Setting Advertising Objectives

For one who has no objective, nothing is relevant.

- Confucius

Without objectives, it is nearly impossible to guide and control decision making. Good performance occurred in the absence of objectives can rarely be sustained. The challenge today is to bring effective management to the advertising process in such a way as to provide simulation as well as direction to the creative effort. The solution is the meaningful objective.

Advertising objectives, like organizational objectives, should be operational. They should be effective communication tools, providing a line between strategic and tactical decisions. A convenient and enticing advertising objective is immediate sales or market share.

However, an increase in immediate sales is not operational in many cases for two reasons:

(1) Advertising is one of many factors influencing sales, and it is difficult to isolate its contribution to sales. The other forces include price, distribution, packaging, product features, competitive actions, and changing buyer needs and tastes.

(2) The second reason involves the long-term effect of advertising on sales. If advertising generates a substantial lagged effect on sales, then the impact of an advertising campaign may not be known until an unacceptable length of time has passed. For example, an important contribution of a 6-month campaign might be its impact 12 months hence. If immediate sales of not the basis of operational objectives, how does to proceed? The answer to the following questions will yield useful and effective objectives.

1. Who is the target segment?
2. What is the ultimate behavior that advertising is attempting to precipitate, reinforce, change, or influence?
3. What is the process that will lead to the desired behavior and what role can advertising play in the process?
4. Is it necessary to create awareness, communicate information about the brand, create an image or attitude, or associate feelings or a type of user personality with a brand?

- Identify the target audience. The specification of the target audience should be a part of the marketing objectives.

- The analysis of the ultimate desired behavior such as trial purchases of new customers, maintenance of loyalty of excising customers, creation of a more positive use experience, reduction of time between purchases, or the decision to visit a retailer use experience, reduction of time between purchases, or the decision to visit a retailer.

- An analysis of the communication and decision process the will affect the desired behavior. It might be that the key variable in inducing a new customer to try your brand is to inculcate high levels of brand awareness. The best way to maintain loyalty is to strengthen an attitude. Which intervening variables provide the best link to the desired behavior and which can be influenced economically by advertising are to be determined.

An analysis of market dynamics can lead to behavioral measures that by themselves can provide the basis for operational objectives. If the advertising’s target is new customers, the goal may be to get new customers to try a brand for the first time. The results would be measured by the number of new customers attached.

The use of behavioral measure as objectives is often appropriate in retailing (store traffic measures), direct marketing, and sales promotion and in lead generation for salespeople. It is useful to analyze the communication and decision process relevant to the desired behavior and to identify intervening variables on which to base objectives. Some situations could dictate the joint use of intervening and behavioral objectives.

Selecting an Advertising Agency

While selecting an advertising agency, the importance of compatibility should be borne in mind. An agency takes a long time to grasp the problems and accumulate the facts that are necessary for the smooth functioning of a client. Though this investment period is long, it pays rich dividends. Therefore, an agency should not be frequently changed.

Here are some points that can help the advertiser to:

• Choose an agency ; and
• Get the best out of an agency.

 Choosing an Agency

• The agency should be able to think independently on various problems, and not solve them by pre-conceived notions which it is unwilling to change.
• The agency should have experience in selling goods and ideas. It should be able to bring in more results than anticipated.
• The company should be financially sound and should be able to cover both local and national advertising campaigns.
• The size of the agency should not be seriously taken into account. A big agency is not necessarily a better than a small agency.
• The agency should not be one that hesitates to correct the advertiser if it feels that he is wrong.
• The agency should be able to use both research and brains to solve problems.
• An agency that plans to make a profit on an account should be chosen, rather than one that maintains that it will work on a no-profit-no-loss basis.

Getting the Best Out of an Agency

• The agency should be given all possible information if good service is expected from it.
• The advertiser should go as far as possible to keep the agency on its toes.
• The agency should be challenged to produce results.
• Criticism, when it is handed out, should not be only unfavourable. It should also be favourable.
• Unnecessary details should not be fussed over.
• The advertiser should appoint a special person for liaison work between his company and the agency, and not expect the agency to contact the junior staff.
• The advertiser should allow the agency, where necessary, to break away from convention in its presentations.
• The agency should be paid extra, if it does any extra work.
• The advertiser should examine the work his agency does for other parties to get new ideas.

It is about time that the top management looked upon advertising as a basic capital investment –a long-term investment –which does not necessarily always bring in immediate returns. The management should realize that advertising has two functions to perform. It has to sell products today and sell the name of the company, so that tomorrow’s products, too, will sell.

Advertising Industry

The advertising industry consists of three principal groups:

(a) Sponsors;

(b) Media; and

(c) Advertising agencies or advertising departments.

Advertising agencies are of two basic types, viz., Independent; and House.

• An independent agency is a business that is free to compete for and select its clients.

• A house agency is owned by its major client. A house agency is not completely free to serve other clients. The advertising department an integral part of the organization it serves.

The advertising agency provides for the client a minimum of:

• Media information, such as the availability of time and space ;
• Creative skills, such as “campaign planning” and “appeal planning” and
• Research capabilities, such as providing brand preference data.

What is an Advertising Agency?

An advertising agency is an independent organization set up to render specialized services in advertising in particular and in marketing in general. Advertising agencies started as space brokers for the handling of the advertisements placed in newspapers. Over the years, the function of the agencies has changed. Their main job today is not to aid media but to serve advertisers.

Working with Advertising Agency

Some organization does not employ advertising agencies because they may be eligible for the media discount. Others feel that they can accomplish the advertising objectives more effectively than the agencies themselves. These marketers often employ their own advertising specialists. Various organizations use captive agencies that work primarily or solely for the organization.

Those organizations which do employ agencies are well-advised to establish a strong working relationship with them. It is especially important that the marketer fully inform the agency personnel of his marketing strategy and advertising objectives.

Advantage of Using Agencies

1. The marketer gains a number of benefits by employing agencies. An agency generally has an invaluable experience in dealing with various advertising and marketing issues.
2. The lessons which agency learned in working with other clients are useful inputs for the marketer.
3. An agency may employ specialists in the various areas of preparation and implementation of advertising plans and strategies.
4. The personnel are not members of the marketer’s management team. They bring objective and unbiased viewpoints to the solution of advertising and other marketing problems.
5. The discounts that the media offer to agencies are also available to advertisers. This is a strong stimulus to them to use an agency, for the media cost is not much affected thereby.
6. The company normally does not have as many types of specialists as a large or medium-sized advertising agency has because an agency can spread the costs or its staff over many clients. It can do more for the same amount of money.
7. The company can also get an objective, outside viewpoint from an agency, assuming that the agency representatives are not acting as “Yes man” in order to keep the advertiser’s account.
8. A related point is that the company can benefit from the agency’s experience with many other products and clients.
9. Another advantage is that agency feels a greater pressure than the company’s own department to produce effective results. The relations between an agency and a client are very easy to terminate; but it is difficult to get rid of an ineffective advertising department.
10. The manner in which agencies are compensated, the use of an agency may not cost the advertiser a single paisa.

ENTREPRENEUR AND ENTREPRENEURSHIP

NO	ENTREPRENEUR	ENTREPRENEURSHIP
1	Refers to a person	Refers to a process
2	Is a visualiser	Is a vision
3	Is a creator	Is a creation
4	Is an organizer	Is an organization
5	Is an innovator	Is an innovation
6	Is a technician	Is a technology
7	Is an initiator	Is an initiative
8	Is a decision- maker	Involves decision making
9	Is a planner	Involves planning
10	Is a leader	Involves leadership

DIFFERENCE BETWEEN ENTREPRENEUR & MANAGER

No.	ENTERPRENEUR	MANAGER
1	The main motive of an entrepreneur is to start a venture by setting up an enterprise. He understands the venture for his personal gratification.	The main motive of a manager is to render his services in an enterprise already set up by someone else.
2	An entrepreneur is the owner of the enterprise.	A manger is the servant in the enterprise owned by the entrepreneur.
3	An entrepreneur being the owner of the enterprise assumes all risk and uncertainty involved in running the enterprise.	A manger is a servant does not bear any risk involved in the enterprise.
4	The reward an entrepreneur gets for baring risks involved in the enterprise is profit which is highly uncertain.	A manger gets salary for the services rendered by him in the enterprise.
5	Entrepreneur himself thinks over what and how to produce goods to meet the changing demands of the customers. Hence, he acts as an innovator also called as a change agent.	A manager simply executes the plan prepared by the entrepreneur. Thus, a manger simply translates the entrepreneur’s ideas into practice.
6	An entrepreneur needs to possess qualities and qualification like high achievement motive, originality in thinking, foresight, risk bearing, ability and soon.	On the contrary a manger needs to possess distinct qualifications in terms of sound knowledge in management, theory and practice.

QUALITIES OF ENTREPRENEURSHIP

The qualities that contribute to the success of an entrepreneur are as follows: -

1. Risk Taking: - Entrepreneurs are moderate risk takers. They enjoy he excitement of a challenge, but they do not gamble. Entrepreneurs avoid low- risk situations because there is a lack of challenge. They avoid high risk situations because they want to succeed. They like achievable challenges. They do not tend to like situations where the outcome of a quest depends upon a chance and not on their efforts. They like to influence the outcome of their quest by putting in more efforts and then experiencing a sense of accomplishment.

A risk situation occurs when an entrepreneur is required to make a choice between two or more alternatives whose potential outcomes are not known and must be evaluated in advance, with limited information. A risk situation involves potential gain and potential loss. As the size of the business expands the problems and opportunities become more numerous and complex. Business growth and development require an entrepreneur not to be afraid of taking decisions and certain risks. Most people are afraid to take risks because they want to be safe and avoid failure. An entrepreneur always takes a calculated risk and is not afraid of failure.

2. Self- Confidence: - A man with self – confidence has clear thoughts and well- defined goals to achieve in his life. An entrepreneur gets into business or industry with a high level of self- confidence. He is able to evaluate his competencies and capabilities in a realistic manner. He can set realistic and challenging goals. He is confident of achieving these goals. He possesses a sense of effectiveness, which ultimately contributes to success of his venture. He puts forward his case confidently and gets needed help from concerned agencies/ authorities.

3. Optimist: - An entrepreneur is able to visualize the hidden opportunities in the environment and translate them into business realities. An entrepreneur exhibits a positive and optimistic attitude towards such opportunities. The entrepreneur approaches his task with the hope of success and not with a fear of failure. In the process of accomplishing his task he may also fail but the failure experience does not change his thinking. He is always an optimist in his outlook. The positive outlook develops a drive in the entrepreneur to attempt new things and innovate.

4. Need for achievement: - The need to excel known as achievement is a critical factor in the personality of an entrepreneur. People with high need for achievement have desire for success in competition with others or with a self- imposed standard of excellence. They try to accomplish something new and try to innovate themselves in longterm goals. They try to accomplish challenging tasks. They know their own strengths and weaknesses, the facilitating factors and constraints in the environment and the resources needed to accomplish their tasks. If the objectives are accomplished they feel elated.

5. Need for independence: - The need for independence is the prime characteristic that has driven the entrepreneurs to start their own business. These entrepreneurs do not like to be controlled by others. They do not wait for direction from others and choose their own course of action. They set their own challenging goals and put efforts to achieve this goal. The independence provides opportunity for trying out new ideas and helps them achieve their goals.

6. Creativity: - Entrepreneurs are highly creative people. They always try to develop new products, processes or markets. They are innovative, flexible and are willing to adopt changes. They are not satisfied with conventional and routine way of doing things. They involve themselves in finding new ways of doing the things for the better.

7. Imaginative: - Successful entrepreneurs possess a high degree of imagination and foresightedness. Entrepreneurs have a great vision. Knowing the present and the past the entrepreneur is able to predict the future events the business more accurately than others. It is because of their visionary nature and power of imagination that helps them in anticipating problems and evolving actions strategies for such problems.

8. Administrative ability: - A successful entrepreneur is always a good administrator. He knows the art of getting things done by other people without hurting their feelings of self- respect. He has strong motivation towards the achievement of a task and puts in necessary efforts in getting things done by others.

9. Communication ability: - Communication ability is the ability to communicate effectively. Good communications also means that both the sender and the receiver understand each other and are being understood. An entrepreneur who can effectively communicate with customers, employees, suppliers and bankers will always succeed in their business.

10. Clear objectives: - An entrepreneur has clear objectives as to the exact nature of the business, the nature of the goods to be produced and the subsidiary activities to be undertaken. A successful entrepreneur has the objective to establish the product to make profit or to render social service.

11. Business Secrecy: - An entrepreneur who is successful always guards his business secrets. Leakage of business secrets to trade competitors is a serious matter; therefore an entrepreneur should carefully guard it. An entrepreneur must be able to make a proper selection of his assistant since most of the time it is the assistant who leaks the trade secret.

12. Emotional stability: - The most important personality factors contributing to the success of an entrepreneur are emotional stability, personal relations, consideration and tactfulness. An entrepreneur must maintain good relations with the customers if he wishes to enjoy their continued patronage. He must also maintain good relation with his employees, whom he shall motivate to perform their jobs at a high level of efficiency. An entrepreneur who maintains good human relations with customers, employees, suppliers and the community has a better chance to succeed in his/ her business.

13. Open-mindedness: - Open- mindedness means a free and frank approach in accepting one’s own errors and change for the better. An  entrepreneur must be willing to learn from his past experience, mistakes and moulds himself for better.

14. Technical knowledge: - Technical knowledge implies knowledge about the product, process or technology used in manufacturing. An entrepreneur who has reasonable level of technical knowledge will always be successful. Technical knowledge is easy to acquire if the entrepreneur tries hard to acquire it.

15. Patience: - Patience means ability to wait. Patience also means doing the work and waiting for the result. A certain amount of patience is necessary in any type of vocation. An entrepreneur should not wait for actions but can certainly wait for result for his efforts.

16. Hard working and energetic: - Ability and willingness to work hard is an important quality of an entrepreneur. A person having physical and mental stamina to cope with the hard work and human relation is fit to become a successful entrepreneur. By carrying out well- planned and systematic work, success is always the end result.

17. Good organizer: - Entrepreneurs are good organizers of resources like men, machines, materials and money needed to start and run the business smoothly. They can convince the employees, investors, customers and co- ordinate the activities of individuals and groups in the accomplishment of business objectives. An entrepreneur works like a coordinating force among the resources, mould and manages them effectively.

STAGES OF EVOLUTION OF ENTREPRENEURSHIP

The evolutionary process of entrepreneurship activities may be divided into the following broad stages:

1. Hunting Stage: - The primary stage of the evolution of the economic life of man was hunting stage. Wants were limited and very few in numbers. The family members themselves satisfied problems of food, clothing and shelter. Producers were the consumers also. Robinson Crusoe, living in the deserted island, satisfying his own requirements had no knowledge of business. People in some parts of Africa and India still lead this type of life. In this stage problems of production and distribution were not complexed since wants were simple and limited.

2. Pastoral Stage: - With the progress of mankind gradually mental understanding developed and people started realizing that instead of killing animals, they should breed and rear them. Thus cattle breeding encouraged the use of milk, and they had to think in terms of grazing areas for their cattle. The surplus milk, meat and other related products were spared of exchange. This stage can be termed as the first stage of economic development and the beginning of commerce.

3. Agricultural Stage: - In search of grazing areas, they further realized that they should grow plants as food for animals. They started testing some grain products and slowly developed a taste in plants and the land was used for cultivation. Groups of persons started living together on their agricultural fields, which were subsequently converted into small villages with their farms. Free exchange of goods was started and the activities were also divided to the extent of division of labor at the village level to complement the needs of each other. Initially each village was self sufficient, but later they began small trading activities on barter basis.

4. Handicraft Stage: - In the agricultural stage, people started learning the use of cloth made of cotton products, and they developed the segments of the workers for different activities. Cottage scale setup was developed at the village level to nearby villages, and in exchange they brought requirements either to consume themselves or for their village friends. Since the demand for gold coins, silver coins, skin and hide etc increased the activities of cobblers, gold smiths, and blacksmiths, laborers also rapidly increased, and caste system was also formed on the basis of activities they did. Everybody selected their job according to their own choice and taste.

5. Present Industrial Stage: - The use of mechanical devices and the commonly acceptable form of monetary system accelerated the growth of entrepreneurship activities. The progress of science and the increase in the means of transportation and communication enabled to travel widely and the markets were developed in the country and abroad.