Indian Institute of Management Rohtak

Post Graduate Programme in Management

Marketing Management II

Marketers are returning to traditional advertising

Submitted by:
Section A
Group 6

Amrita Datta PGP13021

Aneesh Pandey PGP13025
Ankur Ganeriwala PGP13029
Anmol PGP13031
Ann Maria Renny PGP13032
Anurag Choudhary PGP13038
Aparajita Ghosh PGP13041
Ashutosh Lakra PGP13046
Ayushi Jain PGP13050

Submission Date: 15th December 2022

Submitted to
Dr. Neha Bhardwaj
Marketers Are Returning To Traditional Marketing

TABLE OF CONTENTS

Executive Summary 3

Introduction 5
Traditional and Non-Traditional Advertising 5

The Shift from Digital to Traditional 7

Trends in digital and traditional marketing 9

Television advertising 9
Radio advertising 10
Newspaper/Magazine advertising 10

Marico’s marketing, selling, and distribution expenses 13

For the year 2022: 13
For the year 2021: 14

Causes for shift to Traditional Marketing 16

Algorithm echo chamber 16
Reliance on third-party cookies 17
Advertising clutter 17

The Future of Traditional Advertising 18

Conclusion 20

References 22
Marketers Are Returning To Traditional Marketing

Executive Summary

Advertising is the most common and proven marketing tool used by companies. Proper
advertising will help generate hype around products and also attract potential buyers. When used
correctly, effective advertisement helps launch and establish brands in the market. It can also be
very pricey and is frequently highly regulated, especially in larger markets. Despite the widespread
internet usage, some online advertising techniques are still seen as non-traditional forms of
advertising.

Non-traditional advertising strategies can include wall murals, vehicle wraps, buzz agents,
flyers, or other literature distributed in unusual locations or situations. It is effective when there is
a tight budget and a target audience that can be easily reached through media other than TV, radio,
or newspapers.

The amount spent on TV media climbed from $193 billion to $206 billion between 2016
and 2017. Since 2016, the purchase of televisions has increased by more than 600%. Advertisers
may more accurately target their advertising by monitoring what their audience is doing online as
they watch. Newspaper readership has decreased by more than half in the previous 40 years or so.
The magazine industry's total income has declined drastically from $46 billion in 2007 to $28
billion in 2017. While the number of hours spent on digital media has grown since 2012, the
amount of time spent on print media has remained constant.

In the financial year 2022, Marico spent a total of 125.3 crores on its marketing, selling,
and distribution expenses, further broken down into subheads like marketing, entertainment
marketing, business promotion, and other selling and distribution expenses. Data shows a decline
in overall marketing expenses for the company and a substantial decline in the entertainment
marketing division and saw a contrasting increase in the other selling and distributing expenses.
Marketers Are Returning To Traditional Marketing

4
The efficiency of brand search ads was overstated by up to 4,100%. Similar research on
Facebook advertisements yielded a figure of 4,000%. P&G's Chief Brand Officer, Marc Pritchard,
reduced the company's digital advertising spend by $200 million, or 6%, in 2017. Unilever went
even further in 2018, reducing its digital advertising by over 30%. Advertisers are shifting their
media spending away from a narrow focus on frequency measured in clicks or views to a focus on
reach or the number of customers reached.

The excessive volume of advertising messages that clients get daily is called advertising
clutter. According to the CMO Survey, as a result, 19.8% of organizations raised their spending
on traditional advertising. The excessive volume of advertising messages that clients get daily is
called advertising clutter. Customers will not remember the brand or product, nor what the product
is because of so many advertisements. Digital clutter can also negatively impact the brand in
consumers' mindsets. It contributes to advertisement aversion and fosters a negative attitude
toward advertising.

Advertising has seen a resurgence in the current years, with companies increasing their
spending on traditional advertising. Consumer-facing companies are at the head of the change,
with B2C service companies increasing spending by 10.2%, and product companies increasing it
by 4.9%. "Convergence marketing" is the coordinated use of traditional media, public relations,
and online advertising to communicate a single advertising or brand-building message. When an
organization creates an advertisement using traditional media while also listing its email or
website, they, in reality, advertise 'twice'.

In summary, Marketers are reverting to traditional media, which is higher impact and
provides an exponentially higher ROI. The statistics around the globe and in India prove this shift.
While innovation is to be expected, non-traditional methods will surely be explored, and traditional
methods will continue to be favored.
Marketers Are Returning To Traditional Marketing

5
Introduction

Advertising is the most common and proven marketing tool used by companies. Its
objective is to persuade those who are most likely to be willing to spend money on a company's
goods or services to make a purchase. Advertising has clear objectives- Introducing a product,
emphasizing the benefits of a product or service, reminding customers about or even specific goals
with unique campaigns. Proper advertising will help generate hype around products and also helps
attract potential buyers. It also helps in the following ways-

1. Crucial for introducing a new product:

2. Helps in creating consumer awareness
3. Target orientation
4. Helps in monitoring demand and supply
5. Building a brand image

Effective advertising, when used correctly, effective advertisement helps launch and establish
brands in the market. Every firm aspires to carve itself a place in the market.

Traditional and Non-Traditional Advertising

When discussing marketing or advertising, the majority of people immediately conjure up

traditional advertising. This covers the "normal" media placement locations, such as print media,
radio, cable or broadcast television, or outdoor billboards.

Traditional advertising also includes typical company-related collateral items like

brochures, business cards, and stationery. These are the goods that consumers typically anticipate
from a well-established company and are helpful in establishing your brand, identity, and image.
Marketers Are Returning To Traditional Marketing

6
Typically, traditional advertising is well-established and easy to utilize. It is extremely
quantifiable in terms of viewership and who is shown in the advertisement. However, it can also
be very pricey and is frequently highly regulated, especially in larger markets. A traditional
advertisement frequently needs to adhere to the guidelines of the media where it is placed.
Traditional marketing was essentially the sole marketing method up to the advent of the internet
in the 1990s.

Traditional marketing channels include

● Broadcasting (TV, Radio, etc.)

● Print (Magazines, newspapers, etc.)
● Outdoor (Posters, Billboards, Bus/Taxi wraps)
● Direct Mail (catalogs, etc.)
● Window signs and displays
● Telemarketing (Phone calls, text messages)

Non-traditional advertising might include a range of initiatives and techniques to spread

your message. Non-traditional advertising, in contrast to standard advertising, frequently entails
the use of unusual or uncommon ad space or technique.

Despite the widespread internet usage, some online advertising techniques are still seen as
non-traditional forms of advertising. Without a non-traditional web presence, firms might not have
been able to contact potential customers via Google ads or banner ads, for instance.

Non-traditional advertising strategies can include wall murals, vehicle wraps, buzz agents,
flyers or other literature distributed in unusual locations or situations, placards, mobile advertising,
guerilla marketing, blogs, YouTube videos, and t-shirts, magnets, or other promotional items
distributed to potential customers. Non-traditional advertising is effective when there is a tight
budget and a target audience that can be easily reached through media other than TV, radio, or
newspapers. It's a good strategy to convey your idea because the unconventional way it might be
Marketers Are Returning To Traditional Marketing

7
displayed helps people remember it. It benefits a very focused audience and frequently costs less
than traditional advertising. However, measuring it is challenging and could take longer to plan or
plan a campaign.

Digital marketing channels include:

● Social media (Facebook, Instagram, etc.)

● Affiliate marketing
● Email marketing
● PPC (pay per click
● SEM (Search engine marketing)
● Content Marketing
● Inbound Marketing
● Website

The Shift from Digital to Traditional

Traditional marketing involves any kind of marketing communication effort that employs
offline media such as television, print, broadcasts, direct mail, and telephone. It is generally
considered an expensive and time-consuming process, but the results of traditional marketing
strategies are easy to measure. Due to the medium employed, the audience reached can be limited.
In many cases, it also limits interaction, thus effectively resulting in a one-way exchange of
information- providing limited scope for feedback.

Digital marketing employs channels such as online advertising, email marketing, social
media, and affiliate marketing to promote products and services. The campaigns are generally
planned over a short duration, and it is often a more cost-effective, affordable, and rapid way to
encourage the desired product. There is scope for feedback, as the channels offer two-way
communication. It offers various advantages, such as the ability for brands and consumers to stay
Marketers Are Returning To Traditional Marketing

8
updated with their products and services due to information symmetry caused by internet access
penetration.

There is also greater engagement with the consumers and target audiences, as customers
can interact with representatives after making online purchases and access information available
at their will. There is very little room for misinterpretation of information, and consumers can
easily compare and contrast the options available to them- brands have a chance to advertise their
product, and it's the point of parity in a cost and time-friendly way. There is also no time restriction
on the communication activities undertaken, increasing the selling points that are present.
Traditional marketing still needs more scope for innovation, interaction, and creativity. Still, its
advantages diminish the possibility of it being disposed of or discarded entirely in the near future.

While digital ads offer a wide range of benefits, audiences can grow indifferent to them-
whereas traditional media is much more memorable and recollected by an enormous number of
people. Due to internet access and penetration, traditional media is also more accessible to rural,
lower-income households and higher age groups, and other marginalized populations.

Consumer surveys report that respondents anticipate significant shifts in how traditional
advertising is conducted, but less than 8% of them could envision a world without it (World
Federation of Advertising Report). TV spending increased from $193 Bn to $206 Bn between
2016-17. It was also reported that most TV viewers usually operate a second screen during the
time they spend in front of the TV screen and communicate with friends and family through texts.
FM Radio accounts for nearly 42 percent of the media consumed during automobile rides and
reaches a broad population.

Customers rely upon more than one medium in order to enhance their knowledge of the
brand. Thus, combining digital and traditional marketing plays an essential role in the final
purchase decision. While a brand's social media presence still needs to be considered necessary in
determining a consumer's trust or interest in the brand, most still consider a strong presence or
effort in the traditional marketing space essential.
Marketers Are Returning To Traditional Marketing

Trends in digital and traditional marketing

Despite what many industry experts had expected, traditional advertising still plays a
crucial role in most marketing strategies. The State of Advertising Report from the World
Federation of Advertisers states:
Respondents widely rejected the assumption that traditional advertising will no longer exist
in five years. The statement, "Looking ahead five years, I can envisage a future without traditional
advertising forms," received just 8% of the substantial agreement. Twenty-eight percent of
respondents strongly disagreed, and 34 percent somewhat disagreed.
According to more than 70% of respondents, "direct-to-consumer businesses would
encourage the large conventional marketers to create new and better ways of communicating with
their consumers," the survey also foresaw substantial changes in the way traditional advertising is
carried out.

Television advertising

Despite increasing global spending on digital advertising before 2020, the business
managed to survive. In late 2017, consider the following:

● The amount spent on TV media climbed from $193 billion to $206 billion between 2016
and 2017.
● Coca-Cola's firm earns $2.13 for every dollar spent on TV instead of $1.25 from digital
channels, showing that TV routinely outperforms digital advertising in terms of returns.
● Since 2016, the purchase of televisions has increased by more than 600%.
While the differences between TV programming and digital media are narrowing, the gap
between consumption is rising. According to Nielsen, nearly 90% of Americans watch TV using
Marketers Are Returning To Traditional Marketing

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smartphones, laptops, or other gadgets. Seventy-one percent of Americans are researching the
show they will watch, and 41 percent are contacting friends and relatives about it.

Advertisers must make informed assumptions about who has been seeing their shows for a
long time. Advertisers may more accurately target their advertising by learning more about their
audience and what they are interested in by monitoring what their audience is doing online as they
watch.

Radio advertising

Radio has been a minor player in the advertising scene for decades, hovering around $14
billion, supported mainly through regional firms (about 5 percent of total U.S. ad expenditure).
However, according to Nielsen, AM/FM radio still accounts for 42% of all US time spent with
audio media and reaches 90% of Americans weekly. The emergence of streaming services,
podcasts, and satellite radio has changed how consumers consume audio information.

The pandemic outbreak affected local enterprises negatively, and had to reduce their
advertising expenditure to survive. Additionally, as many Americans switched to working from
home, they spent far less time in their automobiles, which was time they frequently used to listen
to the radio.

Newspaper/Magazine advertising

Newspaper readership has decreased by more than half in the previous 40 years or so,
according to Statista, and the trend is increasing. A variety of causes contribute to this decline:

● Customers now consume their news on their tablets and smartphones rather than traditional
newspapers, thanks to the availability of digital gadgets.
Marketers Are Returning To Traditional Marketing

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● Environmentally conscientious consumers are choosing not to support large-scale paper
printing.
● Local news providers around the country are failing as a result of aggregation by internet
behemoths like Google and Facebook.
● Advertisers are shifting away from newspapers and magazines, which have limited
targeting options and reach, in favor of more profitable mediums.

According to a HubSpot survey conducted in 2017, while the number of hours spent on
digital media has grown since 2012, the amount of time spent on print media has remained
constant. Consumers also trust print advertisements more than digital ones, depending on them
more significantly when purchasing.

The magazine business is going through an exciting transition. While the overall number
of magazines in the United States has remained relatively stable over the previous 20 years at
roughly 7,200 to 7,300, and magazine reading has climbed somewhat, the magazine industry's total
income has declined drastically from $46 billion in 2007 to $28 billion in 2017.
Marketers Are Returning To Traditional Marketing

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When we look at the Indian advertising landscape, Traditional marketing holds a clear
advantage over Digital, holding over 65% of the market share. Here is the sectoral breakdown of
digital marketing spending in India.
Marketers Are Returning To Traditional Marketing

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OTT companies such as Netflix, Amazon Prime, and Hotstar spent $300 million on
advertising to attract customers’ attention. Traditional media received $250 million of the $300
million. Even our technologically innovative millennials and digitally native Gen Z enjoy our
analog media.

Marico’s marketing, selling, and distribution expenses

In the financial year 2022, Marico spent a total of 125.3 crores on its marketing, selling, and
distribution expense which was further segregated into subheads such as:
● Advertisement, traveling, and communication expense
● Business promotion expenses
● Other selling & distribution expenses
● Free sample
● Freight- outward
● Market research expenses

For the year 2022:

Marketers Are Returning To Traditional Marketing

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For the year 2021:

Marketers Are Returning To Traditional Marketing

15

The above data shows a decline in the overall marketing expense for the company and a
substantial decline in the entertainment marketing division and saw a contrasting increase in the
other selling and distribution expenses.
Marketers Are Returning To Traditional Marketing

16
Causes for shift to Traditional Marketing
Algorithm echo chamber

"Consumer heterogeneity and paid search effectiveness, A large-scale field experiment"

study discovered that the efficiency of brand search ads was overstated by up to 4,100%. Similar
research on Facebook advertisements yielded a figure of 4,000%. Despite all of the data available,
businesses still need to answer the question of which part of their advertisement budget could be
better spent.
When marketing companies pitch the ad space to clients, they claim that advertisements
shown by their company will create or cause behavioral change. They claim that it will create sales
lift, i.e., an incremental increase in sales during the promotional time. They back this claim by
displaying the conversion rate.

The advertisement firms concentrate on raising the conversion rate because it is one of the
primary criteria companies use to determine which medium and company to advertise their goods.
Companies can target clients based on their search and purchase patterns in digital advertising.
Companies pay agencies and consultants to target advertisements to those who are already very
likely to purchase their items.

The conversion rate is relatively high when advertisements are directed at the most likely
clients. Conversions will generate significant new revenues once the advertisements are directed
at individuals who need more time to be ready or prepared to acquire the products. This can be
why the social media contribution to company performance in The CMO Survey has been flat
since Feb-20.

Mobile marketing expenses as a percentage of the total marketing budget climb to 23% in
Jun-20, but its impact on firm performance remains flat on a scale of 7 from 3.2 to 3.3. Chief Brand
Officer of P&G, Marc Pritchard, reduced P&G's digital advertising spend by nearly 200 Mn USD,
Marketers Are Returning To Traditional Marketing

17
or around 6%, in 2017. Unilever went further in 2018, reducing its advertising on digital media by
more than 30%. P&G's organic sales increased by 7.5% in 2019, and Unilever's increased by 3.8%.

Both organizations improved because they shifted their media spending away from the
focus, which they had narrowed down to the frequency that is quantified on clicks. They
concentrated on the reach or the quantum of customers reached. Previous data showed that
companies spammed clients with online advertisements around 20 times each month. This
frequency of spamming reduced gains and upset many loyal and faithful customers. As a result,
companies cut their mailing frequency by around 10% and reallocated ad budgets to finding new
and less frequent clients who were not watching the commercials. The companies also closely
investigated new consumers to understand their motivations to purchase, allowing them to
recognize the groups of underserved potential customers.

Reliance on third-party cookies

Marketers have depended on third-party cookies for years to track website users,
employing extensive data on their search decisions to optimize the user experience and target
customers with targeted ad experiences. Third-party cookies, on the other hand, are being phased
away by Google on Chrome browsers by late 2023 and Apple on its iOS14 operating system.
According to the CMO Survey, as a result, 19.8% of organizations raised their spending in
traditional advertising (apart from online approaches).

Marketers will be compelled to rely on segmentation strategies more analogous to old

advertising models due to this shift in the advertising landscape. Marketers will need to focus on
broadening their reach without intelligent data-driven targeting.

Advertising clutter
Marketers Are Returning To Traditional Marketing

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The excessive volume of advertising messages that clients get daily is called advertising
clutter. Brands use different methods to advertise their products. As a result, the level of
advertisement clutter across various mediums is very high. This cause various problems.
Customers will not remember the brand or product, nor what the product is because the consumers
consume so many advertisements.

Digital clutter can also negatively impact the brand in consumers' mindsets. When
consumers see many advertisements, people tend to develop the habit of entirely ignoring the
advertisements. It contributes to advertisement aversion and fosters a negative attitude toward
advertising.

The Future of Traditional Advertising

In the past decade, advertising has stepped out of the spotlight in favor of more
contemporary digital advertising. However, as we saw, there has been a resurgence in the current
years, with companies increasing their spending on traditional advertising. Consumer-facing
companies seem to be at the head of the change – the B2C service companies increasing spending
on traditional advertising by 10.2%, and B2C product companies increasing it by 4.9%.

The recent increase in attention towards traditional advertising will continue in the future-driven
by several upcoming and ongoing trends seen:

1. Breaking the monotony of online advertisements.

Cluttered digital advertisements are leading to frustrated customers and a negative brand
image. Traditional ads, comparatively, are receiving far more interest. Consumers seem to
be interested in watching traditional television ads and reading the print ads of the brands
they are satisfied with.
2. High consumer trust in traditional advertising
Marketers Are Returning To Traditional Marketing

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Research places print advertising, television advertising, direct mail advertising, and radio
advertising, in that order, as the most trustworthy source among consumers when making
purchase decisions.
3. Future decline of third-party cookies
With Google and Apple leading the charge in slowly phasing out third-party cookies, it
will become difficult for advertisers who used these to track website visitors and other
metrics to evaluate target consumers.
4. Using traditional media's boost from digital channels
Digital platforms sometimes offer ways to refine traditional media advertising further. An
example would be digital platforms’ help in bringing back direct mail culture using QR
codes.
5. Better brand and market fit
Certain campaigns use traditional media rather than digital media to reach consumers. The
impact they may create, or look to create, sometimes needs to be replicable online.
6. Credibility concerns over digital effectiveness
Marketers have become wary of hyped returns of digital media in recent years. It may be
partially attributed to the need for a standardized measuring method for the efficiency of
internet advertising as well as dubious revenues.

In the managerial scenario, traditional marketing has supporters for many reasons. It is
considered an effective medium in helping build a brand and improving customer acquisition.
Secondly, studies have shown traditional marketing to elicit higher and more favorable Consumer
to Consumer messages. This impact, or word-of-mouth advertising cycle, gives managers more
control over the "echo verse" and essential performance indicators.

While businesses have increased their attention towards traditional advertising, they seem
to have different preferences or biases towards any one form of advertising. Organizations, instead,
seem to incline towards combining traditional media with online advertising in their campaigns to
help gain maximum exposure for their advertising message.
Marketers Are Returning To Traditional Marketing

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Contrary to previous predictions, online media will only be able to replace traditional
media in the upcoming years. As such, the future direction in advertising seems to be towards
integrating the advertising media with the organization’s overall marketing and advertising
strategy, relying on a more careful analysis of what media to use. The end result of this integration
will be "convergence marketing," which is the coordinated use of traditional media, public
relations, and online advertising to communicate a single advertising or brand-building message
to the intended target audience.

Integrating the two means is advantageous since, on the one hand, traditional media, mainly
outdoor and print media, appear to be far more efficient at generating brand awareness.
Conversely, online campaigns seem more successful at simply "pushing" particular promotions.
These two are, therefore, complementary to each other, enhancing the final reach of the
advertisement.

Another benefit of integrating the two mediums of advertising is the double advertising
phenomenon. When an organization creates an advertisement using traditional media while also
listing its email or website, they, in reality, advertise ‘twice.’ In addition to raising awareness of
the business and its goods, this also makes it easier to interact with customers.

Conclusion

Advertising refers to interacting with customers of a good or service. They are paid
messages that are sent to inform or influence the recipients. It can be conclusively found that
marketers are returning to traditional marketing.

While it was a common perception that marketers are shifting to and will cement their stay
in non-traditional marketing methods, the perception is incorrect. Due to the pandemic, while there
has been a decrease in the spending and investment in traditional advertising, companies will now
Marketers Are Returning To Traditional Marketing

21
slowly revert to higher spending in traditional advertising due to the economic recovery post-
COVID. Television, newspapers, magazines, and FM Radio will become more important as they
will be required to break through the digital clutter. The statistics around the globe and in India
prove this shift- that marketers are reverting to traditional media, which is higher impact and
provides an exponentially higher ROI.

The well-established and easy-to-utilize marketing methods show steady growth in

consumption and shower more ROI on the organization’s proper marketing budgets. A majority
of legacy companies and firms allocate a larger chunk of their marketing budget to traditional
means, allotting only a smaller percentage to digital mediums, furthering the faith that the industry
places in traditional media.
The future does not seem to be too different- while innovation is to be expected, along with
scalability, non-traditional methods will surely be explored, and traditional methods will continue
to be favored and placarded by marketers.

Therefore, based on the statistics mentioned earlier, instances, and cases, it is concluded
that marketers are shifting to traditional marketing.
Marketers Are Returning To Traditional Marketing

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References

1. What Digital Advertising gets wrong. Harvard Business Review. (2021, August 27).
Retrieved December 14, 2022, from https://hbr.org/2021/02/what-digital-advertising-gets-
wrong?ab=at_art_art_1x4_s01
2. Why marketers are returning to traditional advertising. Harvard Business Review. (2022,
May 24). Retrieved December 14, 2022, from https://hbr.org/2022/04/why-marketers-are-
returning-to-traditional-advertising
3. MarketingSherpa, design: Scott McDaniel, code: Steve Beger, MECLABS. (2016, January
7). Marketing Chart: Which advertising channels consumers trust most and least when
making purchases. MarketingSherpa.
https://www.marketingsherpa.com/article/chart/channels-customers-trust-most-when-
purchasing
4. Madison Taylor Marketing. (2022, July 14). Traditional Advertising in a Digital Age.
https://madisontaylormarketing.com/pillar-page/traditional-advertising-in-a-digital-age/
5. The Hindu. (2019, December 27). Abhishek D Shah on the supposed death of traditional
media. https://www.thehindu.com/life-and-style/abhishek-d-shah-on-the-supposed-death-
of-traditional-media/article30411706.ece
6. Traditional and online advertising: an explanation of current and future trends. (n.d.).
Taylor & Francis Online. Retrieved December 14, 2022, from
https://www.tandfonline.com/doi/abs/10.1080/02500160208537957
7. Why Marketers Are Returning to Traditional Advertising. (2022, April 29). Harvard
Business Review. Retrieved December 14, 2022, from https://hbr.org/2022/04/why-
marketers-are-returning-to-traditional-advertising
8. Kruizinga - de Vries, Lisette & Gensler, Sonja & Leeflang, Peter. (2017). Effects of
Traditional Advertising and Social Messages on Brand-Building Metrics and Customer
Acquisition. Journal of Marketing. 81. 10.1509/jm.15.0178.
Section A_Group 6
ORIGINALITY REPORT

2 %
SIMILARITY INDEX
2%
INTERNET SOURCES
0%
PUBLICATIONS
%
STUDENT PAPERS

PRIMARY SOURCES

1
gettysburghs.libguides.com
Internet Source 1%
2
vocal.media
Internet Source 1%
3
www.coursehero.com
Internet Source <1 %

Exclude quotes On Exclude matches < 10 words

Exclude bibliography On
Section A_Group 6
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