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Module-II

Chapter – 01
Communication & Its Process
Communication is a process of exchanging verbal and non verbal messages. It is a continuous
process. Pre-requisite of communication is a message. This message must be conveyed through some
medium to the recipient. It is essential that this message must be understood by the recipient in same
terms as intended by the sender. He must respond within a time frame. Thus, communication is a two
way process and is incomplete without a feedback from the recipient to the sender on how well the
message is understood by him.
Communication may be defined as a process concerning exchange of facts or ideas between persons
holding different positions in an organisation to achieve mutual harmony. The communication
process is dynamic in nature rather than a static phenomenon.

Communication Process
The main components of communication process are as follows:
1. Context - This is the subject matter of the communication. This may be an opinion, attitude,
feelings, views, orders, or suggestions. Communication is affected by the context in which it
takes place. This context may be physical, social, chronological or cultural. Every
communication proceeds with context. The sender chooses the message to communicate
within a context.
2. Sender / Encoder - Sender / Encoder is a person who sends the message. A sender makes use
of symbols (words or graphic or visual aids) to convey the message and produce the required
response. The person who intends to convey the message with the intention of passing
information and ideas to others is known as sender or communicator. For instance - a training
manager conducting training for new batch of employees. Sender may be an individual or a
group or an organization. The views, background, approach, skills, competencies, and
knowledge of the sender have a great impact on the message. The verbal and non verbal

Dr. Meghashree A. Dadhich


symbols chosen are essential in ascertaining interpretation of the message by the recipient in
the same terms as intended by the sender.
3. Message - Message is a key idea that the sender wants to communicate. It is a sign that elicits
the response of recipient. Communication process begins with deciding about the message to
be conveyed. It must be ensured that the main objective of the message is clear.
4. Encoding - Since the subject matter of communication is theoretical and intangible, its
further passing requires use of certain symbols such as words, actions or pictures etc.
Conversion of subject matter into these symbols is the process of encoding.
5. Medium - Medium is a means used to exchange / transmit the message. The sender must
choose an appropriate medium for transmitting the message else the message might not be
conveyed to the desired recipients. The choice of appropriate medium of communication is
essential for making the message effective and correctly interpreted by the recipient. This
choice of communication medium varies depending upon the features of communication. For
instance - Written medium is chosen when a message has to be conveyed to a small group of
people, while an oral medium is chosen when spontaneous feedback is required from the
recipient as misunderstandings are cleared then and there.
6. Recipient / Decoder - Recipient / Decoder is a person for whom the message is intended /
aimed / targeted. It is the receiver who tries to understand the message in the best possible
manner in achieving the desired objectives. The degree to which the decoder understands the
message is dependent upon various factors such as knowledge of recipient, their
responsiveness to the message, and the reliance of encoder on decoder.
7. Decoding: The person who receives the message or symbol from the communicator tries to
convert the same in such a way so that he may extract its meaning to his complete
understanding.
8. Feedback - Feedback is the process of ensuring that the receiver has received the message
and understood in the same sense as sender meant it. Feedback is the main component of
communication process as it permits the sender to analyze the efficacy of the message. It
helps the sender in confirming the correct interpretation of message by the decoder. Feedback
may be verbal (through words) or non-verbal (in form of smiles, sighs, etc.). It may take
written form also in form of memos, reports, etc.
Communication is thus a process by which meaning is assigned and conveyed in an attempt to create
shared understanding. This process, which requires a vast repertoire of skills
in interpersonal processing, listening, observing, speaking, questioning, analyzing, gestures, and
evaluating, enables collaboration and cooperation.

Dr. Meghashree A. Dadhich


Importance of Effective Communication in an Organisation
Effective communication is a basic prerequisite for the attainment of organisational goals. No
organisation, no group can exist without communication. Co-ordination of work is impossible and the
organisation will collapse for lack of communication. Co-operation also becomes impossible because
people cannot communicate their needs and feelings to others.
Every act of communication influences the organisation in some way or other. It is a thread that holds
the various interdependent parts of an organisation together. When it stops, organisation activity
ceases to exist. An idea, however great it is, is useless until it is transmitted and understood by others.
When communication is effective, it tends to encourage better performance and job satisfaction.
People understand their jobs better and feel more involved in them.
It is through effective communication that an executive ultimately gets work done by others.
Therefore, a successful executive must know the art of communication. Moreover, communication is
a means whereby the employee can be properly motivated to execute company plans enthusiastically.
It is the means by which behaviour is modified, change is effected and goals are achieved.
The first executive function is to develop and maintain a system of effective communication-the tool
for understanding. It is commonly said that what nerves are to human organism, communications are
to an industrial system.
Since management has been described as getting works done by people, it is necessary to
communicate what the management wishes to accomplish by the various tasks which the organisation
has undertaken. Communication is also an intra-management problem. It is the force that binds the
people of an organisation together. Through communication they can attain a common viewpoint and
understanding and co-operate to accomplish organisational objectives.
Good communication presupposes a two-way flow of information from the top down and from the
bottom up. It can be compared to a mighty river on the banks of which business life is built. All
social interactions involve communication. In organisation communication is a two-way traffic
whereby objectives, orders and policies are transmitted downward and desires and dissatisfactions are
transmitted upward.
A successful executive should have the ability to receive, analyse and transmit information in
motivating his subordinates in the right direction. Thus effective communication is a skill of
management.
Communication is the link between knowledge and information. Possession of knowledge is of no
use until it is converted into information. Hence, knowledge alone is not adequate for managerial
success; what is required is knowledge plus ability to communicate accurately. The popular saying
‘knowledge is power’ should be modified to ‘applied knowledge is power.’ And to apply, it requires
effective communication.

Dr. Meghashree A. Dadhich


In organisation communication transmits orders for work, aids in doing the work, buying raw
materials and in advertising and selling the product. It is the means used to hire, fire, promote, praise,
urge, censure, persuade and so on. Bad communication is often the root cause of many problems.
Secrecy breeds rumours and a hush-hush attitude breeds harmful rumours.
As far as possible, management should supply all relevant information to employees. The employees
of an organisation have great curiosity to know what the company is going to do with, say computers
or bonus or DAs. If the management does not provide information, the employees will concoct
information through grape vine rumours which may have damaging results for the company. In order
to avoid such problems, it is the duty of the management to supply all the relevant information
through appropriate media at the right time.
The importance of good communication can be featured as follows:
 Good communication is an essential tool in achieving productivity and maintaining strong
working relationships at all levels of an organisation.
 Employers who invest time and energy into delivering clear lines of communication will rapidly
build up levels of trust amongst employees, leading to increases in productivity, output and
morale in general.
 Communication plays a major role in dealing with employer employee relation problems,
employee productivity, in short, with all human relations matters.
 Poor communication in the workplace will inevitably lead to unmotivated staff that may begin to
question their own confidence in their abilities and inevitably in the organisation.
Essential Commandments of Good Communication
1. Clarify Ideas before Communicating: Managers need to deliver clear, achievable goals to both
teams and individuals, outlining exactly what is required on any given project, and ensuring that
all staff is aware of the objectives of the project, the department and the organisation as a whole.
2. Examine the true purpose of Communication: Ensure that message is clear and accessible to
the intended audience. To do this it is essential that manage has to determine what he or she
really wants to accomplish with the message.
3. Take the entire environment into Consideration: The physical setting, the social climate and
past communication practices should be examined in adapting the message to the environment.
4. Obtain valuable Advice from Experts: Consulting with the experts can be a useful method of
obtaining additional insights regarding how to handle the communication. It will improve the
quality of the message as well as reduces the time of convincing the audience.
5. Beware of the Overtones: The listeners will be affected by not only what is said but also how it
is said. Voice, tone, facial expression and choice of language influences the listeners’’ reaction to
the communiqué. Effective communicators know the importance of utilizing non-verbal
communication when delivering a message. It is a critical vehicle for capturing attention and
Dr. Meghashree A. Dadhich
communicating. Non-verbal communication includes eye contact, posture, gestures, voice and
tone quality and helps ensure that your audience receives your message effectively.
6. Convey Useful Information: People remember things that are beneficial to them. If the
manager wants that his subordinates must read the message, he should frame it short and sweet.
So that readers / listeners / target audiences’ interest will create and communication process ends
with the mutually benefits.
7. Follow up on Communication: The manager must solicit feedback in ascertaining whether the
subordinates understand the communiqué and then he needs to take an appropriate corrective
action at right time. Ensure that lines of communication are kept open at all times. Actively seek
and encourage progress reports and project updates. This is particularly important when dealing
with remote staff.
8. Communicate with the future as well as present goals: Most communications are designed to
meet the demands of the current situations. However, effective communication requires the
relevance or summarization of long term goal in favour to receive positive response from
maximum listeners.
9. Support Words with Deeds: If manager is contradict themselves by saying one thing and doing
another thing then he cannot influence to other to accept the notice. For example: a manger who
issued a notice reminding everyone to report at 8:30am from tomorrow onwards and if he
continuously coming at 9:00am then nobody will follow his directions.
10. Listen and Show Empathy – Communication is a two way process and no company or
individual will survive long if it doesn’t listen and encourage dialogue with the other party.
Listening shows respect and allows you to learn of any outstanding issues you may need to
address as an employer.
Seven C’s of Communication
1. Credibility: The term commonly used to imply a communicator's positive characteristics that
affect the receiver's acceptance of a message. Credibility refers to the objective and
subjective components of the believability of a source or message. Traditionally,
modern, credibility has two key components: trustworthiness and expertise, which both have
objective and subjective components. Credibility refers to the perception that a speaker is
knowledgeable, believable, and trustworthy. Credibility helps to determine the success of
a speech and establish the respect and acceptance the audience shows the speaker.
2. Context: Context is the circumstances surrounding a message. The circumstances might include
the setting, the value positions of the people, and appropriateness of a message. This means
considering your audience, the forum under which you are speaking, the era, and accepted
norms. For a Satanist to preach at a Christian church would be out of context. In other words, it
refers to the environment in which human communication takes place.

Dr. Meghashree A. Dadhich


3. Content: Content is the information and experience(s) directed towards an end-user or
audience. Content is "something that is to be expressed through some medium, as speech, writing
or any of various arts". Content is both information and communication: the sum total of the
freshness, readability, relevancy, and usefulness of the information presented, and the manner in
which it is presented.
4. Clarity: Clarity demands the use of simple language and easy sentence structure in composing
the message. When there is clarity in presenting ideas, it’s easy for the receiver/decoder to grasp
the meaning being conveyed by the sender/encoder. Clarity is the key to successful
communication, helping to accurately convey brand messages. Clarity helps to accurately convey
messages, making it the perfect filter for evaluating marketing communications.
5. Continuity: Continuity is a link from one thing to another. Whether continuity is applied in
writing or speaking, if it does not exist, then readers, listeners, viewers are at a loss. Continuity
provides readers, listeners and viewers, with clear, consistent communication in learning,
understanding, and observing functionality. Continuity within technical material involves content
(including diagrams, images, chapters, explanations, and/or examples) containing a logical,
understandable flow of text. Every element has to follow meaningfully from the previous
element. Sentences should be complete and make sense. All thoughts and information within
each sentence should follow clearly from one to the next. If continuity within explanations,
proposals, or objectives is not clear, then misunderstandings and wrong interpretations can occur
within any environment (business, manufacturing, pharmaceutical, etc.).
6. Channels: A communication channel is a particular type of media through which a message is
sent and received. In other words, Communication channels refer to the way this information
flows within the organization. There are many different types of communication channels
available for managers to use. Some of the possibilities are mobile technology, electronic bulletin
boards, fax machines and video conferencing. As organizations grow, managers cannot rely on
face-to-face communication alone to get their message across. A challenge that managers face
today is to determine what type of communication channel to use in order to carry out effective
communication. The types of communication channels are grouped into three main groups:
formal, informal and unofficial.
7. Capability: Connecting with a single person in a way that is tailored to that individual’s needs
and wants is a virtue that will never go out of style. Communication must take into account the
capability of the audience. Communication is most effective when they require the least effort on
the part of the recipient. This includes factors of availability, reading ability, reading habit and
receiver’s knowledge.
The Five Stages of Communication Adoption by Receiver

Dr. Meghashree A. Dadhich


Getting people to act on a message is not a simple process. In fact, research shows that it can be a
somewhat lengthy and complex procedure that depends on a number of intervening influences. One
key to understand how people accept new ideas or products is to analyze the adoption process. The
five stages are summarized as follows:
1. Awareness: A person becomes aware of an idea or a new product, often by means of an
advertisement or a new story.
2. Interest: The individual seeks more information about the ideas or the product through
brochures, pamphlets, reading in-depth articles in a newspaper or magazines.
3. Evaluation: The person evaluates the idea or the product on the basis of how it meets his
specific needs and wants. Getting feedback from friends and family is a part of this process.
4. Trial: The person tries the product or the idea on an experimental basis by using a sample,
witnessing a demonstration or collecting information from valued users of the product.
5. Adoption: The individual starts to use the product on a regular basis or integrates the idea into
his or her belief system.
The essential basis of all public relation work is the communication process. Communication is the
transfer of information from one person to another or more recently, to an apparatus which stores or
process new. The message can be transmitted by speech or written word or by images or a
combination of these or other media such as music, colour, mimicry, design or sense of touch. For
satisfactory information in certain fields the following points must be observed:
 The volume of information must be adequate.
 The density or frequency of the information must be in accordance with practical experience.
 The information must be up-to-date; it must be presented without unnecessary delay.
 The information must be aimed at the proper direction and must make use of the proper media to
reach the sector or the public for which it is intended.

Chapter – 02

Dr. Meghashree A. Dadhich


New Technologies in PR: Internet & Web
Digital devices of all kinds enable the more advanced and ambitious practitioners to stay on top of
the latest events in the external communication environment. And new technologies provide more
precise and instantaneous delivery of messages. According to the Middleberg Ross Survey of
journalists nationwide, the internet is a rapidly growing in favour to receiving news release, stories,
ideas and even audio & photo files from public relations sources.
Internet
Internet is created in the late 1960’s by researchers who were seeking a way to link computers with
other cities; the internet was initially an academic-government tool. It came into public use in the
early 1990’s; developed by America. In recent years, the Internet has evolved into a communication
network that many individuals have come to rely on. Although most users of the Internet use it for e-
mail, there are some professions that are strictly dedicated to the Internet. Web designers and
Webmasters are just two examples. However, professional use of the Internet is not just limited to
those whose livelihood depends on the Net, but many different types of professionals. The Internet is
used as a promotional, advertising, educational, profitable, informational and entertainment tool just
to name a few. As technology advances, so does the capability of the Net and its users are taking
advantage of it. Public Relations practitioners have turned to the use of the Internet in great
proportions over the past several years since the Internet boom. The Net has become one of the most
powerful public relations tools available. Many companies use the Internet to publish their press
releases, introduce new promotions and provide promotional support. Online public relations can be
used as a supplementary or main mode of communication to reach target audiences. It has been said
by many professionals that a company will not survive without a link to the online world and without
good public relations the link to the online world will not survive. The Internet allows a company to
directly communicate with audiences from all over the world at the click of a mouse. It is cheap and
it is fast. Companies love it. Consumers love it. PR practitioners love it.
Internet was based on the idea that there would be multiple independent networks. The Internet has
revolutionized the computer and communications world like nothing before. The invention of the
telegraph, telephone, radio, and computer set the stage for this unprecedented integration of
capabilities. The Internet is at once a world-wide broadcasting capability, a mechanism for
information dissemination, and a medium for collaboration and interaction between individuals and
their computers without regard for geographic location. The Internet represents one of the most
successful examples of the benefits of sustained investment and commitment to research and
development of information infrastructure. Beginning with the early research in packet switching, the
government, industry and academia have been partners in evolving and deploying this exciting new
technology. The Internet today is a widespread information infrastructure, the initial prototype of
what is often called the National or Global Information Infrastructure. Its history is complex and
Dr. Meghashree A. Dadhich
involves many aspects - technological, organizational, and community. And its influence reaches not
only to the technical fields of computer communications but throughout society as we move toward
increasing use of online tools to accomplish electronic commerce, information acquisition, and
community operations.
Online promotion is a necessity for almost any business these days. If you have a new business, or
one with a low advertising budget, navigating the many options available to you can be daunting,
especially when you are also concentrating on other day-to-day business needs. However, major
search engines, social media, and advertising services have made it easy to promote the business
online.
1st Method: WEBSITE
Create a Website: A visible online business presence requires having a website that users can visit
for information. Luckily, you don’t have to be an experienced web developer to create a website for
your business.
 Many services (such as Wordpress and Wix) make it easy for you to set up a business website
using simple, guided steps.
 Google has partnered with local business services through the Get Your Business Online
(GYBO) program to help businesses create websites and promote themselves online in other
ways.
 You can also work with a company (such as Go Daddy) to purchase a website domain name.
Many of these company also offer services to help you build the website, or will create one for
you. These services usually have a low monthly fee.
 Try to make your website’s domain name one that matches your business name, or, if that is not
possible, one that describes what products or services it offers.
Build content on your website: Once you’ve created a basic website, you should start filling it with
useful information. Think about what potential customers would like to know about your business,
and make sure that the information is easy to find. You can include:
 Location
 Hours of operation
 Contact information (telephone, email, etc.)
 Information about products and services that your business offers
 Descriptions of any special offers
 Your business logo, prominently featured
 The history of your business
 Testimonies or reviews from past clients/customers
Share your Uniform Resource Locator (URL): You want every customer to be able to find your
website easily. While search engines can make this possible, you should also seize every opportunity

Dr. Meghashree A. Dadhich


to share your website’s address (URL). Print it on business cards, invoices, brochures, promotional
materials, etc.
Choose a blogging service: Many companies also like to share information with customers by
writing and posting regular news, stories, and offers online. You can incorporate a blog into your
website using help from a website set-up service or program. You can also create a blog on a separate
website with help from a blogging service.
Blog Regularly: Blog is a contraction of two words: Web & Log. A blog is a regularly updated online
diary that also features links to news and stories on the web. Blogs can be used to show the world
what your business offers or cares about. The important thing is to update frequently, if your blog
hasn’t had new content in a while, people might think that your company not active. On the other
hand, avoid updating your blog so frequently that subscribers are annoyed with the inundation of
information.
 It is a good idea to create a backlog of content that is ready to go up on your blog at any time.
That way, if you are too busy to create content from scratch, you can pull something from this
pool of material.
 List posts (Like “Top 10 Customer Favourites”) or roundups (“Highlights of the year”) can be
created quickly, and will pull users deeper into your blog, if you link to older blog posts or other
areas of your website.
 Make your blog content shareable. Most blogging services already have this feature built in. This
allows users to repost your content on their own websites or blogs, easily promoting your
business more widely.
Learn about Search Engine Optimization (SEO). If you are serious about promoting your business
online, you will want to learn how to maximize opportunities for users to interact with your online
content and site(s) through major search engines (such as Google, Yahoo!, and Bing). You can learn
more about this technique, called SEO, by reading tips online, or taking an online or in-person
course. Marketing companies can also work with your business on SEO matters.
Make your website mobile-friendly. An increasing amount of online traffic comes from users of
mobile devices. To make websites easier to read (and less taxing on users’ data plans), they should be
optimized for smart phones, tablets, and other mobile devices. Some website services and programs
incorporate mobile optimization automatically, but you should frequently view your website on a
variety of devices to make sure that it is user-friendly.
2nd Method: USING SOCIAL MEDIA
Promote your business using a variety of social media. Many potential customers are on social
media, and your business should have a presence there, too. That way, you will maximize the number
of opportunities to share information about your business and to connect with the public. There are

Dr. Meghashree A. Dadhich


many social media services available that you can sign up with, and each one has distinct features.
Major services include:
 Facebook  YouTube
 Twitter  LinkedIn
 Instagram  Google Plus
 Pinterest  Foursquare
Use the social media that make most sense for your business. You don’t have to spread yourself
too thin by trying to be active on all social media. Make sure you have a presence on the largest
services, and then tailor your online presence with more specific ones. For instance, a restaurant may
definitely want to have a Facebook account, but it may then be more important for it to have a
presence on services like Yelp and Open table rather than an Instagram account.
Network with customers and other businesses. LinkedIn is probably the most popular social
networking service for professionals and businesses, but all social media offer ways to connect with
customers. Make sure that you are connecting with customers, vendors, and even competitors on all
of your social media accounts.
Respond to people on social media. Take the time to connect you’re your customers via social
media. For instance, if a customer says something great about your company, repost, “like,” or
“favourite” the comment. Likewise, if a customer asks a question, answer it online. Your customers
will appreciate the attention and feeling like they can reach out to your business.
Post multimedia content. Online promotion provides lots of opportunities to share information
about your company in audio-visual formats. You can post material both on your own website and via
social media services like YouTube, Pinterest, Instagram, Vimeo, and Flicker. Content might include
commercials, promotional videos, and photos of your products, projects, services, etc.
Use social media for press releases. Customers spend lots of time on social media, and you will
want to connect with them meaningfully. Anytime your business has notable news (a new product, a
special offer, an award, an event, a contest, etc.), post something about it on every social media
service it uses.
3rd Method: INCREASE ONLINE PRESENCE
Decide how you want to advertise your business online. In addition to a website and social media
content, you can promote your business by placing ads on other content. The process of creating and
placing advertisements online has been streamlined by search engine and social media companies.
Look into their services for business to find out more about options like:
 Banner ads that display across websites that users visit.
 Pay per click (PPC) advertising, which generates revenue when users click on sponsored links to
or ads for your content while browsing online.
 Google AdWords, which offers PPC and other advertising options.

Dr. Meghashree A. Dadhich


 Ads placed in social media, such as Facebook and Twitter.
Register with location listing services. Major search engines have services to make it easier for your
business to be found by browsing customers using maps and other location-oriented tools. Typically,
all you have to is register and the service will verify your business. Common services of this type
include:
 Google Places  Yahoo! Local  Bing
Register with service listing sites. If you sign your business up with sites that list information about
businesses, then customers can find out more about your company, read and post reviews, etc. You
can also interact with customers in this way, by responding to reviews, for instance.
Sign up with an email service. You can reach out to your customers by creating regular content to
email to them. This content, like blog posts, can describe products or services, special offers,
company news, etc. Managing a list of customer emails and sending this information out at regular
intervals can be tedious, but you can contract with a company such as Mail Chimp or Constant
Contact to handle emailing services for you.
Public Relations and the Internet
The Internet has caused a revolution in communication by giving a voice to those that previously
could not have been heard. This has opened a whole new world of opportunities for both businesses
and individuals that were unimagined in the era of the traditional media. These still play an important
role in shaping the public opinion but with the entire globe moving to the online world to search for
information and buy products/services, a PR that does not effectively communicate with the online
community can no longer effectively shape and maintain the desired public image.
Challenges of the Internet for PR
Although the Internet is one of the greatest inventions in human history, it has dramatically changed
the world and above all, the communication. The World Wide Web has opened a number of
opportunities but it has also opened a number of challenges, especially for the PR sector that has
mastered communication with and through the traditional media. While PR specialists virtually had
no competition in the era of the traditional media, the democracy of the Internet has forced them to
compete with the entire world.
The Internet has given just about everyone the ability to share their opinion just about everything
with the entire world in a matter of seconds. The ability to reach thousands or millions of people in
virtually no time gave PR specialists a powerful tool but it also made their jobs more difficult,
especially in case of an attack on integrity of their clients. Just imagine restoring the client’s
reputation if the first page of search engine results contains mainly compromising or damaging
content.

Dr. Meghashree A. Dadhich


The Importance of Internet PR
Why businesses and individuals who want to succeed in the modern world cannot afford not to utilise
the Internet PR is clearly evident from the example of “anti-campaigns”. These can either be an
unfortunate incident or a carefully devised plan of unethical competition. But regardless of who
stands behind and why, negative campaigning can have a devastating effect on public reputation of a
company or an individual. The risk of negative publicity, however, is not the only reason why the
Internet PR is increasingly gaining in importance.
The Internet has a major influence on people’s opinion and the decisions they make, especially when
they are uncertain. For example, let’s say Joe has difficulties deciding which anti-acne cream to
choose. He will open his search engine and look for information about the creams he is considering
buying. He will most likely take into account a variety of factors including the price and other
people’s opinions but his decision will also be influenced greatly by the information he will be able to
receive about a particular product. And if he finds little information about how the product is
supposed to work, how soon he will be able to see the results, etc. there is a great chance that he will
not buy that product.
In order to encourage Joe to at least consider buying your cream, he needs to be provided accurate,
trustworthy and up-to-date information about both the product and your company. And this can be
achieved only through an effective Internet PR.

Chapter – 03
Dr. Meghashree A. Dadhich
Electronic Media & Its Role in Mass Communication
Electronic Media
Electronic Media are media that use electronics or electromechanical energy for the end
user (audience) to access the content. This is in contrast to static media (mainly print media), which
today are most often created electronically, but do not require electronics to be accessed by the end
user in the printed form. The primary electronic media sources familiar to the general public
are video recordings, audio recordings, multimedia presentations, slide presentations, CD-
ROM and online content. Most new media are in the form of digital media. However, electronic
media may be in either analogue electronics data or digital electronic data format. They may include
television, radio, Internet, fax, CD-ROMs, DVD, and any other medium that requires electricity or
digital encoding of information. The term 'electronic media' is often used in contrast with print media.
Communication using electronic media allows transmission of message or information using
computer systems, fax machine, e-mail, telecommunication or video conferencing and satellite
network. People can easily share conversation, picture, image, sound, graphics, maps, interactive
software and thousands of things for the development of electronic communication. Due to electronic
technology, jobs, working locations and cultures are changing and therefore people can easily access
to worldwide communication without any physical movement.
Advantages of Electronic Communication
The following points highlight on the advantages of electronic communication:
1. Speedy transmission: It requires only few seconds to communicate through electronic media
because it supports quick transmission.
2. Wide coverage: World has become a global village and communication around the globe
requires a second only.
3. Low cost: Electronic communication saves time and money. For example Text sms is cheaper
than traditional letter.
4. Exchange of feedback: Electronic communication allows instant exchange of feedback. So
communication becomes perfect using electronic media.
5. Managing global operation: Due to advancement of electronic media, business managers can
easily control operation across the globe. Video or teleconferencing e-mail and mobile
communication are helping managers in this regard.
Disadvantages of Electronic Communication
Electronic communication is not free from the below limitations:
1. Volume of data: The volume of telecommunication information is increasing in such a fast rate
that business people are unable to absorb it within relevant time limit.
2. Cost of development: Electronic communication requires huge investment for infrastructural
development. Frequent change in technology also demands for further investment.
Dr. Meghashree A. Dadhich
3. Legal status: Data or information, if faxed, may be distorted and will cause zero value in the eye
of law.
4. Undelivered data: Data may not be retrieved due to system error or fault with the technology .
Hence required service will be delayed
5. Dependency: Technology is changing everyday and therefore poor countries face problem as
they cannot afford new or advanced technology. Therefore poor countries need to be dependent
towards developed countries for sharing global network.
A business will need to provide messages in different formats or media. This depends on the
individual needs of different stakeholders and whether the message is internal or external. Internal
communications take place within the organisation. External communications take place with people
or bodies outside the organisation such as regulators, the government and the press. Any
communication provides an opportunity for good public relations (PR).
To communicate effectively, the message needs the correct medium. This depends on the nature of
the communication and the direction of the message across, up or down an organisation or group.
Vertical communication up and down the organisation may be necessary when a particular message
must be delivered quickly and exactly, for example, a change to interest rates on a product. This
change needs to be understood throughout the society from the marketing department who advertise
through to the branch staff who sell it to members.
Lateral communication across the organisation may be within building societies or between them and
their customers. For example, when informing members of legal changes, a letter to individual
members would be the most appropriate route. If the society wanted to communicate to new or
prospective customers/members, then TV or leaflet advertising would be effective.
The media industry today is at its most critical juncture since an earlier rush of new technologies
made mass media possible.
The Importance of Television for Business Promotion & PR

Television is now the second most popular mass media channels in the world, and its growth is seen
all over the world every day. Because of its transmission of speech and moving pictures, it has
become one of the most viable and strong story tellers. Television is therefore a means for political,
economic, cultural and other elites to inform, educate, entertain and influence the public. The
information flow is more or less in one direction from the actors to the mass television audience.
Watching TV is the most common leisure activity in our country today. It is the medium where the
consumer spends the most “attentive” time. A number of surveys report average daily television
viewing time as high as five to six hours. No wonder it has grown into a giant advertising medium.
While the newspaper may cover the city’s general metropolitan area, TV offers the greatest
possibility for creative advertising. With a camera, you can take your audience anywhere, and show
them almost anything. The power of television is in its ability to simultaneously appeal not only to
Dr. Meghashree A. Dadhich
sight and hearing, but to strengthen interest through the dimensions of movement and the realism of
full colour. It is comprised of pictures and words, but of the two, the pictures are infinitely more
important.
TV advertising can show and tell many people about the product or service and actually demonstrate
the benefits of ownership. Since they see how it works and how it is packaged, every time they see it
they will be psychologically reminded of their desire to have it.
Television always has been a popular medium for large retailers, but because of lowered production
costs and the ability of cable to reach smaller market areas, its use by small and medium size
businesses is becoming more popular. Television is often referred to as the “king” of the advertising
media. It has proven its power to influence human behaviour again and again. But it is also the
“king” of advertising costs as well.
Advantages of Television Advertising
Some advantages of television advertising include the following:
 Television reaches very large audiences usually much larger than the audience the local
newspaper reaches, and it does so during a short period of time.
 Since there are fewer television stations than radio stations in a given area, each TV audience is
divided into much larger segments, which enables you to reach a larger, yet, more diverse
audience.
 It has the ability to convey the message with sight, sound and motion, and can give a product or
service instant validity and prominence.
 Message sender can easily reach targeted audiences. Children can be reached during cartoon
programming, homemakers during daytime programming, and insomniacs after midnight.
Disadvantages of Television Advertising
 When you advertise on TV, your commercial is not only competing with others, it is also
competing with the viewer’s environment as well.
 Even if your commercial is being aired, viewers may never see it unless it is intrusive enough to
capture their attention.
 A minimum amount of airtime provides limited length of exposure and ad clutter.
 The message comes and goes, and that’s it! Unless you buy additional time, the viewer doesn’t
see the commercial again.
 Multiple exposures are required to achieve message retention and consumer action. If you don’t
reach your viewer at least 5-7 times, you are just throwing money away.
 No station loyalty; viewers have little or no loyalty to the station itself – especially since cable
and Internet can bring dozens of viewing alternatives into the home. For example, viewers will
watch a given channel for a program they know will be aired at a specific time. If a football

Dr. Meghashree A. Dadhich


game, popular movie or some other preferred form of entertainment appears on another channel,
the viewer will not hesitate to switch channels without leaving the couch.
 Even when watching “live,” during a commercial break the viewer may choose to get a snack, go
to the bathroom, check social media, or have a conversation about whatever they were just
watching.
 Because of a larger “area of dominant influence,” the relative cost will be higher – both the terms
of airtime and production.
The “glitz and glamour” associated with producing a television commercial makes it one of the most
appealing advertising methods. Carefully consider the budget and other options; however, to be sure
a TV ad makes sense for the company.
Objectives or Role of Mass Communication
1. Contact with families and friends: With the help of mass communication many people can
communicate with heirs’ families or with their friends. Actually people travel around the world
and by this reason they need a good way in order to not lose the contact with their families in
their native country. The studies reveal that approximately 95% of the population use electronic
devices for their communication for example: Mobile phones, Telephones, Computers etc.
2. Universality: This refers to the extensiveness or commonness of a medium and acceptability of
messages. A person does not need to be literate or educate in a particular language before
listening to a radio program or a watch television program in that native language.
3. Permanency: This refers to the period for which a medium can hold its message thereby making
the message reviewable. A reader of a book, newspapers and magazines can read and re-read and
store it for a long term.
4. Launching business and introducing new products: Mass communications are used to make
wide circulation of senses regarding forming and launching a business and introducing new
products of the organization.
5. Wide cover: The audiences of mass communication are spread over a vast or a wide geographic
area in a given time. It can spread the product and business news of the organization over a large
part of the country and the world.
6. Rapid and continuous dissemination: In mass communication, information rapidly reaches and
continuous disseminate to large and vast number of heterogeneous audiences.
7. Interpretation: Interpretation is the function of mass media that provides a context for new
information and commentary about its significance and meaning. Traditionally, newspapers
provided such interpretation in their editorial and commentary sections, reserving news pages for
supposedly neutral information.
8. Cultural transmission or exchange: This function entails the passing on or the transfer of a
nation’s (or society) social values and heritage from one generation to another. Cultural
Dr. Meghashree A. Dadhich
transmission function as the preservation of past heritage culture from one ethnic group to
another, one nation to another and from generation to generation for the purpose of promoting
and even integrating culture. Television and film have the greatest potential for socialization
because they seem to be the most realistic.
9. Entertainment: One of the most popular functions of mass communication is entertainment.
Entertainment always has been part of society and higher percentage of audience prefers
entertainment to information. Those in this category include students, youths, teenagers, sport
lovers, kids (cartoons). Through sound recordings, film, radio and television, entertainers have
been able to attract audiences around the globe.
10. International Trade: Mass communication is only the tool for creating foreign market of a
product. In a market economy, mass communication reaches the product message across the
world and creates a market.
11. Creating new market: Mass communication helps to create a new market of a new product and
services. It uses mass media to convey the product message across the world and creates a
market.
12. Increasing business goodwill and image: Mass communication helps to increase business
goodwill and image the country and the world. It communicates with the people about mission,
social activities, educational promotion etc. Which create a favourable organizational image.
13. Advertising product and services: Mass communication plays an important role in advertising
product and services. Mass media like radio, television, newspaper and internet are the main
vehicles of advertisement.
14. Interdepartmental coordination: Generally, large organizations have various departments like
procurement, production, marketing, administration, human resource; accounts etc. Through the
help of mass communication, managers of this department cooperate and coordinate each other.
15. Inform market price, demand and supply: Mass communication helps to inform market price,
demand and supply of product and services for home and abroad.
Reasons Why Effective Communication Should Be a Focus in the Business
Communication plays a fundamental role in all facets of business. It is therefore very important that
both internal communications within your organisation as well as the communication skills of your
employees are effective. The following six reasons will explain why effective communication should
be a focus in your business:
1. Builds and Maintains Relationships
Relationships are built and can be maintained by positive encounters with others. Communication
will be key to this process – without effective skills, it will be difficult to properly construct and
foster productive relationships.

Dr. Meghashree A. Dadhich


2. Facilitates Innovation
When employees feel comfortable in openly communicating new ideas, cooperation and innovation
will be at an all-time high. In addition, if staffs are unable to convey their ideas due to limited
communication skills, it is likely that the idea will not be implemented to its full potential.
3. Builds an Effective Team
If open communication within a workplace is encouraged, a more cohesive and effective team will
emerge. Good communication within a team also tends to boost employee morale. When employees
feel that they are well informed of the company’s direction and vision, they will feel more secure
within their role. Regular internal communication can also lead to an improved work ethic if staff are
reminded of achievements and feel that they are working towards a common goal.
4. Managing Employees
When managers are effective communicators, they are more able to inform staff adequately of their
responsibilities and what is expected from them. Good communication skills also helps managers to
provide constructive feedback to their staff, build better relationships, and understand personal goals
that staff may wish to work towards.
5. Contributes to Growth of the Company
A lack of communication can lead to the collapse of any organisation. Whilst that is a bold statement
– without proper marketing collateral and communication internally and externally, most
organisations will struggle to survive. Communication can also lead to productivity and helps to
avoid unnecessary delays in the implementation of policies.
6. Ensures Transparency
When regularly communicating both internally and externally, organisations remain more
transparent. This is important in building trust in your brand, in your services and also internally
when it comes to the trust that employees have in higher management.

Chapter – 04
Customer Service & Complaints Handling
Businesses nowadays need to positively delight customers if they want to earn their loyalty.
Customer complaints are inevitable, no matter how streamlined your business. They must always be
acknowledged and dealt with effectively. By ignoring or dismissing complaints, you are effectively
telling the customer that you don’t value their opinions. Many business owners see complaint
management as a time-consuming and frustrating process. However, by developing an efficient
system, complaints can be resolved quickly and easily.

Dr. Meghashree A. Dadhich


At some point, everyone in business has to deal with an upset customer. The challenge is to handle
the situation in a way that leaves the customer thinking you operate a great company. If you’re lucky,
you can even encourage him or her to serve as a passionate advocate for your brand. When it comes
down to it, many customers don't even bother to complain. They simply leave and buy from your
competitors. Research suggests that up to 80 percent of customers who leave were, in fact, "satisfied"
with the original company. Obviously, customer satisfaction is not enough.
It may seem counter-intuitive, but a business owner’s ability to effectively deal with customer
complaints provides a great opportunity to turn dissatisfied customers into active promoters of the
business. Here are some customer-oriented tips:
1. Listen carefully to what the customer has to say, and let them finish: Don't get defensive.
The customer is not attacking you personally; he or she has a problem and is upset. Repeat back
what you are hearing to show that you have listened.
2. Ask questions in a caring and concerned manner: The more information you can get from the
customer, the better you will understand his or her perspective. I’ve learned it’s easier to ask
questions than to jump to conclusions.
3. Put yourself in their shoes: As a business owner, your goal is to solve the problem, not argue.
The customer needs to feel like you’re on his or her side and that you empathize with the
situation.
4. Apologize without blaming: When a customer senses that you are sincerely sorry, it usually
diffuses the situation. Don't blame another person or department. Just say, "I'm sorry about that.”
5. Ask the customer, What would be an acceptable solution to you?: Whether or not the
customer knows what a good solution would be, I’ve found it’s best to propose one or more
solutions to alleviate his or her pain. Become a partner with the customer in solving the problem.
6. Solve the problem, or find someone who can solve it quickly: Research indicates that
customers prefer the person they are speaking with to instantly solve their problem. When
complaints are moved up the chain of command, they become more expensive to handle and
only add to the customer's frustration.
There is no getting around customer complaints, regardless of your industry. However, by employing
these steps and taking the time to review the issue with the customer, you can turn challenges into
something constructive.
How to Handle Complaints
There are several key stages when handling a complaint:
1. Thank the customer for complaining - You should consider yourself lucky that the customer is
prepared to give up their time and money to let you know they have a problem, instead of just
walking away - a complaint is a gift.

Dr. Meghashree A. Dadhich


2. Say that you are sorry that the problem has happened - This is NOT an admission of guilt on
your part, it's just good manners.
3. Put yourself in the place of the customer - This will instantly give you an advantage, as you
not only will have more empathy with the customer, but also you know your business better than
them and so can hopefully see the solution quicker.
4. Start with the view that the customer has a valid point, not that they are trying to rip you
off - It is true that there are some professional complainers out there, but they are in the minority,
and, if you are a local store, you probably know them anyway. Accepting that the customer may
well have a point, even internally, may well trigger off ideas for an acceptable resolution.
5. Get all the facts first - Letting the customer give you all of the information helps you fully
understand the situation AND, if they are emotional, will give them time to calm down.
6. Correct the mistake - Don't leap straight to the "free gift" route. While it's very tempting to give
the customer a gift, or vouchers, too often it is done INSTEAD of solving the problem. This can
lead to more complaints about the same thing in the future because the problem hasn't been
hasn't been fixed.
7. Make sure that your definition of the right fix is the same as the customers.
8. Learn from every complaint - Do something! Fix the process; train staff in the issue; eliminate
the fault. Wherever possible let the complaining customer know that they have helped you
resolve a problem - they'll feel great and come back again and again (and will probably tell their
friends!).
9. Minimise reasons for complaints - Do you have a continuous improvement culture? Do you
check customer (and employee) satisfaction regularly? Do you check the quality of the goods
sold in your organisation?
10. Always respond - Make sure that EVERYONE who complains on the telephone, by letter, or by
email gets a rapid and appropriate response.
11. Listen to your staff - They nearly always care about your company and doing a good job. They
are also much closer to the customers than you are. Ask their views regularly and make changes
when they are sensible. Make sure THEIR complaints are handled too.
12. Lead by example - It's not that your staffs DON’T listen to what you say, it's that they DO
listen, so make sure that you are always setting the right example, and giving complaints your
personal priority. Reward good complaints handling.
Remember - it costs at least five times as much to gain a new customer than keep an existing one.
Keeping a complaining customer should be the top priority, and at these cost ratios you can afford to
be generous in your time and effort.

Dr. Meghashree A. Dadhich


Useful Tips for Dealing with Complaints
 Try to remain calm when dealing with a complaint - even if the customer becomes irate or
confrontational: Your ultimate aim is to turn their negative experience into a positive one, but
arguing back will only make the situation worse.
 Complaints should always be resolved as quickly as possible: The aim is to make the
customer feel as though their problem is being treated as a priority, without being rushed.
 Keep comprehensive records of all customer complaints, from the initial problem to the
eventual solution: You can then periodically assess these records, identifying any common
complaints, and taking steps to improve company processes.
 All customer-facing staff members should be trained to deal with complaints: If possible,
give your employees some authority when it comes to issuing refunds or other consolatory
gestures. Forcing the customer to wait for a manager can make a bad situation worse.
Although no one likes receiving a complaint, they present you with an opportunity to identify and
rectify specific problems with your current systems or product. They can also help you to develop
your relationship with your customer by allowing you to demonstrate that you value their trade by
taking their concerns seriously and dealing with their complaint.

Chapter – 05
Principles & Methods of Due Collection
An effective collections policy requires some kind of formal system that ensures overdue accounts
get paid. Letting late payments languish can disrupt cash flow and harm your company's chances of
success. Fortunately, most customers pay their bills in the normal course of business. In fact, based
on historical data compiled by the Foundation, delinquency generally averages between 7 and 9 days
across all industries at any given time. Additionally, delinquency in excess of 91 days for all
industries rarely surpasses 2 percent.

Dr. Meghashree A. Dadhich


Good business requires that collection of invoices be made promptly and without any damage
resulting to the customer relationship. It is this latter requirement, namely, to retain the customers'
goodwill, which makes the collection problem a difficult one and which makes skill and tact essential
in the handling of collections. Just how much pressure is to be brought to bear to obtain prompt
collections and to what extent the relationship may be jeopardized in the effort are questions of
policy. The collection problem should be analyzed and the collection policy defined in accordance
with such objectives as:
 The policies of the selling division involved with the problem.
 The economic climate in general.
 The importance of the customer.
 The effect of the combination of dollars and number of customers delinquent on the entire
receivables portfolio.
Principles of Collection
Certain principles have been found especially useful in the field of collection and may be grouped
into the following areas:
 Collect the money
 Maintain a systematic follow-up
 Get the customer to discuss the account
 Preserve goodwill
Collect the Money: The primary job of the person responsible for collections is to collect the money
as close to the terms of the obligation as possible. There should never be any doubt as to why the
individual is engaged in this particular task. The debtor has an obligation to pay within the terms of
the agreement. It is the job of the collection person to make sure that this obligation is met. The tone
may be indulgent at first, but should be intensified and accelerated as much as necessary to ensure
payment by a debtor.
Systematic Follow-up: After the initial contact with the delinquent customer, it is important to keep
additional contacts on a strict schedule. If the collector, for example, is told that a check will be
mailed in a few days, it should be noted. If the check is not received at the promised time, a follow-
up is essential; otherwise the collection effort will become ineffective.
Systematic follow-up of accounts, even those which cannot pay immediately, reinforces the serious
nature of the outstanding debt and emphasizes the importance attached to it by the creditor. That in
itself is an important collection advantage.
Discussing the Account: Once the collector gets the customer to talk about the delinquent account,
the collector is well on the way to receiving payment. That is why emphasis is placed on inviting the
debtor to talk. The object of the discussion is to get the debtor's explanation of the delinquency. It

Dr. Meghashree A. Dadhich


may be a question of a dispute; it may be due to a temporary shortage of funds; or the customer may
intend to hold off payment so the creditor's money can be used in its own business.
During the discussion, the collector may begin to see the debtor's situation more clearly. If the slow
payment is the result of a temporary cash flow problem, tolerance of slower payments may be
accepted, but it should be emphasized to the customer that the new schedule of payments must be
completed.
Preserve Goodwill: Even though the customer may be experiencing some difficulty in meeting
payments, it does not preclude them from becoming a good customer in the future. Therefore, it is
important to preserve goodwill while pressing for collection. This requires not only tact, but
knowledge of the customer and industry. One of the advantages claimed by specialized collection
personnel is that they can develop these techniques to their fullest. On the other hand, the team
concept presents the opportunity for credit and customer service personnel to better understand the
relationship of the customer to the industry and overall marketing objectives of the company.
Debt / Due Recovery Procedure
To keep receivables flowing smoothly, many businesses use a series of letters and phone calls to
encourage customers to pay. These communications start out friendly and progressively become more
serious and insistent as payments become overdue. How you structure your collections system is an
individual matter - you may be more comfortable calling up clients than sending letters, for instance.
The important thing is to have a system, and you can use the steps outlined below to create yours.
Step 1: Customer Satisfaction Phone Call
Dissatisfied customers are more likely to pay late. These friendly calls let you inquire about your
performance to ensure you met your customers' needs. End these calls by mentioning that a bill will
be arriving shortly, and reinforce its due date. Timing: three days after delivery of your product or
service, but before payment is due.
Step 2: First Overdue Notice
This is a friendly reminder that the due date has passed. You are assuming that the client has forgotten
neglected, or lost the bill and will pay with a gentle prodding. One common method is to send a
duplicate invoice with "past due" stamped on it. Timing: ten days after the invoice due date.
Step 3: Second Overdue Notice
Another mild nudge reminds the customer that the account needs attention. This can be a short form
letter with a duplicate invoice attached. Keep it friendly and non-threatening. For example:
[Date]
[Name/address of debtor]
Re: Invoice # ____________
Amount due ____________
Date due ____________

Dr. Meghashree A. Dadhich


Dear ____________
We recently mailed you a statement showing that your account is past due. Perhaps it has been
overlooked. Here is another copy. Please send payment today, so that we can keep your account
current. Thank you!!! Timing: 10-15 days after first overdue notice was sent/20+ days after the
invoice due date
Step 4: First Collection Phone Call
Follow the overdue notices with a phone call to find out if there is a reason for non-payment. For
example, the customer may be dissatisfied with your product or service, or may be experiencing cash
flow problems. Be courteous, but also get a commitment to pay. Be prepared to handle excuses. For
example, if the debtor says the check was sent, ask when it was mailed and where it was sent so you
can determine the day it should arrive. Timing: 7-10 days after second overdue notice is sent out/27
+ days after the invoice due date
Step 5: First Collection Letter
Keep the tone of this letter consistent with the first phone call - courteous, but direct. Confirm in
writing what was said in the call, and remind the debtor of his or her promise to pay. For example:
[Date]
[Name/address of debtor]
Re: Invoice # ____________
Amount due ____________
Date due ____________
Dear ____________
This confirms of our conversation on [Date]. As we discussed, you will send us your payment in full.
Let us settle this matter now. Please mail in a check today.
Thank you. Timing: immediately after the first collection phone call/28+ days after the invoice due
date
Step 6: Second Collection Phone Call
The account is now 30-40 days past due. Be polite yet firm, and ask for full immediate payment.
Work to resolve payment problems. If the debtor cannot pay immediately, get him or her to commit
to a payment date. Timing: ten days after the first collection letter has been sent/38+ days after the
invoice due date
Step 7: Second Collection Letter
Now is the time to communicate the seriousness of the delinquency. This letter should demand
immediate payment, and discuss the short-term consequences of failure to pay. Send this letter - and
any correspondence that follows - via certified mail or overnight mail to give you a record that it was
received. For example:
[Date]

Dr. Meghashree A. Dadhich


[Name/address of debtor]
Re: Invoice # ____________
Amount due ____________
Date due ____________
Dear: ____________
Your account is now seriously past due. If payment is not received within 7 days, we will be forced to
suspend your credit privileges with our company. We value you as a customer. Help us continue to
serve you by bringing your account up to date immediately. Please mail us a check today.
Thank you. Timing: ten days after payment is expected from previous collection phone call/50+ days
after the invoice due date
Step 8: Third Collection phone Call
While remaining polite and calm, stress the seriousness of the situation. Use this phone call to
explain that this is the last opportunity for the customer to pay before you turn the matter over to a
collection agency and possibly take further legal action. Be sure to communicate the benefits of
resolving the issue - maintaining good relations or good credit. As with the previous phone call, get
the debtor to promise to pay by a certain date. Timing: 15 days after second collection letter is sent
out/65+ days after the invoice due date
Step 9: Final Collection Letter
The tone is now stern and demanding. Use this letter to confirm what was agreed upon in the last call
and demand payment. State that if payment is not received by the agreed-upon date, you will turn the
account over to a collection agency. For example:
[Date]
[Name/address of debtor]
Re: Invoice # ____________
Amount due ____________
Date due ____________
Dear ____________
This letter confirms our conversation on [Date]. You must take immediate action to make your
account current. If we do not receive payment within ten days, we will be forced to turn the matter
over to a collection agency, which may adversely affect your credit rating.
Please mail a check to us immediately. Timing: seven days after third collection phone call/72+ days
after the invoice due date
Step 10: Turn Over to Collection Agency
The account is now 90+ days in arrears and may require professional assistance. Receiving a letter
from a collection agency often motivates a debtor to pay, but these services can be costly - agencies
typically take from a quarter to a half of what they collect. Instead of immediately turning the

Dr. Meghashree A. Dadhich


account over to a collection agency, you might want to enlist your attorney to make a quick phone
call to the debtor - this can often motivate payment. Timing: If payment has not been received by 10-
15 days after the final collection letter is sent/90+ days after the invoice due date
Ways to avoid bad debt occurring
To reduce the possibility of customer bad debt in your business you can:
 Perform a thorough background check on a business before offering credit.
 Set safe customer credit limits.
 Only release goods when payment has cleared.
 Wait for direct deposit payment to clear before shipping any goods.
 Send invoices out as soon as a job is complete, or on a regular date.
 Clearly state all payment options and information on your invoices or contracts to make it
easier for customers to pay you.
 Keep regular contact with your customers.
 Offer a small percentage discount for early payment of bills
It is a good practice to clearly outline at the beginning of a customer relationship your expected terms
of trade and payment.

Chapter – 06
Communication with Aids to Trade & Role of Advertisements in
Business
Trade or exchange of goods involves several difficulties, which are removed by auxiliaries known as
aids to trade. It refers to all those activities, which directly or indirectly facilitates smooth exchange
of goods and services.

Dr. Meghashree A. Dadhich


Aids to trade includes Transport, Communication, Warehousing, Banking, Insurance, Advertising,
Salesmanship, Mercantile agents, Trade promotion organizations in a country and Global
organizations for international trade. Auxiliaries ensure smooth flow of goods from producers to the
consumers.
What are various Aids to Trade?
The importance of aids to trade in commerce is explained in following points:
1. Transport: In the modern times there is a vast distance between centres of production and the
centres of consumption. This difficulty is removed by an important aid to trade known as
transport. Transport creates place utility. There are several types of transport such as air, water
and land transport. The geographical distance between producers and consumers is removed with
the help of transport.

2. Communication: Communication means transmitting or exchange of information from one


person to another. It can be oral or in writing. It is necessary to communicate information from
one to another to finalize and settle the terms of sales such as prices of goods, discount allowed,
facility of credit, etc. Modern means of communication like telephone, telex, telegraph, email,
teleconference, etc., plays an important role in establishing contact between businessmen,
producers and consumers.
3. Warehousing: There is a time gap between production and consumption. In other words, goods,
which are produced at one time, are not consumed at the same time. Hence, it becomes necessary
to make arrangements for storage or warehousing. Agricultural commodities like wheat and rice
are seasonal in nature, but are consumed throughout the year; on the other hand, goods such as
Dr. Meghashree A. Dadhich
umbrellas and woollen clothes are produced throughout the year but are demanded only during
particular seasons. Therefore, goods need to be stored in warehouses till they are demanded. So it
creates time utility by supplying the goods at the right time to the consumer.
4. Insurance: Insurance reduces the problem of risks. The business is subject to risks and
uncertainties. These are inevitable in the field of business. Risks may be due to fire, theft,
accident or any other natural calamity. Insurance companies who act as risk bearer cover risks.
Insurance tries to reduce many risks by spreading them out over a greater number of people. The
rate of premium depends upon the type of risks and the period for which the risk is covered.
5. Banking: Banking solves the problem of finance. Businessmen receive money and also pay
money in large amounts. It is risky to carry large amount of cash from one place to another. Here
comes Banking as a solution. Banking and financial institutions solves the problem of payment
and facilitate exchange between buyer and seller. The businessmen may also require short-term
and long-term funds. Banks provide such finance to businessmen. Banks also advances loans in
the form of overdraft, cash-credit and discounting of bills of exchange.
6. Advertising: Advertising fills the knowledge gap and it solves the difficulty of information.
Exchange of goods and services possible only if producers can bring the products to the
consumers. Advertising and publicity are important media of mass communication. Advertising
helps the consumers to know about the various brands manufactured by several manufacturers.
The media used to advertise products are Radio, Newspapers, Magazines, TV, Internet, etc.
7. Salesmanship: It facilitates personal selling. Many a times, sales force is required to book orders
directly from dealers or customers. Salesmanship is very much required in the sales of services
and industrial goods. Again the sales force plays an important role in direct marketing, especially
in the case of selling insurance policies.
8. Mercantile Agents: It removes personal difficulties. Mercantile agents are the middlemen who
form a link between the buyers and the sellers. They do not carry on business in their own name.
In the process of distribution, producers and consumers are unable to have direct contact, as
consumers are spread over a vast area. Mercantile agents remove this difficulty of personal
contact. There are several types of mercantile agents such as brokers, commission agents,
auctioneers, underwriters, insurers, etc.
9. Trade Promotion Organizations in a Country: They attend to difficulties of promotion and
development of trade at the national level. These are the organizations established by the
business community to protect and promote their interest. They play promotional and
developmental role for members. They do market research work, act as a clearing house of
information, put their grievances before the government, make representations, and help the
business community in many ways. The examples include Chambers of Commerce, Export
Promotion Councils, Indian Institute of Packaging, etc.

Dr. Meghashree A. Dadhich


10. Global Organizations for International Trade: They attend the promotion and development of
trade at international level. The main objective of global organizations is to promote
International trade. It helps exporters and importer by collecting information about international
marketing trends. The examples of such global organizations are World Bank, IMF, WTO, etc.
Role of Advertising in the Present Business World
Advertising is a form of communication intended to persuade an audience (viewers, readers or
listeners) to take some action. It includes the name of a product or service and how that product or
service could benefit the consumer, to persuade potential customers to purchase or to consume that
particular brand. Modern advertising developed with the rise of mass production in the late 19th and
the early 20th centuries. Commercial advertisers often seek to generate increased consumption of
their products or services through banding, which involves the repetition of an image or product
name in an effort to associate related qualities with the brand in the minds of consumers. Different
types of media can be used to deliver these messages, including traditional media such as
newspapers, magazines, television, radio, outdoor or direct mail; or new media such as websites and
text messages. Advertising may be placed by an advertising agency on behalf of a company or other
organization. Non- commercial advertisers that spend money to advertise items other than a
consumer product or service include political parties, interest groups, religious organizations and
governmental agencies. Non profit organizations may rely on free mode of persuasion, such as a
public service announcement.
In the current fragmented market, the marketers are facing tough competition from their competitors.
Each marketer has to prove himself to be better than his competitors. The cut-throat competitive
market environment has made the advertising field very experimental and hence advertisers are
adopting different measures to attract the attention of their target customers. They try to present their
advertisements in such a way that catches instant customer attention. For this, they use a blend of
message appeals like rational, emotional, ethical, etc. to make a positive impact on the target
audience. Aspirations, comfort, convenience, economy, efficiency, fear, love, nostalgia, pride, health,
luxury, patriotism, sex and safety are some of the ideas that engage the minds and touch the hearts of
the target audience, and ultimately motivate a response.
Being business entities, sometimes companies are carried away with their profit motives. They forget
that as they are a part of the society, they have a responsibility towards the society, as well. Any
activity of the company should not have an adverse effect on the society. The same stands true in
respect of advertising also. With the growth in the reach and frequency of mass media, the
advertising industry has also grown by leaps and bounds. It implies that the persons exposed to
advertising are also growing with the growth of mass media and the advertising industry. On the one
hand, it is a good sign for the marketers as they can now reach a larger audience by using mass media
but on the other hand, it has increased their role towards the society. Now marketers have to be more

Dr. Meghashree A. Dadhich


socially responsible while making and presenting their advertisements as the presentation of
advertisements can have a positive as well as a negative impact on the society.
In this ad-mad world, the viewers are exposed to thousands of ads. It is almost impossible for them to
pay attention to all those ads. Only those ads are able to catch their attention, which are different in
some way or another from the other bouquet of ads. To break this monotony and to make advertising
catchy, marketers are dishing out a wide variety of advertisements. They try to give a different touch
to make it look appealing. Sometimes they succeed in their experiments, at other times their efforts
raise the eyebrows of the viewers. It is often seen that in the name of experimentation and in the
desire to win the market game, marketers every now and then are involved in making ads, which
cannot be termed as `ethical'.
Advertising carries several responsibilities. Advertising informs the public so that they can be aware
of products and make informed choices among different products or brands. Advertising also benefits
businesses in assisting them to sell their products.
But while dispensing its role as a dream merchant, advertising has also been in the vortex of
controversy of the many ills that it brings to society. It is accused of encouraging materialism and
consumption, of stereotyping, of causing us to purchase items for which we have no need, of taking
advantage of children, of manipulating our behaviour, using sex to sell, and generally contributing to
the downfall of our social system.
Advertising does not function in a vacuum but in a market environment where several forces like
consumer needs, business interests and government regulations are at work. It is a powerful force in
terms of its persuasiveness and functions a critical social role. Moreover the high visibility and
pervasiveness, it generates criticism and controversy. Much of this controversy springs from the fact
that advertising is used more as a persuasive communication tool thereby creating serious impact on
the tastes, values and lifestyles of society.
In today's challenging market economy, advertising has become an important element of the society.
Moreover, advertisements play a powerful constructive role in the economic growth of a country. On
the contrary, they can often play a negative role in hurting the sentiments of an individual or the
society. Hence, it is important that advertising professionals observe high ethical standards in regard
to truthfulness, human dignity and social responsibilities.
Advertising: - According to some people advertisement is the printed salesmanship which makes the
goods popular. In other word we can say that advertising is a technique of influencing the minds of
the public to buy the goods advertised. It is a powerful art of attracting the customers for particular
goods. Advertising makes the commodity popular among the people through the use of media like
newspapers, radio, TV and sign boards. It attracts the people and creates demand for the product.
Advantages or Functions or Importance of Advertising

Dr. Meghashree A. Dadhich


Today in the modern business advertising is playing very effective role. It is used as too of marketing.
The expenditure on advertising is considered as a profitable investment. Following are the main
advantages of advertising:
1. Increases Sale: - Advertising is very useful in creating the demand and increasing the sale. As
the sale of any commodity increases, its production also increases.
2. Provides Employment: - In the advertising industry thousands people are employed. On the
other hand when the sale of the goods increases, new factories are established and rate of
employment increases.
3. Save Time: - Advertising enables the consumer to select the commodity according to his
requirement within no time. Because he has been already informed about the standard of various
goods through advertising.
4. Introduces New Products: - New products can be introduced in the market within short time
through advertisement.
5. Establishes Goodwill: - Advertising establishes reputation and goodwill of the firm.
6. Encourages Competition: - Advertising encourages competition among the producers. So
competitors in the quality and price of the product.
7. Reduces Cost: - Advertising increases the sale and encourages the produce the goods on large
scale. Due to large scale economies cost of production reduces.
8. Changes the Living Standard: - Advertising brings greater change in the habits attitudes and
standard of living of the public.
9. Increases Profit: - Advertising increases the sale and total profit of the producer. Due t this we
say that advertising is a profitable investment.
10. Advantage to the Consumer: - Advertising supplies up to date information about the
competition products and their qualities.
11. Educative Value: - Advertising teaches the people the benefits of savings. It also creates the
sense of responsibility among the people. For example to increase the savings in the country and
to control the population growth advertising has played very effective role.
12. Direct Sale: - Through advertising producer is also introduced direct in the market. People may
purchase the goods directly from the producer and can save money.
13. Makes the Job Easy for Salesman: - Advertising makes the salesman job easier. There is no
need of explaining the qualities of a product to consumer. Through advertising customer is
already well informed. So a salesman can sell the product without any effort.
Disadvantages of Advertising
There are also some demerits of advertising like economic waste. Due to expenditure on publicity the
cost of production increases and it is beard by the consumer ultimately. Another disadvantage is that
it restricts the competition and creates monopoly. It is also argued that advertising creates frustration

Dr. Meghashree A. Dadhich


among the poor people. Sometimes advertisers also misguide the public. So there are the few
disadvantages of advertising. We can say that it is a universal truth that advertising has played very
effective role in expanding the market of various goods.
Other Sources of Mass Communication
As an entrepreneur, it is very important for you to take part in the different meetings and discussions
that can help you in your business. There are different ways to do this; the primary intent of this
article is to identify the purpose of every public meeting you should attend. Most people would
mistake one with another when they talk about expositions, conferences and trade shows. They might
think that all of them are pretty much the same, when in fact they are not. These meetings vary in
purpose and in the process itself. Thus, for an entrepreneur to be effective, he or she has to identify
which one to prioritize in attending to pump up the condition of his or her business.
Exposition – Also known as a ‘trade fair’, this is that type of fair you often see in malls, when a
specific business sector will expose and market their own products. . A trade fair (trade show, trade
exhibition, or expo) is an exhibition organized so that companies in a specific industry can
showcase and demonstrate their latest products and services, meet with industry partners and
customers, study activities of rivals, and examine recent market trends and opportunities. In contrast
to consumer fairs, only some trade fairs are open to the public, while others can only be attended by
company representatives (members of the trade, e.g. professionals) and members of the press,
therefore trade shows are classified as either "public" or "trade only". For example, a mobile phones
fair. Usually you get to see some of the most popular manufacturer brands of mobile phones, with
their displays in booths. They showcase their latest products and services offered. When you engage
yourself in a trade fair, you are exposing the new services and products of your business. It is
important for you to consider factors such as the placement of your booth and the type of booth you
are getting. Remember that you should only attend those trade fairs that will give you a chance to
market your business to the greatest extent
Trade Show – A trade show is also like a fair in that you get to trade and sell items. The booths that
you can find in a trade show consist of different products for sale or for trade. These products have
specific swapping prices or trading prices. This type of fair would allow you to market your own
product, hence it is like a two way street. Thus, if you want to join a trade show, make sure that the
products for trade are not the same as what you are selling. This could just be a way for you to market
and let the customers know what your business has to offer. Giving out banners or cards on what your
business is all about after every purchase or trade can also help.
Conferences – A conference has an entirely different process. It is a meeting of different
entrepreneurs to talk about a specific topic. Most conferences do not include any people who are not
experts on the issues to be discussed. Say for example the speaker of the conference is a phenomenal
doctor who has been in the field and won multiple awards in the field. He will talk about a certain

Dr. Meghashree A. Dadhich


topic to the audience, which is probably made up of co-doctors, such as how to attain success in one
specific study. When you join conferences, it would be a chance for you to learn and also to interact
and make connections with your co-entrepreneurs. Most entrepreneurs actually find their business
partners in conferences.
Seminars and Workshops – These are particularly potent business marketing tools. Seminar can be
used to acquire new relationships. It can be used to add value to existing relationships (with
both customers and prospects). A good seminar presentation has two important advantages
over a one-to-one sales presentation (other than scalability). First, a seminar automatically
positions the presenter as an expert (after all, a congregation has gathered to hear this person
speak). And second, because a seminar is less invasive than a one-to-one sales presentation, a
seminar is easier to promote.

Chapter – 07
PR through Sales Promotion: Price Based and Attention Getting
Promotion
Public Relations and Publicity:
Public relations is an organization’s communications that seek to build good relationships with an
organization’s publics, including consumers, stockholders, and legislators. It includes obtaining
favourable publicity, building up a good “corporate image,” and handling or heading off
unfavourable rumours, stories, and events. Publicity is unpaid communication about an organization
that appears in the mass media. Public relations may consist of writing press releases, holding special
events, conducting and publishing consumer surveys about a product or the company, and efforts to
put a positive spin on negative company news. Unlike sales promotions, public relations activities do
not usually seek a short-term increase in sales. Instead, they try to craft a long-term positive image

Dr. Meghashree A. Dadhich


for the product or the organization. Compared with personal selling, advertising, and sales
promotions, expenditures for public relations are usually low in most organizations. Since companies
do not pay for publicity, they have less control over the publication of good or bad company news.
But this often means that consumers find this type of news source more believable than if the
information were disseminated directly by the company.
Marketing and Non-marketing Public Relations:
The basic rule of public relations is to do something good and then talk about it. PR is crucial to an
organization’s ability to establish and maintain a favourable image.
Non-marketing public relations refers to a company’s messages about general management issues.
When a company makes a decision that affects any of its publics, input from public relations
specialists can help to smooth its dealings with those publics. A company, for example, that decides
to close a plant would need advice on how to deal with the local community. Other examples include
a company’s attempts to gain favourable public opinion during a long strike or an open letter to
Congress published in a newspaper during congressional debates on a bill that would affect a
particular industry.
Marketing public relations refers to narrowly focused public relations activities that directly
support marketing goals. Marketing public relations involves an organization’s relationships with
consumers or other groups about marketing concerns and can be either proactive or reactive.
With proactive marketing public relations, the marketer takes the initiative and seeks out
opportunities for promoting the firm’s products, often including distribution of press releases and
feature articles. It is a powerful marketing tool since it adds news coverage that reinforces direct
promotion activities. Although some publicity happens naturally, more typically a “buzz” needs to be
created by a firm’s publicists. Reactive marketing public relations respond to an external situation
that has potential negative consequences for the organization. The goal in this case is to manage the
flow of information to address concerns so that consumers don’t panic and distributors don’t abandon
the product.
The Internet has expanded the capabilities of the traditional public relations function. Corporate
websites post testimonials from customers, make new product announcements, and respond quickly
to important events. News releases posted on the company website may double as sales vehicles. The
Internet can also be very effective in handling company crises. With a host of Internet news sites,
companies can respond to a crisis online in far less time than other forms of communication such as
press releases or conferences.
Public Relations Objectives:
Public relations specialists need to operate at many levels to ensure that various publics of a company
receive coordinated, positive messages about the firm. These groups include customers, suppliers,
employees, the media, stockholders, and government regulators.

Dr. Meghashree A. Dadhich


Companies that practice integrated marketing communication strategies know that public relations
strategies are best used in concert with advertising, sales promotion, and personal selling in order to
send a consistent message to customers and other stakeholders. As part of the total IMC plan, public
relations departments may perform any or all of the following functions to achieve communications
objectives:
 Public Affairs – Building and maintaining national or local community relations.
 Lobbying – Building and maintaining relations with legislators and government officials to
influence legislation and regulation.
 Investor Relations – Maintaining relationships with shareholders and others in the financial
community.
 Development – Public relations with donors or members of non-profit organizations to gain
financial or volunteer support.
 Location PR – Enhancing the image of a city, region, or country.
 Press Relations – Creating and placing newsworthy information in the news media to attract
attention to a person or product.
 Product Publicity – Publicizing specific products to consumers as well as other organizations.
Public Relations Tools:
Public relations professionals use several tools. They use:
 News,  Written Materials,
 Speeches,  Audiovisual Materials,
 Special Events,  Corporate Identity Materials, and
 Mobile Marketing,  Public Service Activities.
One of the major tools is news. PR professionals find or create favourable news about the
organization and its products or people. Speeches can also create product and company publicity.
Increasingly, company executives must field questions from the media or give talks at trade
associations or sales meetings. Another common PR tool is special events, ranging from news
conferences, press tours, grand openings, and fireworks displays to laser shows, hot air balloon
releases, multimedia presentations and star-studded spectaculars, and educational programs designed
to reach and interest target publics. Recently, mobile marketing—travelling promotional tours that
bring the brand to consumers—has emerged as an effective way to build one-to-one relationships
with targeted consumers. Public relations people also prepare written materials to reach and influence
their target markets. These materials include annual reports, brochures, articles, and company
newsletters and magazines. Audiovisual materials, such as films, slide-and-sound programs, and
video- and audiocassettes, are being used increasingly as communication tools. Corporate identity
materials can also help create a corporate identity that the public immediately recognizes. Logos,
stationery, brochures, signs, business forms, business cards, buildings, uniforms, and company cars

Dr. Meghashree A. Dadhich


and trucks—all become marketing tools when they are attractive, distinctive, and memorable. Finally,
companies can improve public goodwill by contributing money and time to public service activities.
Planning a Public Relations Campaign:
A public relations campaign is a coordinated effort to communicate with one or more of the
organization’s publics. This is a three-step process of:
1. Developing Objectives,
2. Executing, and
3. Evaluating.
The organization must first develop clear objectives for the PR program that define the message it
wants people to hear. The PR specialists must develop a campaign strategy that includes:
 a statement of objectives;
 a situation analysis;
 specification of target publics, messages to be communicated, and specific program elements
to be used;
 a timetable and budget; and
 a discussion of how the program will be evaluated.
Execution of the campaign means deciding precisely how the message should be communicated to
the targeted publics and implementing the decisions. An organization can use a variety of public
relations tools: news conferences, special events, written materials, etc.

One of the barriers to greater reliance on public relations campaigns is the difficulty encountered
when trying to gauge their effectiveness. It is possible to tell if a PR campaign is getting media
exposure, though it’s more difficult to gauge bottom-line impact. In-house assessments, awareness
and preference research studies, and the measurement of print and broadcast coverage generated by
PR activities as well as impression counts can be used in the PR campaign evaluation.
Sales Promotion:
Sales Promotion is the use of short-term incentives to encourage the purchase or sale of a product.
Sales promotions are programs such as contests, coupons, displays, trade shows, samples, premiums,
product demonstrations, or other incentives that marketers design to build interest in or encourage
purchase of a product during a specified time period. Sales promotions are intended to stimulate
immediate action, often in the form of a purchase, rather than to build long-term loyalty. Whereas
advertising and personal selling offer reasons to buy a product, sales promotion offers reasons to
buy now.
Sales promotion geared to marketing intermediaries is called trade promotion. Companies actually
spend about as much on trade promotion as on advertising and consumer-oriented sales promotion
combined. Trade promotion strategies include offering free merchandise, buyback allowances, and

Dr. Meghashree A. Dadhich


merchandise allowances along with sponsorship of sales contests to encourage wholesalers and
retailers to sell more of certain products or product lines.
Sales promotion tools are used by most organizations, including manufacturers, distributors, retailers,
trade associations, and not-for-profit institutions. They are targeted toward final buyers, retailers and
wholesalers, business customers, and members of the sales force. Several factors have contributed to
the rapid growth of sales promotion, particularly in consumer markets. First, inside the company,
product managers face greater pressures to increase their current sales; and sales promotion is viewed
as an effective short-run sales tool. Second, externally, the company faces more competition; and
competing brands are less differentiated. Increasingly, competitors are using sales promotion to help
differentiate their offers. Third, advertising efficiency has declined because of rising costs, media
clutter, and legal constraints. Finally, consumers have become more deal oriented, and ever-larger
retailers are demanding more deals from manufacturers. The growing use of sales promotion has
resulted in promotion clutter, similar to advertising clutter, however. Consumers are increasingly
tuning out sales promotions, weakening their ability to trigger immediate purchase. Manufacturers
are now searching for ways to rise above the clutter, such as offering larger coupon values or creating
more dramatic point-of purchase displays.
Sales Promotion Objectives:
Sales promotion objectives differ widely:
 Increase Short-Term Sales (consumer promotion)
 Build Long-Term Market Share (consumer promotion)
 Encourage Retailers to Carry New Items and Additional Inventory (trade promotion)
 Encourage Retailers to Advertise and Provide More Shelf Space (trade promotion)
 Encourage Retailers to Buy Ahead (trade promotion)
 Increase Sales Force Support (sales force promotion)
 Increase Number of New Accounts (sales force promotion)
Sellers may use consumer promotions to increase short-term sales or to help build long-term market
share. Objectives for trade promotions include getting retailers to carry new items and more
inventories, getting them to advertise the product and give it more shelf space, and getting them to
buy ahead. Sales force promotion objectives include getting more sales force support for current or
new products or getting salespeople to sign up new accounts.
Sales promotions are usually used together with advertising, personal selling, or other promotion mix
tools. Consumer promotions must usually be advertised and can add excitement and pulling power to
ads. Trade and sales force promotions support the firm’s personal selling process.
In general, rather than creating only short-term sales or temporary brand switching, sales promotions
should help to reinforce the product’s position and build long-term customer relationships.

Dr. Meghashree A. Dadhich


Increasingly, marketers are avoiding “quick fix,” price-only promotions in favour of promotions
designed to build brand equity.
Consumer-Oriented Sales Promotion:
The main consumer promotion tools include samples, coupons, cash refunds, price packs, premiums,
advertising specialties, patronage rewards, point-of-purchase displays and demonstrations, and
contests, sweepstakes, and games. Consumer-oriented sales promotions can be classified as either
price-based or attention-getting consumer promotion.
Price-Based Consumer Promotion
Price-based consumer promotions emphasize short-term price reductions or refunds, encouraging
consumers to choose a brand while the deal is on. If used too frequently, however, consumers become
conditioned to purchase the product only at the lower promotional price.
Coupons: A coupon is a certificate that gives buyers a saving when they purchase a specified
product. Coupons can stimulate sales of a mature brand or promote early trial of a new brand.
Redemption rates have been declining in recent years, however, as a result of coupon clutter. Most
major consumer goods companies are issuing fewer coupons and targeting them more carefully. They
are also cultivating new outlets for distributing coupons, such as supermarket shelf dispensers,
electronic point-of-sale coupon printers, or “paperless coupon systems.”
Cash Rebate Offers: A cash rebate is an offer to refund part of the purchase price of a product to
consumers who send a “proof of purchase” to the manufacturer.
Price Packs: A price pack is a reduced price that is marked by the producer directly on the label or
package. Price packs can be single packages sold at a reduced price, or two related products banded
together. Price packs are very effective—even more so than coupons—in stimulating short-term
sales.
Patronage Rewards: A patronage reward is cash or other award for the regular use of a certain
company’s products.
Special Packs: A special pack is a package that gives the shopper more products instead of lowering
its price. A special pack also can be a separate product given away along with another product.
Attention-Getting Consumer Promotion
Attention-getting consumer promotions stimulate interest in and publicity for a company’s products.
Samples: A sample is a small amount of a product offered to consumers for trial. Sampling is the
most effective—but most expensive—way to introduce a new product. About 84 percent of consumer
packaged-goods marketers use sampling as a part of their promotion strategy. Some samples are free;
for others, companies charge a small amount to offset its cost. The sample might be delivered door-
to-door, sent by mail, handed out in a store, attached to another product, or featured in an ad. Samples
can also come with the morning newspaper, in a sample pack, or via the Internet.

Dr. Meghashree A. Dadhich


Premiums: A premium is a good offered either free or at low cost as an incentive to buy a product. A
premium is not the product being promoted. It is used as an incentive to encourage purchase of the
featured product. A premium may come inside or outside the package, or through the mail.
Advertising Specialties: An advertising specialty is a useful article imprinted with an advertiser’s
name, given as a gift to consumers. Typical items include pens, calendars, key rings, matches,
shopping bags, T-shirts, caps, nail files, and coffee mugs. In a recent study, 63 percent of all
consumers surveyed were either carrying or wearing an ad specialty item. More than three-quarters of
those who had an item could recall the advertiser’s name or message before showing the item to the
interviewer.
Point-of-Purchase (POP) Promotions: A point-of-purchase promotion is a display or
demonstration that takes place at the point of purchase or sale. Unfortunately, many retailers do not
like to handle the hundreds of displays, signs, and posters they receive from manufacturers each year.
Manufacturers have responded by offering better POP materials, tying them in with television or print
messages, and offering to set them up.
Contests, Sweepstakes, and Games: Contests, sweepstakes, and games are promotional events that
give consumers the chance to win something—such as cash, trips, or goods—by luck or through
extra effort. A contest calls for consumers to submit an entry—a jingle, guess, or suggestion—to be
judged by a panel that will select the best entries. A sweepstakes calls for consumers to submit their
names for a drawing. A game presents consumers with something—bingo numbers, missing letters—
every time they buy, which may or may not help them win a prize.
Trade-Oriented Promotion: Manufacturers direct more sales promotion dollars toward retailers and
wholesalers (78 percent) than to consumers (22 percent). Trade promotion can persuade resellers to
carry a brand, give it shelf space, promote it in advertising, and push it to consumers. Shelf space is
so scarce these days that manufacturers often have to offer discounts, allowances, buy-back
guarantees, or free goods to retailers and wholesalers to get products on the shelf and, once there, to
stay on it. Manufacturers use several trade promotion tools. Many of the tools used for consumer
promotions—contests, premiums, displays—can also be used as trade promotions.
Discounts: A discount is a straight reduction in price on purchases during a stated period of time. This
is also called price-off, off-invoice, or off-list. The discount could be based on the volume of the
product ordered.
Allowances: An allowance is promotional money paid by manufacturers to retailers in return for an
agreement to feature the manufacturer’s products in some way. An advertising
allowance compensates retailers for advertising the product. Adisplay allowance compensates them
for using special displays.
Conventions and Trade Shows: Many companies and trade associations organize conventions and
trade shows to promote their products. Firms selling to the industry show their products at the trade

Dr. Meghashree A. Dadhich


show. A trade show is an event at which many companies set up elaborate exhibits to show their
products, give away samples, distribute product literature, and troll for new business contacts. Trade
shows are major vehicles for manufacturers to show off their product lines to wholesalers and
retailers.
Other Programs: Manufacturers may offer free goods, which are extra cases of merchandise, to
resellers who buy a certain quantity or who feature a certain flavour or size. They may offer push
money—cash or gifts to dealers or their sales forces to “push” the manufacturer’s goods. Most
retailers also charge manufacturers slotting fees—payments demanded by retailers before they will
accept new products and find “slots” for them on the shelves. Manufacturers may also give retailers
free specialty advertising items that carry the company’s name, such as pens, pencils, calendars,
paperweights, matchbooks, memo pads, and yardsticks. For more expensive and highly complex
products, manufacturers often provide specialized training for retail salespeople. This background
helps salespeople explain features, competitive advantages, and other information to consumers.
Training can be provided in several ways: A manufacturer’s sales representative can conduct training
sessions during regular sales calls, or the firm can distribute sales literature and videocassettes.

Dr. Meghashree A. Dadhich

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