•Surrogate Advertising is a form of advertising which is used to promote banned products like Cigarettes and alcohol, in the disguise of another product.•copying the brand image of one product to promote another product of the same brand.

Effectiveness of SA-SA impact a consumers buying decision as well as also influence leading liquor brand sales.

In June 2002, the Information and Broadcasting (I&B) Ministry of India ordered leading television (TV) broadcasters to ban the telecast of two surrogate ads1 of liquor brands, McDowell's No. 1 and Gilbey's Green Label.The Ministry also put some other brands - Smirnoff Vodka, Hayward's 5000, Royal Challenge Whiskey and Kingfisher beer - on a 'watch list.‘By August 2002, the I&B Ministry had banned 12 advertisements. Leading satellite TV channels, including Zee, Sony, STAR and Aaj Tak were issued show-cause notices asking them to explain their reason for carrying surrogate liquor advertisements.The channels were asked to adhere strictly to the Cable Television Regulation Act 1995 (Cable TV Act, 1995).2 As a result, Zee and STAR stopped telecasting the advertisements; Aaj Tak and Sony soon followed suit. In addition, the I&B Ministry hired a private monitoring agency to keep a watch on all advertisements for violations of the Act.

THE INDIAN LIQUOR INDUSTRY

IMFL

Country made liquor

The liquor industry was heavily regulated by the government. Companies were not allowed to expand capacity without prior approval from the concerned state government. The distribution of liquor was also controlled in many states through auction system, the open-market system and the government-controlled system.States following the open-market system gave companies freedom to choose their distributor and to determine the price and the discounts. were around 25,000-27,000 licensed retail sales outlets in the country, in addition to the bars, pubs, hotels and restaurants serving liquor.

Gujarat

Manipur

Mizoram

Nagaland

Lakshadweep

GENDER WISE CONSUMPTION OF ALCOHOL:-

Male = 40-50% Female 1%

CURRENT SCENARIO United spirits with about 60 % of market share

in IMFL is the undisputed leader. Radico Khaitan who entered the IMFL space some 8 years back has already cornered

12 % market share and gaining. Other players include Mohan Meakin (9%),

Jagatjit (8.5%), etc. High prices took the froth out of the Indian

spirits industry last fiscal. The beer market, which was guzzling growth of 13% in recent years, inched up just 3-4% in the year ended March, its slowest growth in eight years.

Liquor marketers too were sobered by steep taxation in several key markets that tempered growth to 8% in 2011-12, the first time it slipped into single-digit growth in decades.

MARKET SHARE

THE DEABATELiquor producers felt that while the government allowed them to do business, it did not allow them to do so in a profitable manner. Liquor companies argued that the ban would severely affect the sales. The said that TV was the most effective medium of advertising for these products and thus the restriction would hamper brand building.According to a WTO agreement signed in March 2001, MNCs had unrestricted license to sell their products. After the ban, these MNCs would not have access to the quickest and most effective form of advertising - the TV. Thus MNCs who had recently entered the Indian industry were expected to face difficulties in building their brands. The ban would also affect the entry decisions of MNCs that were planning to enter the Indian liquor industry.

some analysts argued that the ban would not affect the established domestic players severely. It would only affect new launches and new brand building activities of these companies.Players who already had very strong brands (E.g. McDowell No. 1, KingFisher, Hayward's and Royal Challenge) would not be affected by the ban.On an average, liquor companies spent about 10-12% of sales revenue on advertising, including direct consumer promotions programs; sponsorships; and print and electronic media advertisements. On TV alone, companies reportedly spent about 3-4% of sales revenue. This meant that after the ban, companies could save 3-4% sales or gain in margins.McDowell's operating margins ranged between 5-7% and after the ban, were expected to increase by 50%.

Industry watchers felt that since distribution and reach would become more vital after the ban, smaller companies might be acquired by the larger ones for their distribution network, if not for their brands.Some critics observed that while the government imposed many restrictions on the liquor company; it also earned a significant portion of its revenues (Rs 200 billion in 2000 for the whole country) through levies on liquor sales.The issue of surrogate advertising involved even media companies, as they had to forego substantial revenues as a result of the ban. According to broadcasters, the government should put in place a 'reasonable' policy, which somehow struck a balance between the social and monetary aspects of the business of alcohol.

Q.=1

„By banning advertisements for liquor, the government is trying to disassociate itself from the social evils associated with alcohol consumption.‟ Critically comment on this statement in light of the ban on direct and surrogate advertisements for liquor.

Ans of Q. n. -1

In India, alcohol is not socially permitted . We usually think that alcohol affects our health & moral in society . So this is the right decision of government to ban the advertisement for liquor.Direct advertisement always persuade people to buy but surrogate advertisement only make us aware about the brand.

Q.=2

Do you think surrogate advertisements by liquor companies were banned because of the criticism they received? Give reasons to support your answer. Also, discuss the advantages and disadvantages of using surrogate advertisements (for a liquor company in particular and also for any other type of company).

Ans of Q.n. -2.

Disadvantage: It may or may not be impact on liquor brand

The purpose of surrogate advertisement is to let customers be familiar with the product without violating the ban on direct advertising while projecting that the company is socially responsible. So it should not be banned.

ADVANTAGE: Increase government revenue through sale.

Q.=3 As a part of a team responsible for the marketing of a leading liquor brand, what measures would you suggest to overcome the limitations imposed due to the ban on surrogate advertising? Does the use of „socially responsible‟ advertisements go against the interests of a liquor company? Analyze.

Ans of Q.n.-3. MARKETING STRATEGIESE FOR LIQUOR

We will mainly work for brand building & recall.On the basis of our budget we can use the following tools:

A) through mineral water & soda.B) sponsoring events like racing, Golf tournament , sports ,

cultural, movie , music show & other program which attracting youths

Promote the brand through the CSR.Free gifts of Golf accessary (bag , cap, t-shirt & gloves) with brand name.Sales promotions in bar & restaurants.Best couple competition at honey moon place & popular beach .