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REVIEW OF LITERATURE INTRODUCTION In a time when customers are exposed daily to a nearly infinite amount of promotional messages, many marketers are discovering that advertising alone is not enough to move members of a target market to take action, such as getting them to try a new product. Instead, marketers have learned that to meet their goals they must use additional promotional methods in conjunction with advertising. Other marketers have found that certain characteristics of their target market (e.g., small but geographically dispersed) or characteristics of their product (e.g., highly complex) make advertising a less attractive option. For these marketers better results may be obtained using other promotional approaches and may lead to directing all their promotional spending to non-advertising promotions. Finally, the high cost of advertising may drive many to seek alternative, lower cost promotional techniques to meet their promotion goals. Sales promotions are used widely in many industries and especially by marketers selling to consumers. We will see that the objectives of sales promotion are quite different than advertising and are specifically designed to encourage customer response. DEFINITION An activity designed to boost the sales of a product or service. It may include an advertising campaign, increased PR activity, a free-sample campaign, offering free gifts or trading stamps, arranging demonstrations or exhibitions, setting up competitions with attractive prizes, temporary price reductions, door-to-door calling, telemarketing, personal letters on other methods". Promotion is part of marketing which can be considered as one of the youngest disciplines in the business world and is driven by innovation (Sutheralnd and Canwell, 2004). Within it, marketing communications, or promotion, is a management process through which an organization engages with its various audiences. Through understanding and audiences communications environment, organizations seek to develop and present messages for their identified stakeholder groups, before evaluating and acting upon the responses received. By conveying messages that are of significant value, audiences are encouraged to offer attitudinal and behavioral responses (Fill, 2005). Generally, promotion is used by organisations to communicate with customers with respect to their product offerings. In this sense, promotion is one side of the communication process with customers (Rowley, 1998). These days people and customers are exposed to radio on FM, medium wave and long wave, three national commercial stations and some 180+ regional and local commercial radio stations. There are over 3500 magazines covering every imaginable interest. There is a wide range of outdoor media, not just fixed poster sites, but posters on the sides of buses and taxi cabs, on the underground and at railway stations, not to mention that many people have become walking advertisements for the brands they wear, with cloths bearing logos for all to see. In this array of confusion, marketing communications increasingly represents the single most important opportunity for companies to convince
potential consumer of the superiority of their products and services (Yeshin, 1998). Another important factor for marketers is speed of information access, especially in todays rushed world, in which the growth of information technology is fast. Not only information can be processed more rapidly but it also mean that access to that information can be made far more promptly than at any time in the...
fraternity to splurge on value added and lifestyle products. The increasing salaries, along with rising trend of perks in the corporate sector at regular intervals, have increased peoples spending power. As per some research, there is a high correlation between Disposable per capita and HPC per capita. 2. Organized Retail: The emergence of organized retail have lead to more variety with ease in browsing, opportunity to compare with different products in a category, one stop destination (entertainment, food and shopping) etc, which is playing an important role in bringing boom in the Indian FMCG market. Currently the modern trade is capturing 5% of the total retail space, which will increase to 10% and 25% in 2010 and 2025 respectively. Also, as the credit card and organized retail trend picks up, people wont think much while buying and buy more. 3. Distribution Depth - Rural Penetration: There are 5500 towns and 6.38 Lacs villages with 2.5Mln and 5Mln outlets respectively. Due to saturation and cut throat competition in urban India, many FMCG companies are devising strategies for targeting rural consumers in a big way. Many FMCG companies are focusing on increasing their distribution network to penetrate with a step by step plan. This is the reason that FMCG urban market size has dropped from 50% to 29% in last 5 years....