one get one free/more for the same price) were
used to load the consumers so that they would not buy competitive brand at
• To reward and retain existing loyal customers and to enhance brand image
through interactions/associations.
innovative gifts.
brand and its equity e.g. giving (new) Mysore Sandal Talc free with the
51
Price-offs:
• Contrary to belief, premium soap brands were giving price offs (3 price off out
soap segment, as the size of the premium segment especially the higher end
of the premium segment might be very small e.g. Dove (priced at Rs.45 for
100 gm) Rs.10 off. It could be inferred that frequent use of sales promotion
The incentive price ratio was calculated by taking the monetary value of the
incentive offered to the consumer and dividing it by the amount of money he/she
needs to spend in order to avail the offer. The ratio varied from 0.15 to 1.00 among
various brands (Table-4). The ratios in premium brands varied from .15 to .71. For
example, in case of Mysore Sandal and Palmolive Natural (premium soaps) the
incentive ratio was .15 and .17 respectively. With this level of incentive neither
regular premium soap users will feel rewarded or get attracted, nor the popular
The highest incentive ratio in case of Fair and Lovely soap was an introductory
offer. Such a high incentive again was not likely to generate desired response in
52
terms of trial. Instead the company could have leveraged on its parent brand
namely Fair & Lovely Cream which is well entrenched in the market. So with the
purchase of Fair & Lovely tube free soap would have given better results in our
opinion.
Five out of six retailers viewed that whenever sales promotion scheme was
announced on TV, it created pull and they were more than willing to stock such
brands. For example Medimix and Dettol contest was not advertised on TV, hence
there was very little awareness leading to unsold stock till 6 months. While Lux
Gold Star which was heavily promoted on T.V. is recalled even today.
Retailers observed that in most cases sales promotion scheme on a brand might
Handling Problems
Many a times retailers had to handle various sales promotion offers simultaneously
in a category and also across categories and there was no formal communication
planning either from the dealer or the company. Remembering each offer and
53
handling was a problem especially for a small retailer which was often a as one-
man show.
As obvious from the above table, sales promotion was not the main reason for
switching brand in this category. Need for variety was the predominant reason.
It was found through deeper probing that even though consumers would have
switched brands due to sales promotion, there was reluctance about admitting the
It was further found that consumers had positive disposition towards promoted
brand. As a result when toilet soap brand was changed for variety, the brand which
54
Recall of brands being promoted:
As seen from above, Lux (Gold Star offer – most promoted and advertised brand)
had the maximum recall. This brand used TV advertisement heavily to announce
sales promotion offers. Six out of 30 did not recall any sales promotion scheme on
any brand. It could be inferred that i) hard core loyals to a particular brand (eg.
Hamam) would never (pay attention to any announcements of any other toilet soap
brand. ii) Unless sales promotion offers were properly communicated to the target
audience, required impact might not be created and iii) Unless promotional offers
ignored.
55
Willingness to buy on sales promotion offer
Sixty-three per cent of the sample did not show willingness to buy a brand due to
promotion while 27% showed willingness and 10% were not sure. This indicates
that when 27% showed willingness, and 10% consumers who were not sure, these
groups might be lured through innovative and lucrative sales promotion offer.
Forty per cent of the respondents had said that sales promotion had the ability to
Long-term impact
withdrawal of promotion. Eighty per cent of the respondents indicated that they
would not continue. But 20% said they would. Thus, it could be inferred that
promotions in this category (low involvement products) might encourage trial and
56
Preference of Schemes:
Price off was the most preferred type of scheme. Sixty-three per cent of the
respondents ranked price-offs as number one or two. This was from an upper
income (biased sample, in which 18 out of 30 were from income group category
>3,00,000/- p.a.
Perceived Quality:
Ninety-three per cent of the respondents had a perception that the quality of the
promoted brands remained the same during promotion, while 7% felt that it was
inferior than before. It can be inferred that promotions were not leading to negative
brand quality perceptions. It was further reinforced when 53% of the respondents
said that sales promotion would not weaken their loyalty towards the brand.
promotion, “to increase sales” was ranked highest followed by “to attract switchers”
and “to sell excess stocks”. While providing value to customers” and “to reinforce
company image” were ranked lowest. This indicates that consumers believed that
companies were undertaking such activities only for their own benefit and not for
57
perception studies, it is evident that there was a matching of perceptions regarding
Such inputs from the retailers would be useful to companies. The retailers had the
perception that those schemes which were announced through mass media had
better response. This was reinforced by the consumer survey which showed that
matching with the consumer perception regarding the same. Thus both viewed that
companies were using sales promotion activities mainly to increase short term
sales or encourage switching or selling excess stock and not really to give value
58
Implications:
The findings of the empirical study indicate that unless the brand to be promoted is
have any major impact. Clearly this shows that managers need to invest into brand
building exercise so that his/her brand appears in the consideration set of the target
consumers. Only after this should he spend time, money and energy on sales
promotion activities. Sales promotion should not be used in isolation but need to be
integrated with other tools and in line with the overall positioning of the brand. Also
the importance of the role of mass media came out clearly in both the studies.
through mass media in order to create awareness The role of retailer in influencing
insignificant which also supports the above observations. Toilet soaps are low
to the shop for the purchase of soap is the final decision maker of the brand. Hence
it is essential that companies need to design attractive, striking, visible POPs for
that premium (free gift) was popular with companies. While both retailers and
free gift has to be appealing and high for the target consumers. Repetitive use of
the same premium (soap dish) for a prolonged period may have negative 18
effect on the loyal customers. When the company is giving its own product free as
59
The findings exhibited that both the retailers and consumers perceived that sales
promotion activities carried out by the companies for increasing sales in short term
and clearing excess stocks. What it implies is that companies need to use sales
promotion synergistically and communicate so that they provide value to the target
considered critical aspects for the success of sales promotion activities by the
touch with the market. From the study it was found that smaller retailers felt
neglected and not enthused to implement the schemes, particularly when additional
compensatory margins. It can be seen that the retailer and consumer perceptions
of mass media. This implies that the retailer would be a rich source of information
about the consumer and the likely response to sales promotion activities.
Developing a system to tap such responses from time to time both at retailer and
consumer level would be helpful for planning future sales promotion activities. In
60
61
PROBLEM FACED BY MARKETERS
Fast moving consumer goods players Dabur, HLL are among the major companies
found to violate Advertising Standards Council of India code during the first quarter
which seven were asked to withdraw, while nine were asked to modify for violation
of the codes.
The council asked Dabur India to discontinue its Red Toothpaste commercial after
which it said specific indgredients in the product could give the consumer strong
teeth.
Hindustan Lever's Clinic All Clear, which is now being endorsed by Bollywood
couple Bipasha Basu and John Abraham, was also on the list of defaulters.
The company was found guilty of 'false and misleading' campaigns in its hoardings
and radio commercials. HLL had projected the shampoo as a solution to hair fall
through its tag-line baal girney ka sawaal hi nahi (no question of hair fall). ASCI
This time around, several FMCG companies have come under ASCI's (Advertising
Standards Council of India) scanner as complaints against their ads have been
upheld by the Consumer Complaints Council for the period between January and
Marchthis year.
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Dabur, Hindustan Lever, Johnson & Johnson and Colgate Palmolive are the few
FMCG majors who have had to withdraw their ads during this period.
For Dabur India, it was its Dabur Red Toothpaste; its pack claimed `strong teeth.'
The TV commercial claimed `Get strong teeth from Dabur Red Toothpaste which
ingredients declared on the pack are not scientifically and clinically proved to
provide strong teeth. The claim is false and needs to be validated with clinically
proven data, said ASCI. The TV commercial has been discontinued. Assurance is
awaited from the advertiser on the modification of the promotion message on the
In the case of HLL, the radio commercials for Clinic All Clear Hair Defense claim
"Baal girne ka sawaal nahi (question of hair fall does not arise)" was looked upon
favourably by ASCI. Its hoardings also claim no dandruff and no hair fall. The
complaint made is about the gross exaggeration of facts, said ASCI. The radio
commercials distort facts and are misleading consumers into believing that Clinic
All Clear stops hair fall. The ads from radio and hoardings have thus been
withdrawn.
Johnson & Johnson's comparison of its Stayfree Secure Dry sanitary napkin brand
exaggeration. The claim being `as good as' is vague and ambiguous as it does not
the communication vague and implying `the market leader' position among the
"As the claim relies on a survey conducted by TNS India, one needs to scrutinise
the survey design, methodology and questionnaire to check the validity of the
survey, study the actual findings and check whether the same reflects in
conclusion," ASCI stated. The TV commercial had been discontinued from March
this year.
For Colgate Palmolive (India), it was its Colgate Sensitive Toothbrush being
"In the absence of a notation in the advertisement on the source supporting this
claim, the advertiser is required to substantiate the claim," read the complaint. In
this case, the ad has been discontinued and the advertiser has assured
The study conducted in association with the assistance of Yahoo, MSN, Lycos, and AOL
combined a total of 200 FMCG online campaigns executed across Europe. The aim of the
study was to quantify the average impact that European ad campaigns have on traditional
branding metrics, and create benchmarks for categories such as FMCG which has
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The research methodology follows global industry standards set forth by Dynamic Logic
(1999) which surveys consumers in two categories; campaign exposed and non-exposed. In
total 160,000 individuals were surveyed across Europe representing the two groups. The
full 'funnel' of branding metrics was surveyed; brands awareness, ad recall, message
The conclusion of the study found that all 5 branding metrics were positively impacted.
Similarly to other categories, FMCG brands which advertised online had the highest impact
across brand awareness (both aided and un-aided) and brand favorability in line with market
norms and mirroring similar research from the US. Furthermore, it was found that effective
frequency across each of the brand metrics was increasing even at 10+ average exposures,
building the case against perceived 'ad burnout' which traditionally is thought to be at much
lower average exposures levels. Hence FMCG branding metrics continue to increase with
additional exposures.
that he/she cannot remember. In order that product should get through the clutter it
is believed that a single selling message has to be repeated for a large number of
times. Thus the most significant problem with the USP approach to advertising is
that it requires a large media budget to repetitively air the advertisements and such
ads often annoy consumers. And hence instead of creating a consumer base it
may drive away the potential customers as against this, UCP by itself provides
solutions to all the marketing problems poised by the widely accepted USP
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approach. Basically it aims at the core of the problem. It eliminates the problem
Bridge positioning can play a role in bridging the gap between customer perception
and product USP by relying more on UCP than USP based positioning statement.
Objectives: Objective of the study was to find out finer points of developing bridge
positioning statement and how it can bridge the gap between the UCP and USP.
The study further focused on how bridge positioning can be validated in terms of
sales.
A USP is that distinct and appealing idea that sets your business favorably apart
from every other generic competitor. While A UCP is that distinct and appealing
idea that is built on customers’ perceptions that sets business favorably apart from
every other generic competitor. Brands which had high success has USP=UCP.
This means positioning statement helps to have better brand recall. Thus, Bridge
Application of bridge positioning helped to generate better sales and achieve status
of leader brands. UCP and USP matching makes the brand recall better and the
It is quite obvious that only the clear and well-defined USP is not the panacea for
all marketing ills. Today’s trying economic conditions have forced difficult decisions
on companies. Most are making conservative decisions that reflect a survival mode
think on continuous basis is critical for survival. Most marketers assume the
product USP to stay constant overtime that is contrary to reality. Companies may
66
have to change the USP to stay contemporary and relevant. It is obvious that there
has to be another parameter that makes a success of the product. What companies
need to understand is product’s UCP. UCP by itself provides solutions to all the
marketing problems poised by the widely accepted USP approach. Basically it aims
at the core of the problem. It eliminates the problem from the roots rather than
If an Organization fails to recognize the customers’ perception then the initial surge
of customers would quickly come to a screeching halt and the brand would fade
into obscurity along with the organization. On the other hand, following customer’s
perception not only offers an emotionally positive solution to their needs but also
serves to enhance the current customers’ perception of the brand. Following this
with an excellent product/service and customer support will leave an indelible mark
on the existing customer’s memory, which will create brand loyalty. Bridge
Selection of the brand: Mountain Dew, a lemon drink, with the USP “The Spirit of
Adventure - Do the Dew” is marketed in India. However, this USP failed to position
Mountain Dew in the minds of the consumers as an adventure drink. This was
Similarly, Natrilix-SR a diuretic widely used in India was stagnating and not
The study was to focus on UCP and USP of this product and how UCP if
determined through the study can improve sales through better brand recall and
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preference of doctors. Antihypertensive brand was selected as this segment is
fastest growing segment all over the world including India. Natrilix -SR was
Advertisement, POP, print ads, Sample catch cover and detailing folder.
2. Identifying the UCP: As the important part of the research was to find
3. Formulating the UCP:A ranking technique was used to find the most
based on this survey. The study was to focus on UCP and USP of these
products and how UCP, if determined through the study, can improve
This is the core subject of the research and to substantiate the same, two
the mind-set of the consumer with regards to relation between the USP
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of NatriliX-SR/ Mountain Dew, a lemon drink and their perception about
the product. So basically the aim is to find how existing USP match
BRIDGE POSITIONING .
categories, which consist of several brands. In FMCG products like tea, coffee and
is likely to also differentiate itself in terms of getting identified with the consumer. A
demonstrate this claim at a retail outlet especially given the fact that the quality of
water varies across areas even in a specific geographical region. It is also essential
In a certain situation, the company may have two offerings in a product-line and
involved. This is a complex situation where differentiation decides the growth of the
brand and the perceived difference between the offerings. An added layer to the
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complexity is the same brand name being used for the offerings. Fairness cream is
a category in which the benefit is the fairness of the complexion. A brand like Fair
and Lovely built over the years still has a strong association with the category but
under tremendous pressure from competitive brands and the most important
criteria which these brands is the herbal touch associated with them. Herbal
personal care in India has a strong tradition of herbal care. Fair and Lovely had to
launch its herbal variant (it used the same brand probably because of the brand
equity built up over the years). The interesting fact is the differentiation being
conveyed by advertising.
The original version uses an aspiration route in which the brand’s ultimate benefit is
confidence built up by the usage of the product. The herbal variant’s advertising
has a strong focus on the traditional product benefit - facial complexion that
appeals to youth. The nature of the models chosen are different and the ultimate
category (fairness) the advertising differentiation carries the variants of the brand to
“consumer types” who may be drawn towards the respective variants. Goodlass
Nerolac in its recent advertising campaign for decorative paints, which uses
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CHAPTER 7
72
Expenditure on sales promotion by various marketing companies in India is
estimated to be Rs. 5,000 crore and is growing at a robust pace every year
product, freebies, scratch cards. In the year 2001, there were as many
refunds and rebates that temporarily reduce the cost of the goods or service’.
between types of promotion. A list of the different types of price and non price
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Table
Although a wide variety of price and non-price promotions are launched in the
promotions, namely price offs and coupon offers (Blattberg, Briesch and Fox,
1995). Promotional tools such as free gift offers, extra product offers that are
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However very little academic theory or research has looked at how
Table
TABLE
75
The product categories analyzed in the study covered Consumer Durables,
Before proceeding with the main analysis, the frequency of promotions across
Table
(45%) and Durables (44%) sectors. The Services sector accounts for the
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lowest number of promotions. Within FMCG, the most frequently promoted
product categories are soap, detergent liquid/powder and tea. These are also
computer. The most frequently promoted categories in the Services sector are
The different types of promotions identified in the study include price offs,
free gift offers, sweepstakes, extra product offers, contests, exchange offers
The most popular promotion is the free gift promotion, which constitutes more
extra product promotion (8%) and the price off promotion (8%) in popularity. In
followed by the extra product promotion followed by the price off promotion.
promotion.
The specific details about the different types of promotions - price offs,
section.
1. Exchange Offer
This promotion is seen mainly in the consumer durable product category. This
promotion requires the consumer to exchange an old product for a new one
and get some benefit, usually a price reduction. For example, in case of cars,
the scheme offers the consumer a price reduction of Rs. 10,000 on the new
car in exchange for an old car. For pressure cooker, the scheme offers a price
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reduction of 40% on exchanging an old cooker for a new cooker. In case of
old model of a product (e.g. AC, refrigerator, music system, mixer grinder, gas
stove) to get a price reduction on the new model. Apart from exchanging an
old durable good, the scheme also involves exchanging a small TV for a big
free service such as extended 3-year warranty or free insurance. Often the
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At times, the product offered as a free gift constitutes an upgrade to the original
Internet telephony kit, software titles and multimedia package is offered along
a Free Internet upgrade and 20 GB, Web Camera, Printer, Britannica CDs,
software. In case of fast food restaurants, the free products are items such as
soft drink, bread stick, pineapple fudge, garlic bread, ice cream cookies. Here the
At other times the free product may be a related product or product used in a
similar context e.g. cooking or cleaning or personal care or eating. For kitchen
products, the free product are items used in the kitchen such as plastic
containers, metal spoon, tawa, non stick pan, idli stand, serving bowl, table mat
and OTG.
products such as bleach, washing soap, washing powder, bucket, bath soap,
floor cleaner and utensil cleaner. In the skin care segment, the free products are
other personal care items such as soap, body lotion, shampoo sachet, shaving
cream and toothpaste. In case of food products, the free product comprises
At other time the free product may be totally unrelated to the original
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purchase. For example the consumer may be offered a free pen with a skin
care cream or free batteries with soap. It is possible that, in such, cases, the
example, in case of health drinks, the free product are items such as cricket
bat, zoom ball, story book, pencil box, biscuits, binoculars, toy bike, cricket set,
products are products relevant to children such as comics, sticker, toy, tattoo,
In some cases, the free gift offered along with the purchase is another product
variant offered by the company. For example in case of fruit juice the
consumer is offered the guava flavor fruit juice when he/she buys 5 packs of
orange flavor. In case of spices, the consumer is offered Kashmiri mirch along
with purchase of the regular spices. Several free gift offers have a pre
has to make a certain value of purchase before he is entitled to the free gift.
Often, there are smaller gifts associated with purchase of smaller pack sizes and
larger gifts associated with purchase of larger pack sizes of a product. In most
cases, the price of the free gift is not mentioned. The brand name of the free
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3. Sweepstake offer
The sweepstake offer gives the consumer a chance to win a large prize
through luck. It ususaly involves a lucky draw or a scratch card based on which
the winners are decided. The prizes offered on this promotion can be broadly
classified into two types. The first type of prize is a trip to a foreign location
e.g. Paris, London, Thailand, Singapore or Malaysia. Many brands offer a trip
to the South Africa World Cup as a promotional attraction. The second type
of prize are durable products such as Bike, Car, Watch, Washing Machine,
Camera, Sunglasses, Gold Jewellery, Gold Coin. Gold has a major appeal as a
soap and personal computer. In some cases, the details of the prize on the
crores.’
avail of the promotional advantage. The promotional benefit is usually in the form
of money saved as a result of buying two ore more products at the same time. In
certain cases, the promotion requires the consumer to buy additional units of
case of bath soaps and detergent cakes, this promotion requires the
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consumer to buy three bath soaps/detergent cakes and get one
soap/detergent cake free. In case of fruit juice the consumer is required to buy 5
packs of
fruit juice and get one pack of fruit juice free. This promotion seems to be
popular in categories where the extra units of the product offered on the
printers, this scheme requires the consumer to buy a printer and scanner
together and get a price reduction. In case of consumer durables, this scheme
attempts to induce the consumer to buy greater number of products from the
same company. For example the scheme requires the consumer to buy AC
and refrigerator or AC and microwave of the same brand and avail a price
buy toothpaste and toothbrush together or buy shaving cream and blade together
Restaurants as well where the consumer is required to buy a pizza, coke mobile
and garlic bread and get a saving on the combination purchase. In case of
FMCG products, this type of promotion bundles together products that are
use complements.
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5. Contest offers
Fast Food restaurant, this promotion requires the consumer to fill up a coupon
and get a chance to meet a film star such as Hrithik Roshan. In case of soft
and get a chance to meet a movie star. In other product categories, the prizes
Most of the extra product promotions (65%) are seen in the FMCG category
where the extra units of product serve as additional consumption units for the
Soaps, Fruit Juices and Hair Oil. In case of toothpaste the promotion
requires the consumer to buy one toothpaste and get the second toothpaste
free. In a talcum powder extra product promotion, the consumer is offered 20%
extra in the same pack. This promotion is also seen in the Services sector.
In case of Internet service provider, this promotion offers extra hours on the
Internet and free Internet access on Sunday. In case of fast Food restaurants,
the promotion offers a second pizza free along with the original pizza or a slice
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Other Offers
A variety of promotions are seen in the ‘Any Other’ category. One frequent
avail the promotional benefit. In case of fans, this sort of promotion requires
worth Rs. 480. Another such promotion requires the consumer to buy a fan,
300. In case of health drinks, the promotion requires the consumer to pay Rs.
of effort rather than money from the consumer. For example, in case of tea,
the consumer is required to pay Re. 1 and get a Britannia biscuit pack free along
with the tea pack. In case of salt, the consumer is required to collect a
Yet other types of promotions require an investment of both money and effort
example, a soft drink promotion requires the consumer to collect crowns and
put in some money to get a price discount on the soft drink. In case of ice
cream the consumer is required to collect three ice cream wrappers to get a
scratch card which gives him the opportunity to win lakhs of prizes. In case of
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chocolates, the promotion requires a consumer to exchange empty chocolate
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CHAPTER 8
87
I. RECOMMENDATIONS AND SUGGESTIONS
II. CONCLUSION
I. RECOMMENDATIONS
improve it frcfm its present position? We find lots of suggestions floating. Some of
Information.
2: Effective advertising is necessary to confirm the public about the product at the
3. 4. Although product benefits can be shown most effectively by TV. It should not
mislead the consumers. The advertisement is judged by its impact, and by its
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4. Identifying the right Celebrities for different products and the degree of influence
The ad agencies should use simple ads to convey the message of the brand. It
Importance of Claim:
importance / of claim made in it, Many advertisements make important claims. But
these claims should be important for the consumer too. If a buyer gives importance
for quality, there is no point in speaking about the cheap price, similarly if cheap
proposition. Each advertisement must make a strong factual claim to pull the
Believable:
way is .to quote facts and figures about tests proving your claim. However,
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S0Q1etimes advertisement given in prestigious magazines is believed by-the
readers.
Uniqueness:
Uniqueness draws attention. According to the four fold principle of AIDA (Attention,
Interest, Desire and Action-buying), any effective advertisement should draw the
recognition and acceptance rather than gaining conviction or buying action rely on
uniqueness.
Repetition:
a basic principle of memory. Naturally, the more times an advertisement is Iun, the
more likely it is that any person has seen one of the advertisements recently.
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Companies that are able to spot trends early and those that are committed to
meeting her changing needs will lead and prosper in the future. Product superiority
married with a favorable price-value equation will form the basis of winning
Consistently supporting those facing highest competitive pressure with above the
line spends while sustaining momentum on stable brands with tactical activities in
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II. CONCLUSION
create a positive attitude among the Consumers in the long run. On the other hand,
when the features of the product purchased do not corroborate the claims made in
and goodwill in the minds of consumer about the product featured by conforming to
This Endeavour of the present survey can thus be concluded on a note that
repetition surely has very profound, widespread and long-lasting impact on the
emotions and behavior exhibited by the consumers with regard to their purchase
marketers face while trying to generate sales and favorable response. But the
the brand or the ad prove and determine the very subtle demarcation between an
application which improves effectiveness and the same effect considered as a brain
wash or damage
Advertising serves many generic purposes, but for specific categories like FMCG,
The techniques discussed are not exhaustive. The general awareness of the
consumer today is more concerned about the value of his money and time. All
compels the advertisers to innovate and develop new techniques to attract the
customers. We can say that the advertisers use these different means of
advertising in order to lure the customers to buy their products. It is not necessary
of advertising are being used to make sure that the consumers buy the respective
company's product.. Briefly, we can say that the different aspects of advertising are
Every advertisement has some multiplier effect which gives a greater benefit with
respect to/ the amount spent. Recall of an advertisement varies from individual to
individual, and a company may calculate its advertisement multiplier for measuring
of advertisements to make them more creative and innovative in their reach to the
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Following observations are made after making an analysis of data collected from
respondents. This highlights the role the TV commercials play in moulding the
advertisements.
2) Almost half of the segment of respondents likes to watch ads regularly. This
3) A significant portion of the people prefers to watch ads because of the '
5) A small segment of the respondents think that the advertisements are totally true
or reliable. All the rest of them think that they are either sometimes deceptive or
mostly deceptive.
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6) Major chunk of the respondents feel that celebrities 'presence in the ads is highly
required. They feel models are familiar and their presence is reassuring. Moreover,
because of the high positive image of the celebrities consumers feel the
such products as soft drinks, cars, suitings, premium range products and luxurious
items.
7) More than half of the consumers are not able to relate themselves with the
lifestyle shown in the TV ads. This is because the people are not able to conform
the exaggeration shown in the respect of product benefits with their own picture of
reality.
8) When asked to recall an advertisement in respect of any Fmcg, almost all the
respondents were able to recall only one or two advertisements or the tag lines of
their favorite brands. They could also immediately relate the celebrities they have
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10) Although informative content is more liked by the respondents but with the
advent of too many satellite TV channels, the use of celebrities has become an
important issue for the advertiser. This is to make the consumer more conscious
Product differentiation should be strong enough to create a wide gap between two
brands. If a differentiation technique does not create a wide gap between the two
brands, then the customer is not able to differentiate the same leading to less brand
where the customer is not able to differentiate between two soaps. Lux, Cinthol
appears to be same which was not the case earlier. As the product differentiation
technique does not create a wider gap between one brand and the other, customer
It is possible provided the unique selling point matches unique customer perception
or when the customer perception is same as unique selling point, the positioning
statement can act as a bridge between communicator (manufacturer) and the user.
This `bridge positioning’ can lead to long-term relationship with the customer.
Most marketers assume that their product USP stay constant. Companies should
change the USP to stay contemporary and relevant. USP based positioning is more
effective However in order to have better brand recall, what companies need to
various channels. It is the opinion that the customer forms by being exposed to
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advertising, competitor’s claims and advertising, word of mouth, personal likes and
dislikes, etc.
association with a particular product may lead to a formation of opinion for the
brand that the product belongs to and hence may affect the UCP.
A company can determine its UCP using simple tools like Questionnaire
Association Technique.
Customers’ interest is focused on what your product or service does for them - the
The key to unlocking the decision to buy is offering benefits that outweigh what the
competition offers. These benefits are also a strong part of the process that leads
It is quiet clear that the company should try and get the highest level of fit between
the USP and the UCP of the product / brand they are promoting. Therefore the
As already noticed from the conclusions of the research, a fit between the USP and
the UCP is desired for the product to ensure a fair chance of success. But what are
the options available for the brand manager if there are indeed gaps between the
97
Since UCP is formed over the years and has its roots in factors beyond the
immediate control of the company, the company should try and align the USP with
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99
QUESTIONNAIRE FOR COLA DRINKS
Name:
------------------------
Address:
-----------------------
Male ( ) Female ( )
2. When you think of cola drinks, which Brand comes to your mind?
Yes ( )
No ( )
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5. What do u find interesting in' an ad?
Pepsi
Coca cola
Thums up
101
QUESTIONNAIRE FOR CHOCOLATES
Name:
-------------------------
Address:
Male ( ) Female ( )
Below 15 ( ) 15 - 25 ( ) 25 - 35 ( ) 35 - 45 ( ) Above 45 ( )
Yes ( )
102
No ( )
Kit kat
Munch
Perk
Dairy Milk
Others
103
QUESTIONNAIRE FOR TOMATO KETCHUP
Name: ________________________
Address: _______~---------------
Male ( ) Female ( )
Yes ( )
No ( )
104
5. What do u find interesting in an ad?
Maggi
Heinz
Kissan
105
QUESTIONNAIRE FOR FAIRNESS CREAMS
Name:
Address: _______________________
Male ( ) Female ( )
Below 15 ( ) 15 - 25 ( ) 25 - 35 ( ) 35 - 45 ( ) Above 45 ( )
2. When you think of Fairness Creams which Brand comes to your mind?
Yes ( )
No ( )
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5. What do u find interesting in an ad?
Fairever
Fairone
Others
7.On a scale of 1 to 5 , rate the quality of advertisement of the following FAirness creams
FAirever
FAirone
Others
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