Harsha-Business Strategy

ABSTRACT

The advertising industry is one of the most competitive industries today. Further, the increasing consciousness of the consumers and their rapidly changing preferences has made the task of attracting them very complex for the companies. So, the advertising firms who do this task for them have to differentiate each add in terms of the conveying power, attractiveness, conciseness, etc. This project makes an attempt to analyze the pros and cons of a new kind of strategy called 'presentation advertising. The macroeconomic

analysis is done using Pestel and Porter's framework while the strategy specific analysis is done using RCCDC Model and SWOT Analysis. In order to classify the product with respect to market growth and market share, BCG Matrix has been used; and to decide product and market growth strategy, Ansoff's Matrix has been used. Further an in-depth analysis of the product has been carried on three levels. Finally, identification of strategic gap by Harsha Media and challenges it needs to meet has been enumerated.

Keywords: Pestel; Porter's, RCCDC Model, SWOT Model, BCG Matrix ;Ansoff's

Introduction to Advertising Industry

Advertising is a form of communication used to persuade an audience (viewers, readers or listeners) to take some action with respect to products, ideas, or services. Most commonly, the desired result is to drive consumer behavior with respect to a commercial offering, although political and ideological advertising is also common. Advertising messages are usually paid for by sponsors and viewed via various traditional media; including mass media such as newspaper, magazines, television commercial, radio advertisement, outdoor advertising or direct mail; or new media such as websites and text messages.

Commercial advertisers often seek to generate increased consumption of their products or services through "Branding," which involves the repetition of an image or product name in an effort to associate certain qualities with the brand in the minds of consumers. Non-commercial advertisers who spend money to advertise items other than a consumer product or service include political parties, interest groups, religious organizations and governmental agencies. Nonprofit organizations may rely on free modes of persuasion, such as a public service announcement (PSA).

Types of Advertising:-

Virtually any medium can be used for advertising. Commercial advertising media can include wall paintings, billboards, street furniture components, printed flyers and rack cards, radio, cinema and television adverts, web banners, mobile telephone screens, shopping carts, web popups, skywriting, bus stop benches, human billboards, magazines, newspapers etc.

* Digital Advertising: - The TV commercial is generally considered the most effective mass-market advertising format, as is reflected by the high prices TV networks charge for commercial airtime during popular TV events.

* Infomercial: - An infomercial is a long-format television commercial, typically five minutes or longer. The word "infomercial" combining the words "information" & "commercial".

* Radio advertising: - Radio advertising is a form of advertising via the medium of radio. Radio advertisements are broadcast as radio waves to the air from a transmitter to an antenna and a thus to a receiving device.

* Online advertising: - Online advertising is a form of promotion that uses the Internet and World Wide Web for the expressed purpose of delivering marketing messages to attract customers.

* Physical Advertising/ Press advertising: - Press advertising describes advertising in a printed medium such as a newspaper, magazine, or trade journal.

* Billboard advertising: - Billboards are large structures located in public places which display advertisements to passing pedestrians and motorists.

* In-store advertising: - In-store advertising is any advertisement placed in a retail store.

Characteristics of Advertising Industry

Some of the major characteristics of the advertising industry are the following:-

* It is a highly competitive industry in which firms fight fiercely against each other.

* The industry is driven my innovative ways of advertising , mainly which grab customer attention and are successful in creating a space in their minds.

* It is a very fragmented industry and consists of basically three types of firms i.e. big size, mid-size and small size firms depending on the market share they hold.

* The industry is regulated by agencies Advertising Agencies Association of India & Advertising Standards Council of India, who frame the guidelines/regulations and monitor the conduct of all advertising agencies.

* The barriers of entry in this industry are not high which leads to a number of firms entering in this industry to grab some market share.

Strategies adopted by top players

* Cost leadership strategy- high level of expertise, efficient distribution channels, access to capital required to make new investments, greater market penetration are some of the characteristics that make enable large advertising firms to follow cost-leadership strategy.

* Customer retention strategies- large advertising firms focus more on retaining their high-profile clients because it is 4 times more profitable to get more business from a current client rather than dealing with a new client.

* Core competency strategy- large enterprises used to leverage on their core competency in order to gain more market share.

* Differentiation strategy- large advertising firms have high budgets, access to scientific research, skilled and creative product development teams to come up with new innovative products/ services which can differentiate them from their competitors in order to maintain their market share

Strategy adopted by mid- size players

* Focus strategy- this strategy allows mid-sized firms to focus more on a narrow segment and within that segment they try to achieve either cost or differentiation advantage. Since the mid-size advertising firms have small budgets so they always try to follow cost cutting methods in order to make profits.

* New business development plan- mid-size companies are much quicker in adapting to fresh ideas rather than large firms. They work with