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UNIVERSITY OF CALICUT
Submitted by
MOHAMMED SUHAIL M M
(CCASBBAR30)
Mr. LIPINRAJ K
CALICUT UNIVERSITY
CERTIFICATE
The information and data given in the report is authentic to the best of my
knowledge. The report has not been previously submitted for the award of any
Degree, Diploma, Associate ship or other similar title of any other University or
institute.
Date: CCASBBAR30
ACKNOWLEDGEMENT
First all I am thankful to God. the almighty for all his blessings throughout
my life with a light and that helped me to do this project in better manner.
MOHAMMED SUHAIL M M
TABLE OF CONTENTS
BIBLIOGRAPHY
APPENDIX
LIST OF TABLES
4.16 Figure showing Operating Profit of Five Companies Over Five Years 33
CHAPTER 1
INTRODUCTION
1.1 INTRODUCTION
The study tries to examine the growth pattern and trend of sales and
advertisement expense for the selected companies over a period from 2010-
2015.Further it seeks to evaluate the effectiveness on advertisement expense on
sales of selected soap manufacturing companies in India. The study is based on
primary and secondary data collected for advertisement expenditure and sales
revenue of five randomly selected sample companies operating in India, over the
period from 2010-2015, which are further classified on the basis of amount of
sales revenue as well on the basis of type of product
The term advertising originates from the Latin word “adverto”, which
means to ‘turn round ‘Advertising has been defined as any paid form of non-
personal presentation and promotion of ideas, goods or services, by an identified
sponsor’. Advertisement is a prominent feature of modern business operations
.one can encounter advertising messages, while watching T V, Reading
magazines, listening to radio, surfing the internet or even simple while walking
down the street, advertisement has a stimulating influence on purchasing
behavior of the customer. Advertising about selling goods and services more
often to more people for more money.
1
1.4 Research methodology
Data require for the study, was obtained through primary and
secondary sources secondary data has been collected from published finance
statement of company website. The Primary data has been collected from fifty
samples using questionnaire. Judgment sampling techniques was used for
sampling. The collected data was analyzed with statistical Tools like percentage
comparison constituted the analysis part. Graphs, tables and charts has been used
to present the analysis in a better way.
1.5 Limitation
1. As this project is a three week project, time is a limiting factor
2. The analysis is made only by taking into account data for a period of past five
years
3. The analysis has been made purely on basis of sample response. 100%
accuracy in response cannot be ensured.
1.6 Chapterisation
Chapter 5:This chapter deals with statistical tools like correlation, simple average
and percentage comparison.
2
.
CHAPTER 2
REVIEW OF LITERATURE
3.1 Conceptual literatures
Definition of Advertisement;
“According to Hall “Advertising is salesmanship in writing, print or
pictures or spreading information by means of the written or printed words and
the pictures.”
Characteristics;
Objectives;
3
Functions;
Strengths;
4
Role/ Advantages
A) Advantages to manufacturers
D) Advantages to consumers
6
Kinds of Advertisement
7
5) Reinforcement Advertising: This is a form of comparative advertising. It
assures current users that they have made the right brand choice and tell them
how to get the most satisfaction from that brand.
6) Short Advertising: When there is a short supply of product, shortage
advertisement is used. E.g. oil crisis. In this type of type of advertisement ,
new promotional objectives may be incorporated such as (a)educating the
people the most economic use of the product,(b) making appeal to save
resources, and (c) to reduce customer pressure on the sales force.
7) Co-operative Advertising: When manufacturers, wholesalers and retailers
jointly sponsor and share the expenditure on advertising, it is called co-
operative advertising.
8) Commercial Advertising: This is connected with selling products or ideas to
increase the sales volume. It is called business advertising. The different
forms of commercial advertising are ; (a) consumer advertising, (b) industrial
advertising, (c) trade advertising, (d)professional advertising, (e) farm
advertising etc.
9) Non-Commercial Advertising: This is used by non-profit organizations, for
instance, inviting donations, financial aids etc.
10) Surrogate Advertising: The word surrogate means ‘substitute’. In this type of
advertisement one product is substitute for another. Thus, surrogate
advertising refers to the strategy used by companies and advertisers to
promote a product secretly, because the law of the country may not permit
the advertising of that particular product. Surrogate advertising refers to
duplicating the brand image of one product to promote anther product of the
same brand.
8
5 M’s of Advertisement
Media of Advertising
A B C D E
PRINT OUT DOOR DIRECT MAIL BROAD OTHER
MEDIA OR ADVERTISING CAST FORMS
MORAL MEDIA
Posters Circular / sales Radio Internet
Newspapers Sky Letters Television advertisings:
Magazines advertisement Price lists Films Websites
Trade Electric Catalogues Screen slides Banners
journals displays Leaflets Pop ups
Periodicals Sandwich Pamphlets E-mail
board
Electric signs.
9
E-Advertising;
Advertising on the electronic media such as Internet, web, e-mail etc. is known
as e-advertising. Advertising on the internet is known as net advertising (or net
advertising). Thus e-advertising is considered as non-personal information
usually persuasive in a nature about a product or services by an identified
sponsor, hence all paid space on the web or in an e-mail.
Objectives;
Advantages;
10
10. It is possible to assess the impact of ads quite early. Hence, the
ad campaign can be changed before most of the money spent.
Selling concept;
This concept assumes that consumers will not buy goods voluntarily
unless the seller undertakes a large scale selling and promotional efforts.
Selling concept;
Sales promotion;
Sales promotion simply means the tools and technique to promote sales.
According to Roger, “sales promotion is short term incentive to encourage
purchase or sale of a product or services”.
11
Sales promotion offers an extra value or inducement to customers, dealers,
and sales force with the objective of creating an immediate sale. In short, sales
promotion includes all those activities which are directed towards promoting
sales.
Advertisement and sales are the two sides of the same coin. Now in the
modern business world, advertisement becomes necessary for the management
for increasing sales. Many firms are increasing the advertising budget.
Advertisement increases the demand of the products; hence large scales
production is facilitated. This reduces the cost per unit and therefore profit
increases. All the companies will not adopt the same kind of advertising media.
There are different advertising media under which business enterprise conduct
their advertising activity. The role of this mass mode of communication in
creating brand loyalty, determine entry and consequently increasing sales
revenue and profit of the organization.
12
Advertising begins from customer’s needs and wants. Advertising try to identify
these needs and want and develop products that will satisfy customers through
an exchange media. Advertisement is a persuasive communication which
attempts to change or reinforce one’ prior attitude and basically done not only to
inform customers about products rather it is a process, which further influence
and persuades customers to purchase the product.
13
Different studies have shown diverse results. However, in general, majority of
the studies have directed positive relationship between advertisement and sales.
Most of the studies have used time series data to capture the long term effect of
adverting on sales. Moreover, the area that, to what extent advertising’s
persuasive character works to alter consumer’s wants and consequently sales
have received scant attention.
3.3 REFERENCE
14
CHAPTER 3
INDUSTRY PROFILE
2.1 SOAP INDUSTRY
The lever brothers, England during British rule introduced modern soap by
importing and marketing them in the country. Tata set up India’s first indigenous
soap manufacturing unit when they purchased the coconut oil mills at Cochin,
Kerala. The first company created was North West Soap Company, situated in
the city of Meerut in utter Pradesh.
The Indian soap industry includes about 700 companies with combined
annual revenue of about 17 billion. Major companies in the industry include
P&G, unilever and Dial. India is a country with a 1030 million people with
household penetration of soap is 98%. Soaps are categorized into men’s soap,
ladies soap and common soap. There is little specialty soap like glycerin soap,
sandal soaps, specially flavored soaps, medicated soap and baby soaps. It might
be scented unscented in burs, gels and liquids. ITC LTD has started investing in
aggressive brand building and product development project to promote its
brands, fiama Di wills, vivel and superia. Top leading players in soap market are
HUL, Godrej consumer products LTD, Colgate Palmolive and Wipro consumer
care.
Its first product was vegetable oil later popularized under the brand name
“sunflower vanaspathi”. It aloes offers personal care product such as Wipro baby
soap, soap like Santoor, Chandrika as well as international brand like Yardley.
As march 2015 the company has 158217 employees serving over 900 of the
fortune 1000 corporations with a presence in 67 countries. Its market
capitalization was approximately $35 billion, making it one of the largest
publically traded company and the 7th largest IT service firm in the world.
15
ITC LTD
ITC is one of the India’s public multi business enterprises; It was
incorporated on 24 August 1910, as a imperial Tobacco company of India LTD.
In 1970 the company was renamed as, Indian tobacco Company limited and
further to ITC LTD in 1974.
The company completed 100 years in 2010.It employs over 2500 people
at more than 60 location across India. It online sales in 2014. ITC is today the
only company in the world to be carbon positive, water positive and soil waste
recycling positive. Its personal care products includes perfume, hair care andskin
care categories. Major brands are Vivel, FiamaDiWillis, Superia.
16
NIRMA
The company was incorporated on February 25-1980 as a private limited
company to carry on the business of manufacturing and selling synthesis
detergents, soap, chemicals and ailed products. The company became a deemed
public limited company in 1993nunder section 43-A of the companies Act
1956.Nirma is one the most recognizable Indian brands. It took on the might of
giant multinationals and wrote a new chapter in the Indian corporate history.
Starting as a one-man operation in 1969, today Nirma has about 14000
employee-bare and its annual turnover of more than 2500 crores. It has one of
the largest volume sales with a single brand name in the world. Karsanbhai
Khodidas Patel is an Indian Industrialist, founder of the 2500 crores
(USD500mn) Nirma groups with major interest in detergents, soap and
cosmetics.The firm has set up state-of-the-art packing and printing units and now
directly produces key raw materials to improve product quality. The company
has created Nirma consumer care Ltd. A owned subsidiary in August, which is
the sole license of the brand name Nirma within India.
GODREJ
Godrej group has its root in India’s Swadeshi movement. It is an Indian
conglomerate headquarter in Mumbai, Maharashtra, managed and owned largely
by the Godrej family. It was founded by Ardeshir Godrej and piroisha Burjorji
Godrej in 1897 Godrej is one of the most trusted brands with revenue of US$4.1,
and enjoys the patronage of 1.1 billion consumers globally across our consumer
goods, real estate and many other business. It operates in sectors as diversified
business which includes inside and outside India. The Godrej groups can be
broadly divided into two major holding companies working independently are
Godrej industries Ltd and Godrej & Boyce.
17
CHAPTER 4
Above table shows that the advertisement influence on buying decision is more.
Figure no.4.1
Yes No
42%
58%
It is clear from this graph that advertisement plays a role in influencing buying
decision of 58 percentages of people.
18
Table no.4.2
The above table shows that advertisement is effective in creating desire to purchase.
The response of people to recall is very low.
Figure no.4.2
16
14
12
10
8
6
4
2
0
Recall Positive Interest Desire to
impression purchase
This diagram reveals that about 32 percentage of people desire to purchase soap
by the effectiveness of advertisement. Some respondents have positive impression and
interest by seeing advertisement.
19
Table no.4.3
Radio 2 4
Television 34 68
News paper 11 22
Magazines 3 6
From the above table most of the respondents prefer television to see advertisement.
Comparing to other media, the impact of radio is very low
Figure no.4.3
35
30
25
20
Number of responds
15
10
0
Radio Television News paper Magazines
20
Table no.4.4
Few hours 14 28
One week 13 26
One day 5 10
Above table shows that advertisement effect last for more than a month on people
Figure no.4.4
18
16
14
12
10
8
6
4
2
0
Few One More One day
hours week than a
month
Number of responds 14 13 18 5
Above diagram shows that 68 percentage advertisement impact last for more
than a month and 10 percentage impacts last for one day.
21
Table no.4.5
Yes 32 64
No 18 36
From the table it is clear that shopping decision depend upon publicity of the
companies.
Figure no.4.5
No
36%
Yes
64%
From the diagram it shows that 64 percentage people make shopping depending
upon the publicity of the company.
22
Table no. 4.6
Vivel 10 20
Santoor 10 20
Lux 14 28
Godrej No.1 4 8
Nirma 6 12
Others 6 12
Above table states that Lux is the mostly preferred soap and least is Godrej
No.1.
Figure no.4.6
14
12
10
Number of responds
6
0
Vivel Santoor Lux Godrej Nirma Others
No.1
23
Table no.4.7
Quality 20 40
Smell 18 36
Price 5 10
Quantity 5 10
Others 2 4
Table states that quality and smell are the mostly choose reasons for preferring
the soap.
Figure no.4.7
Number of responds
20
15
10 Number of responds
0
Quality Smell Price Quantity Others
Above diagram states that 40 percentage people prefer soap because of quality,
36 percentages because of smell.
24
Table no.4.8
From the above table it is clear that the main purposes of seeing advertisement
is to know new varieties.
Figure no.4.8
Number of responds
25
20
15
10
Number of responds
5
0
Entertain Purchase New varieties Others
From the above table it is clear that 42 percentage see advertisement to know new
varieties, and least 8 percentage for entertainment.
25
Table no.4.9
(Amounts in billion)
Above table it is clear that sales, advertisement expenditure and operating profit
are increasing.
Figure no.4.9
400
350
300
250
Sales
200
Advertisement expenditure
150 Operating profit
100
50
0
2015-16 2016-17 2017-18 2018-19 2019-20
From the diagram it is clear that sales and operating profit shows growing trend,
advertisement expenditure shows a constant trend.
26
Table no.4.10
(Amount in billion)
Above table states that sales, advertisement expenditure and operating profit
shows a increasing trend.
Figure no.4.10
350
300
250
200 Sales
Advertisement expenditure
150
Operating profit
100
50
0
2015-16 2016-17 2017-18 2018-19 2019-20
Above diagram shows that sales have a rising trend, advertisement expenses and
operating profit shows a lower rising trend.
27
Table no.4.11
(Amount in bilions)
Above table states that sales, advertisement expenses and operating profit show
a growing trend
Figure no.4.11
450
400
350
300
250 Sales
100
50
0
2015-16 2016-17 2017-18 2018-19 2019-20
Above diagram states that sales show rising trend, advertisement expenses and
operating profit shows lower rising trend.
28
Table no.4.12
(Amount in billions)
From the table shows that sales, advertisement expenditure and operating profit
shows rising trend.
Figure no.4.12
16
14
12
10
Sales
8
Advertisement expenditure
6 Soperating profit
0
2015-16 2016-17 2017-18 2018-19 2019-20
Above diagram states that after a rising trend from 2012 onwards it show a
constant trend, advertising expenses have constant trend, operating profit show
fluctuating trend.
29
Table no.4.13
(Amount in billions)
Figure no.4.13
45
40
35
30
25 Sales
20 Advertisement expenditure
Operating profit
15
10
0
2015-16 2016-17 2017-18 2018-19 2019-20
Above diagram states that after a increase, from 2012 onwards sales is
decreasing, , advertisement expenditure and operating profit are fluctuating and have a
fall in 2012-2013.
30
Table no.4.14
(Amount in billions)
From the table it is clear that vivel,lux, santoor and godrej no.1 show an
increasing trend whereas nirma has a declining trend.
Figure no.4.14
450
400
350
300
vivel
250 Lux
200 Santoor
Godrej.No.1
150
Nirma
100
50
0
2015-16 2016-17 2017-18 2018-19 2019-20
From the table it is clear that vivel, lux and santoor has a rising trend, nirma and
godrej no.1 has a lower constant trend. Santoor is having more sales comparing with
others.
31
Table no.4.15
five years
(Amount in billions)
From the table it is clear that advertisement expenses of all companies are
increasing.
Figure no.4.15
120
100
80
vivel
Lux
60
Santoor
Godrej.No.1
40
Nirma
20
0
2015-16 2016-17 2017-18 2018-19 2019-20
From the table it is clear that vivel is having more expenses, godrej no.1 is
having least advertisement expenditure.
32
Tableno.4.16
(Amount in billions)
Above table shows that operating profit of all companies are increasing.
Figure no.4.16
160
140
120
100 Vivel
Lux
80
Santoor
60 Godrej.No.1
Nirma
40
20
0
2015-16 2016-17 2017-18 2018-19 2019-20
Above diagram shows that Vivel is having higher profit and is followed by
santoor, Godrej no.1 is having least profit
33
CHAPTER 5
34
Recommendations;
35
Conclusion:
The study examines the effectiveness of advertisement on sales turnover.
Advertisement makes the product, idea, services known to induce action in
accordance with the intent and purpose of the advertiser. it helps to increase the
sales turnover of the company. The study aims to analysis the trend of sales over
five years and to know the effect of advertisement on customer’s decision
making. cross-sectional data are records of advertising expenditure and sales for
a specific period over different market. time-series data are records of parts of
advertisement expenditure and sales over times. The financial data of five
companies over five years are analyses in the study. The study helps to find how
advertisement expenditure makes impact on profit of the company. Statistical
tool of correlation helps to find out the relation between sales and advertisement.
Graphs and tables represent the trend over five years. Primary data is collected
using questionnaire with fifty samples. Ads can be a cost-effective way to
disseminate messages, whether to build a brad preference or to educate people.
The advertisement budget is set in terms of a specified percentage of sale. The
study deals with an in-depth analysis of sales turnover, advertisement
expenditure and profit of the five companies. The objectives of the study are to
study the advertisement effectiveness on sales turnover. there is positive
correlation exists between advertisement and sales turn over. So from this brief
and precise study it is concluded that the effectiveness of advertisement has a
direct, positive and proportional relationship with the overall sales turnover of
the soap manufacturing company.
36
BIBLIOGRAPHY
BIBLIOGRAPHY
Yes No
Yes No
Yes No
d) Magazines
8. How often do you buy the same article as you see in ads?
Yes No
Yes No
12. Which of the following soap do you prefer for your daily bathing?
e) Nirma f) Others.
e) Others
14. Does the picture of celebrities? Brand ambassadors in the TV Ad, make you think
Yes No
Yes No
Yes No
18.Do ypu believe that information published through ads is enough to purchase a
product?
Yes No
19.Did you receive any gift coupon of any kind from the advertisement?
Yes No
Yes No