Role of Advertising in Industrial Marketing

Advertising is the most preferred promotional tool in the consumer market  rather than in the industrial market. It is preferred less by the industrial  marketers compared to personal selling as they get to meet the customers  personally and understand their needs better in personal selling. But still  advertising is used to a good extent by the industrial marketers to assist their  sales force and intermediaries to generate more leads. Advertising plays an  important role in industrial marketing strategy by supporting and supplementing  personal selling efforts. The advertising budget for industrial goods is far less  compared to that of consumer goods. But, to have an increased efficiency and  effectiveness of the overall marketing strategy, industrial marketer should have  an integrated and well planned advertisement strategy that blends properly with  personal selling efforts.

Before understanding the role of advertising in industrial marketing, we must be  aware that there are certain forces that shape and influence organizational  buying decisions. Industrial purchasing decisions are typically joint decisions  that insist an industrial marketer to focus on all the individuals involved for a  particular purchase. Studies have also shown that an industrial salesperson does  not reach even six to seven out of ten purchase decision influencers. In such  cases, advertisement that becomes the only means of communicating fills the  gap by reaching important buying influencers who are sometimes inaccessible to  the industrial sales force. It facilitates the company by enhancing its brand  image, increase the salesperson’s opportunity to create a sale.

Objectives of Industrial Advertising

Any industrial marketer uses advertising as a promotional tool as it performs so  many functions that help him to achieve the following objectives:

  1. Create awareness: The industrial advertising creates awareness about a supplier  or his products to the potential industrial buyers who are unaware about the  availability of their products in the industrial markets.
  2. Reaching inaccessible places: There are places that are not reachable by the  company sales force and there are important decision makers for purchase of  industrial products who cannot be met by the sales force. These places could be  reached easily through advertising. Thus, advertising in trade journals, business  magazines that are read by R&D Managers, engineers help the companies to  reach their target audience.
  3. Improve sales: Advertising helps salespersons to improve their sales by  increasing their sales efficiency and effectiveness as people are already aware of  their company, products, etc.
  4. Reduce cost: A single advertising reaches a vast number of people that comes  out cheaper than a single salesperson meeting so many people personally and  explaining them in details about the company’s products. Thus, advertising not  only reduces cost but also saves time of the company.

Besides above, some other objectives of advertising are to provide relevant  information to the potential buyers, influence their attitudes, remind them about  a product or a company, support and motivate the distribution channel members  and sales agents.

Effectiveness of Industrial Advertising

The evaluation of industrial advertising is a very complex task. Its effectiveness  is measured by evaluating its performance against the advertising objectives.  Advertising is said to be effective if its objectives are reached with the given  amount of budget specified for it. For instance, when a product is sold solely  depending on the advertising, then the effectiveness of advertising is determined  by comparing the cost of advertising with the volume of sales generated.  Similarly, when the objective is to generate new leads, then the number of  queries received forms the basis for evaluating advertisement effectiveness. For  example, the advertising cost effectiveness for a business publication is  measured by using the formula:

Cost per thousand = Cost per page / Circulation in thousand

There are certain areas which need to be measured in order to evaluate  advertising effectively. They include measuring the target markets where the  advertising is aimed and the extent to which the advertising succeeded in  reaching the target markets, measuring the motives of target audience before and  after advertising, measuring the extent to which the advertising message is  registered, and measuring the extent to which different media succeeded in  reaching the target market with the given message. Knowledge, recall,  awareness, preference, recognition etc., are some other specific types of  evaluations required to measure the advertising effectiveness.

Limitations of Industrial  Advertising

Though advertising is assisting the industrial marketers to reach their goals in  effective way, there are certain limitations of industrial advertising. The  industrial marketers have to be aware of such limitations as it would help them  to utilize the benefits of advertising to its maximum even within the given limits.

The limitations of industrial advertising are:

  • Industrial advertising cannot substitute personal selling but it can  definitely support, supplement and complement that effort.
  • Advertising can and should be used only for creating awareness and  providing information. Its purpose would be lost and the cost increases if  it tries to give all the details. Providing exhaustive information, objection  handling, convincing and converting a prospect into a customer that  consumes lot of time should be allowed to be handled by the direct sales  force team.
  • Advertising cannot create any product preference as this requires live  demonstration with explanation.
  • Advertising cannot achieve the task of creating conviction and purchase.  Such tasks are achieved by personal selling.

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