Attempt all the questions.
Section-A
Question1) Unlike Sales Promotions - Advertising is a form of market communication aimed at promoting awareness and achieving long term Marketing Objectives? Examine this statement and give examples.
Question2) Differentiate between Traditional Mass Media and today’s contemporary Media? Briefly summarize the criteria behind media choice and selection for running an advertising campaign?
Question3) Explain the following models of advertising and describe how they differ from one another:
(a) Hierarchy of Effects Model
(b) AIDAS Model of Advertising
(c) DAGMAR Approach
Question4)(a) Explain briefly the objectives and functions of advertising?
(b) What are the different ways in which advertisements could be classified?
Section-B
Case Study:
SMS Advertising - A New Media Mix Tool
SMS - A New Concept
By early 21st century, cellular telephony revolution had radically transformed the global telecommunications industry. Cellular phones offered a whole new experience to people desirous of keeping in touch with their close ones anytime, anywhere. Cell phones (or mobile phones) became more popular, largely due to the emergence of Short Messaging Service (SMS). Popularity of SMS took even industry experts by surprise, as service had always been looked down upon as a 'low-end' option offered by a cell phone. As per the findings of a study conducted about the usage of SMS across 14 countries, over 80% of cell phone users in countries like Finland, the UK and many European countries used SMS at least once a month
In Sweden, Singapore, Italy and Germany, around 75% of people used SMS at least once a month. SMS was most popular in the 'under 25 years' age group. Text messages sent across the world reached the astounding 62.45 billion per month by December 2002. According to estimates of Strand Consult1, global market for SMS doubled from $ US 7.5 billion in July 2000 to $ US 15 billion by December 2001, and was still growing at a scorching pace.
Firm expected revenues from SMS advertising to exceed those from Internet advertising in near future. Considering this huge pool of mobile-savvy customers, marketers cannot ignore the potential which advertisements directed towards SMS senders had. Therefore, was born the concept of SMS advertising - something that was to influence the media mix plans of many companies in the years to come.
Background Note
Basic concept of cellular phones originated in 1947 in the US, when researchers at Bell Laboratories got an idea of cellular communications from mobile car phone technology used by police department of the country. Though, it took over three decades for the first cellular communication system to evolve.
The public trials of the first cellular system began in Chicago during late 1970s and the first commercial cellular telephone system was launched in Tokyo. Cellular telephone services were introduced in the US in the early 1980s, and became popular within the short span of time.
By the late 1980s, cellular services were operational in many developed countries across the world. Over the years, there was the improvement in both the number and quality of services offered on account of dynamic technological advancements. There were mainly two types of cellular services offered by operators - post-paid and pre-paid.
Post paid cellular services, also called billing card services, required the customers to pay for the cellular services utilized by them at the end of a specific period (generally every month). These services also included fixed rental charges for the services provided. Pre-paid cellular services required customers to pay in advance for the services they will be using.
These cards were available in different denominations, and customer can choose one, keeping in mind his/her call requirements and budget. When customers exhausted call time they were entitled to, services were withdrawn. To attract and retain their customers, cellular companies offered a host of other services like voice mailing, chatting, Internet browsing, roaming services, call wait/hold/divert options and games. Customers can also download ring tones and logos, and receive information (horoscopes, game scores, traffic updates and weather news among others). Subscribers usually had to pay for all the above services depending on the service provider's tariff plans.
Many of the services were priced on higher side. SMS, though, was a service that was generally priced low, and in a few cases, offered free of charge as well. Simply put, SMS is a single, short message, up to 160 characters (word, numerals, alpha-numeric, or images) which could be sent from one cell phone to another...
Exploring SMS Advertising Tool
Realizing benefits SMS advertising can offer, several companies like Pepsi, Sony, Cadbury Schweppes, Coca-Cola, Heineken and Johnson & Johnson tried advertising their products through this medium.
SMS Advertising - The Future
Marketing company based in US, The Mobile Channel, conducted the survey of 1000 people regarding acceptance of SMS advertising. Approximately 94% of users were positive about choice of advertisements sent and showed that text advertising can elicit a product response of up to 28%. Even as corporate and cell phone users seemed to be rather enthusiastic about growing popularity of SMS advertising, there were a few criticisms as well.
Like many other media mix components, SMS advertising too had several pitfalls associated with its usage - primary being that of 'Spam SMS' (similar to spam e-mails, spam SMS refers to unsolicited, unwanted junk SMS that land up in a cell phone user's inbox). Commenting on this, industry observer said, "Some unscrupulous firms are bound to start sending out spam and clogging vastly bigger inbox of your futuristic phone with messages which you don’t want about services or offers you don’t need."...
Question5) Discussion Questions:
a) Identify reasons behind growing popularity of SMS?
b) Examine factors responsible for its emergence as a media mix tool”
c) Do you perceive that SMS advertising option is efficient and has a good future for promoting items belonging to certain categories of industries?