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Looking below the line

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Vijay Singh MD & CEO, 141 Sercon

Why is BTL gaining more importance these days?
The BTL industry has been around for a very long time, it’s just that now there is a little more recognition that what was earlier very fragmented is actually a fairly structured BTL business. Traditionally brand managers have been spending money on three broad areas -- one is ATL, second is marketing services or BTL and the third being PR.

Earlier, rather than it being a structured as marketing services, people used to look at it as promotions being done separately, shop-front activities being done differently, product placements, etc. been done differently, etc. Now more and more brand managers are clubbing it into a single BTL format. They want an agency that can possibly give a solution for all that.

Is the increasing presence of BTL felt only in the FMCG and the durables market?
No. The B2B business already has the majority of the spend. What was not happening was that FMCG in terms of percentage was not spending as high a percentage as what they are doing now on BTL. Also BTL is not just about niche products. Look at soap, it is definitely not niche as everyone uses it. If you were to reduce the BTL spend on soaps, let’s say you don’t do any shop-front activities, you don’t do any inside the shop activities, so and so forth, you will need to bring down your sales focus.

What kind of ATL and BTL mix would work for a startup operation?
It is dependent on the product category and the kind of consumer you have. A startup I am assuming doesn’t have a lot of money so a startup typically would want to ensure that whatever the expense it gets some quick results that is where a BTL would come in. But if it is a startup with a lot of money, for instance, someone got lucky and got a lot of funding and is first looking at building the brand and then do sales then I would assume that he would first want to use some TV commercials, a lot of focus on print ads then from there start doing demand generation.

How many companies are spending a substantial amount of money on BTL these days?
In India our current estimate is on an average it is about 45% of the spend on BTL and I am including areas such as research marketing, a little bit of digital, etc.

The difference with ATL is that the vehicles of delivery are fairly very well established. For e.g., out of a great idea and great strategy, I create a great TVC and I give it to established television channels to run it on their vehicles, and nothing goes wrong.

When it comes to BTL, I still need to have a great strategy and a great creative idea but I need to implement it on ground. I’ll need to do promotions, I’ll need to do road shows, and I’ll need to do one-on-one interaction. And if I don’t implement it well, the possibility of a BTL campaign backfiring is very high. If I am a consumer and the person interacting with me doesn’t do a great job, that particular campaign will fall flat on its face. So the moments of truth on a BTL are too many.

What is the ROI on these BTL initiatives?
If you ask an ATL guy, he is normally going to talk in terms of increase in brand recall. If you talk to a BTL person he’ll give you hard numbers, in terms of revenue increase.

Recently, for example, we ran the “Grand Kerala Shopping Festival” campaign with the Kerala government and they spent close to Rs 15 crore on the entire festival. It was a six- month initiative, and at the end we were able to increase the VAT collection of the state to the extent of approximately Rs 75 crore. This is hard money-to-money comparison but we also had to built the brand and do a lot of ATL with that campaign. The deal is if you cannot really measure the return on investment on a BTL campaign, then it’s not really a good campaign.

As compared to ATL, what is one big advantage and disadvantage of BTL?
The big disadvantage is that BTL is not the best information vehicle, a mass information vehicle. If the idea is just to convey the brand, then BTL is not the right solution. Turn it on its head, if the objective is to create a conversation about the brand and to get engagement with the consumer then BTL is the right solution.

While there’s nothing stopping you from launching a conventional mass-media based strategy, which would only help you in your brand creation, according to experts, it might be a good idea to initiate a BTL campaign and check which way the wind would blow as per your sales.

“We are an innovation driven company, so we are continuously launching new products. Our products have new and exciting features, which are required to be communicated to the consumer and therefore require investment in the form of above-the-line (ATL) AND BTL”, says V Ramachandran, director, marketing, LG Electronics India.

Besides fine-tuning the product and brand, another big reason for a startup to favorably consider this tool is the cost factor. BTL offers a wide spectrum of dirt cheap to more expensive activities, starting from distributing pamphlets, brochures, newspaper inserts, etc. to holding seminars and product launches. “Unlike traditional advertising, the impact of BTL activities is far more measurable, since it is less about brand building and more about increasing sales”, says Singh.

Besides new products and startups, another natural fit are companies with a niche, but geographically spread-out customer-base, such as that for precision engineering tools. In such cases, a seminar or trade show may bring you a much bigger bang for your buck than a TV ad. Sometimes, even if the product can have a national appeal, a company may choose to start off with just one town or city. BTL options such as pamphlets, mall events etc. fit the bill in this case. “We have always (nationally as well as internationally) been more of a BTL-led brand, given that our customers are specific and not mass market,” says Chaturvedi of Baskin Robbins. “In India, the popular and regular activities are leaflets, cross-promotions with retail chains or outlets and school contact progrmmes,” he says.

The BLT industry is fragmented with many small players dotting the market and doing a bit of everything. The industry size was estimated at Rs 13,200 crore in 2006. However, despite all the hype, BTL initiatives cannot be the answer to all your marketing requirements. Its biggest strength, an extremely focused approach, is also what prevents it from being a complete marketing solution. Besides the absence of cost-effective scalability to address a mass market, BTL activities may also require a higher involvement of the organization than an ad-based approach.

Comments (7)Add Comment
Turning Your Words into Wealth
written by marketing strategy, June 14, 2010
Marketing tip: Do you talk about your client's need and forget your own company's accomplishments in your ad?
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Votes: +3
Turning Your Words into Wealth
written by marketing strategy, May 18, 2010
Marketing tip: Do you talk about your client's need and forget your own company's accomplishments in your ad?
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Votes: +3
Add a mobile based, 'Below-The-Line' Brand communication channel to your Retail outlets.
written by Quantama, January 31, 2010
Benefits Include:
-Ability to connect to previously unknown/unreachable customer base.
-Targeted touch points and reciprocation with each individual consumer.
-Ability to add a hip new mobility channel to the existing marketing portfolio increasing brand recall.
-Drive up Same Store Sales through Increasing Conversion.
-Insight and Real Time Intelligence of current Footfall.
-Single Loyalty Program across Formats.
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written by niraj shah, April 18, 2009
btl budgets in our country are also on the increaselook at telecom industry.they spend more on btl than atl'
why telecom look at footwear,apparela or even retail the answer is in favour of btl.
to reach to the consumer its eveident to take path thru btl.
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written by Vijay Singh, November 06, 2008
Hi Anil,
A short recession is of great advantage to below the line marketing services for a few basic reasons ;
1. Brands move away from typical brand building strategies and start to focus more on marketing services which ensure a sales uplift and that is where BTL scores.
2. As spends go down, brands look at focussing spending on targetted TG and hence turn to BTL strategies like direct and one on one experiential marketing.
3. Retention becomes more critical than new customers and hence focus on CRM.

US leads the world in terms of BTL spend percentages, where-in the promotional spends are higher than the ATL spends. I have a collection of reports and research on my blog and would suggest you take a look at thoes.

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written by Anil Malik, October 27, 2008
What will be the impact of recent recession on marketing activities especially BTL activities? I would request if you can be more specific towards US market and for established brands like Coke/ Pepsi/Levers etc.
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Asst, Manager
written by syed, September 16, 2008
As compared to AtL, what is the advantage and disadvantage of BtL?
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