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A Study On The Correlation Between Branding And

Advertisement In FMCG Sector.

Submitted To:
Dr. Shitala Tripathi
Sr. Lecturer & Research Coordinator
School of Management Sciences Lucknow

Submitted By:

Ray Bhanu Pratap Singh

Mentor Name: Mr. Vikram Singh, Lecturer, SMS Lucknow
Batch: PGDM (Marketing) 2009-11
Date: Saturday, August 28, 2010

A Study On The Correlation Between Branding And

Advertisement In FMCG Sector.

1. Objective/ Relevance of the study:

Branding and advertisement are one of the main activities carried out by any organization and when
it comes about the companies of FMCG sector, the importance of these two activities can be easily

This research work is carried out with objective:

• To study the degree of correlation between the advertisements carried out by a company and
its associated brand image.
• To ascertain the impact of high/low advertisement on the brand positioning and market
• To understand the advertisement strategy of some key FMCG players and also to assess the
relative performance of other branding strategies adopted by them.
• To analyze the role and scope of online advertising and brand positioning on the
performance of the concerned product of the company.

This work can serve Industry in the way as:

• It can be used to assess the trends in advertising expenditure and corresponding market
• It can also serve as a parameter for measurement of the relative degree of branding by a
given level of advertisement exposure.
• It can also be used to visualize the scope of online marketing of FMCG sector products
through social networking websites.

In academics, the work can prove itself a milestone by:

• Providing a practical exposure to the causes behind increasing advertisements expenses of
FMCG sector companies.
• Giving a glimpse of the relationship between the advertisement and branding.
• Determining the scope of technology (i.e. through online promotion of product), in
advancement of the branding.
• To clarify the basic concept of brands, positioning of product, advertisement, market share
and market penetration.

2. Literature Review-
The Indian FMCG sector is the fourth largest sector in the economy with a total market size in
excess of US$ 13.1 billion. It has a strong MNC presence and is characterised by a well established
distribution network, intense competition between the organised and unorganised segments and low
operational cost. Availability of key raw materials, cheaper labour costs and presence across the
entire value chain gives India a competitive advantage.( Ghalla Bhansali Stock Brokers Pvt. Limited, research
report published on their website)
The FMCG market is set to treble from US$ 11.6 billion in 2003 to US$ 33.4 billion in 2015.
Penetration level as well as per capita consumption in most product categories like jams, toothpaste,
skin care, hair wash etc in India is low indicating the untapped market potential. Burgeoning Indian
population, particularly the middle class and the rural segments, presents an opportunity to makers
of branded products to convert consumers to branded products. (

There is immense growth opportunity in FMCG sector and there exists a strong relationship
between branding and advertisement expense/ activities of a company. With the growing awareness
that brands are one of a firm's most valuable resources (Srivastava, Fahey, and Christensen, 2001),
branding has emerged as a top management priority in the past decade. In this context, corporate
branding strategies are gaining more and more importance. Corporate brand (CB) is thereby
understood as being a product of top management and its ability to propagate this vis-à-vis its stake-
and shareholders so as to form the interface between self portrayal and external perception of the
organization (Kiriakidou and Millward, 2000; Balmer, 2001). Given its highly competitive nature,
much has been written about corporate brand management (CBM) and its impact on consumer
behavior and its correlation with the advertising (e.g., Yoon, Gürhan-Canli, and Schwarz, 2006).

3. Research Methodology-
This work is to be carried out in form of exploratory research. Exploratory research is a type of
research conducted because a problem has not been clearly defined. Exploratory research helps
determine the best research design, data collection method and selection of subjects. Given its
fundamental nature, exploratory research often concludes that a perceived problem does not
actually exist.

(a) Data Sources-

(i) Source of Data

The research work relies on primary data and is collected from:
• Profit and Loss account of various FMCG firms. (
• Branding positioning of the firms. (from the website of brand rating agencies)
• Market share of the firms.(through research reports)
• Brand rating of individual companies.(from rating agencies)

(ii) Span of Study/Study Period

Research work is carried out for the period of year 2004 to year 2010.

(iii) Elements to be considered as Data

Following elements of the data source is to be considered as data source:
• Advertisement expenses by the firms
• Brand ratings of the firms.
• Market share of the firms.
• Online advertisement expenses.

(iv) Time and Date of the data depends on the moment it will be collected .

(b) Hypothesis-
Null Hypothesis:
H0: There is no correlation between the advertisement and branding (Brand positioning) of a
FMCG company

Alternate Hypothesis:
H1: There is a correlation between the advertisement and branding (Brand positioning) of a FMCG

© Tools/Models for Hypothesis Testing-

Following tools are to be applied for the testing of hypothesis:
• Spearman’s Rank Correlation Method.
• Chi- Square Test

4. Chapter Plan:
The chapter plan for the research is as follows:

Title Page
List of Table graphs and Charts

Chapter I: Introduction to the study

Chapter II: Research Methodology

Chapter III: Data collection and analysis

Chapter IV: Testing of Hypothesis

Chapter V: Findings and Conclusion

Chapter VI: Suggestions