Integrated Marketing Communications: Advertising, Promotions. And Other MarCom Tools

• Integrated Marketing Communications: Advertising, Promotions. And Other MarCom Tools

LEARNING OBJECTIVES

• Appreciate the variety of marketing communications tools, and how they work together to accomplish communication objectives.

• Understand the nature, importance, and features of integrated marketing communications.

• Describe the concept of brand-equity enhancement and the role of marketing communications in facilitating this objective.

LEARNING OBJECTIVES

Appreciate the variety of marketing communications tools, and how they work together to accomplish communication objectives

Understand the nature, importance, and features of integrated marketing communications

Describe the concept of brand-equity enhancement and the role of marketing communications in facilitating this objective

LEARNING OBJECTIVES

• Comprehend the factors that determine how different marketing communications elements are effectively combined.

• Discuss the primary decision spheres involved in managing the marketing communications process.

• Know the major activities involved in formulating advertising strategy.

Comprehend the factors that determine how different marketing communications elements are effectively combined

Discuss the primary decisions spheres involved in managing the marketing communications process

Know the major activities involved in formulating advertising strategy

LEARNING OBJECTIVES

• Recognize the role of sales promotion, appreciate the reasons why this form of marketing communication has experienced rapid growth, and know the tasks that it can and cannot accomplish.

• Evaluate the nature and function of public relations.

• Appreciate sponsorship marketing and the practices of event marketing and cause-related marketing

Recognize the role of sales promotion. Appreciate the reasons why this form of marketing communication has experienced rapid growth, and know the tasks that it can and cannot accomplish

Evaluate the nature and function of public relations

Appreciate sponsorship marketing and the practices of event marketing and cause-related marketing

LEARNING OBJECTIVES

• Understand the role, importance, and growth of point-of-purchase communications.Understand the role, importance, and growth

of point-of-purchase communications

AdvertisinAdvertisingg

SalesSalesPromotionPromotion

SalesSalesPromotionPromotionP-O-PP-O-PP-O-PP-O-P

SponsorshipSponsorshipSponsorshipSponsorship

PublicityPublicityPublicityPublicityPersonalPersonalSelling Selling

MarCom Mix

THE TOOLS OF MARKETING COMMUNICATIONS

• Person-to-person communication in which a seller informs and educates prospective customers and attempts to influence their purchase choices.

Personal Selling

PublicityPublicityPublicityPublicityPersonalPersonalSelling Selling

PersonalPersonalSelling Selling

MarCom Mix

• Nonpersonal communication that is paid for by an identified sponsor and involves either mass communication and other media or direct-to-consumer communication via direct mail.

Advertising

AdvertisingAdvertising

PublicityPublicityPersonalPersonalSelling Selling

MarCom Mix

• Non-personal communication to a mass audience that is not directly paid for by the company.

Publicity or Public Relations

MarCom Mix

• All the marketing activities that attempt to promote immediate sales of a product.

Sales Promotion

SponsorshipSponsorship

MarCom Mix

• The practice of promoting the interests of a company and its brands by associating the company with a specific event.

Sponsorship

SalesSalesPromotionPromotionP-O-PP-O-P

MarCom Mix

• Includes all signage (displays, posters, signs, shelf cards, and other visual materials) designed to influence buying decisions at the point of sale.

Point-of-Purchase (P-O-P)

Advertising

SalesPromotion

SponsorshipSponsorship

PublicityPersonal

Selling Personal

Selling

MarCom

IntegratedMarketing

Communications

MarCom

IntegratedMarketing

Communications

• Integrated Marketing Communication (IMC)A system of

managing and integrating marketing communication elements with the result that all elements adhere to the same message

KEY PARTICIPANTS IN MARKETING COMMUNICATIONS

• Requires careful study of customers’ communication usage pattern and information needs

• Communication media (contact points) is dictated by the customer’s needs and behavior

• Involves an outside-in approach to decision making

Starts with the CustomerStarts with the Customer

Key Aspects of Integrated Marketing Communications

• Use all forms of communication and all sources of contact

• Communication media (contact points) is dictated by the customer’s needs and behavior

• Involves utilization of communication outlets that are appropriate for reaching the target audience

Use Any Form of Relevant ContactUse Any Form of Relevant Contact

• Another key aspect of IMC is the need for synergy

• All communication elements should convey the same, unified message, otherwise consumers will be confused

Achieve SynergyAchieve Synergy

• Successful marketing requires building a relationship between the brand and the customer

• Entails repeat purchase and loyalty

• More profitable to build and maintain relationships than to continuously search for new customers

Build RelationshipsBuild Relationships

• More than awareness or attitude changes but must include behavioral changes

• Moving people to action

Affect BehaviorAffect Behavior

3. Expanded efforts to assess return on investment

2. Increased reliance on highly targetedcommunications methods

1. Reduced Dependence in Mass-Media Advertising

Key Changes in MarCom Practice Resulting from the IMC Thrust

• Figure 12.1

THE MARCOM CHALLENGE: ENHANCE BRAND EQUITY

BrandKnowledge

Brand Recognition

Brand Recall

AttributesAttributes

BenefitsBenefits

OverallEvaluation(Attitude)

Types ofBrand Associations

Favorability, Strength, and

Uniqueness of Brand Association

Favorability, Strength, and

Uniqueness of Brand Association

BrandAwareness

BrandImage

BrandBrand

AwarenessAwareness

BrandBrand

ImageImage

• A brand possesses equity to the extent that consumers are familiar with the brand and have stored in memory favorable, strong, and unique brand associations

Brand Equity

BrandBrand

AwarenessAwareness

• Whether a brand name comes to mind when consumers think about a particular product category and the ease with which the name is evoked

BrandBrand

ImageImage

Brand Awareness

BrandBrand

ImageImage

• The associations that come to mind when contemplating a particular brand

• Brand association - the particular thoughts and images that a consumer has about a brand

BrandBrand

AwarenessAwareness

Brand Image

ObjectivesObjectivesObjectivesObjectives

Nature of the ProductNature of the ProductNature of the ProductNature of the Product

Life-cycle StageLife-cycle StageLife-cycle StageLife-cycle Stage

Competitive ActionsCompetitive ActionsCompetitive ActionsCompetitive Actions

• Who is the intended market?

• Business-to-business market or consumer market?

• Understanding of the product’s target market

MarketMarket

BudgetBudgetBudgetBudget

Push vs. PullPush vs. PullPush vs. PullPush vs. Pull

DETERMINING AN APPROPRIATE MIX OF IMC TOOLS

ObjectivesObjectives

MarketMarketMarketMarket

• What are the objectives?

• Do we want to create product category wants or brand preference?

• Insert Figure 12.2

The Hierarchy of Effects

Purchase

Purchase Intention

Attitude

Beliefs/Knowledge

Awareness

Unawareness

Nature of the ProductNature of the Product

• What is the nature of the product?

• Business-to-business products versus consumer goods

Life-cycle StageLife-cycle Stage

• What is the product life-cycle stage?

• New product versus a mature product

Competitive ActionsCompetitive Actions

• What are competitors doing?

• Does the competition allow trade allowances and, if so, how large?

• What is the available budget for promotion?

• Do we emphasize personal selling or mass advertising?

BudgetBudget

• Will a push or pull strategy be most effective?

• Trade allowances and personal selling versus advertising and sales promotion

• Combination of push and pull technique

Push vs. PullPush vs. Pull

Push Strategy

Pull StrategyVSVSVSVS

Push vs. Pull Strategy

• Utilizes aggressive trade allowances and personal selling to obtain wholesaler and retailer distribution

• The product is pushed through the channel

Push Strategy

• Encourages consumer demand for the product to obtain distribution

• Use of heavy advertising and high value coupons

Pull Strategy

Evaluating Program EffectivenessEvaluating Program Effectiveness

Formulating and ImplementingMessage and Media Strategies

Setting BudgetSetting Budget

Establishing ObjectivesEstablishing Objectives

Selecting Target MarketSelecting Target Market

Formulating a Positioning StrategyFormulating a Positioning Strategy

MANAGING THE MARCOM PROCESS

• Allows marketing communicators to more precisely deliver messages to the target group

• Attempts to avoid wasting money outside the target market

• Identify potential target markets in terms of a combination of characteristics that will cause these consumers to act in a similar fashion (demographics, lifestyles and so on)

Selecting Target MarketSelecting Target Market

• Objectives must fit within the company’s overall corporate and marketing objectives

• Must also be realistic and stated in quantitative terms with the amount of projected change and the time duration specified

Establishing ObjectivesEstablishing Objectives

• Essential activity in developing successful MarCom programs

• Clear statement defining to whom a brand should be targeted, what should be said about the brand, and what media and message vehicles should be used

Formulating a Positioning StrategyFormulating a Positioning Strategy

• Top-down budgeting (TD): senior management decides how much each subunits receives

• Bottom-up budgeting (BU): managers of subunits determine how much is needed and the amounts are then combined to establish the total budget

• Bottom-up/top-down (BUTD)• Top-down/bottom-up (TDBU)• BUTD process is the most frequently

Setting BudgetSetting Budget

• Make a decision regarding the message to be communicated and the media within which the message will be sent

• Many different alternatives of media are available and each has a unique rate of effectiveness as well as cost

Formulating and ImplementingMessage and Media Strategies

• Evaluation information will be critical in creating future programs and taking corrective action when necessary

• Advertising is more difficult to measure

• Communication outcomes: changes in consumers’ awareness of the advertised brand, knowledge of copy points, or attitudes toward the brand (assess advertising effectiveness)

Evaluating Program EffectivenessEvaluating Program Effectiveness

ADVERTISING

• Advertising adds value to brand by influencing consumers’ perception

• Effective advertising can lead to increased market share and greater profitability

• U.S., the biggest advertising spender in the world

Assessing Assessing Advertising Advertising

EffectivenessEffectiveness

Objective Objective SettingSetting

BudgetingBudgeting

Selecting Selecting Advertising Advertising

MediaMedia

Creating Creating Advertising Advertising MessagesMessages

Establishing Establishing the Brand the Brand

PositioningPositioning

ADVERTISING STRATEGY

• Reasons for setting advertising objectives Make top management to agree upon the course

of advertising Guide the budgeting, message creating, and

media selection Provide standards against which results can be

measured

Objective Objective SettingSetting

• The most difficult advertising decision because it is hard to determine precisely how effective advertising has been or might be in the future

• The sales-response to advertising is influenced by a multitude of factors

BudgetingBudgeting

• Promotional budget set as a percentage of past or anticipated sales

Percent of SalesPercent of SalesPercent of SalesPercent of Sales

Objective &TaskObjective &TaskObjective &TaskObjective &Task

Budgeting for Advertising

• Objectives specified• Promotional

elements identified• Budget is

determined by accumulating anticipated costs among the various promotional elements

Percent of SalesPercent of SalesPercent of SalesPercent of Sales

Objectives &TaskObjectives &TaskObjectives &TaskObjectives &Task

Budgeting for Advertising

• Establishing how the brand is to be thought of by members of the target market and how the brand is to be perceived relative to competitive brands in the product category

Establishing Establishing the Brand the Brand

PositioningPositioning

• Advertisers use a vast array of techniques to present their brands in the most favorable light and persuade customers to contemplate purchasing these brands

Creating Creating Advertising Advertising MessagesMessages

• Informational ads

Creating Advertising Messages

• Humorous executions

• Sex appeals

• Celebrity endorsements

• Emotional appeals

• Using animation

• Extends from sound marketing strategy

• Takes the consumer’s view• Persuasive• Finds a unique way to break through

competitive clutter• Never promises more than it can

deliver• Prevents the creative idea from

overwhelming the strategy

Creating Effective Messages

• Absolut

Creative Campaigns

• Absolut

Creative Campaigns

• Absolut

Creative Campaigns

• Absolut

Creative Campaigns

• Milk

Creative Campaigns

• Milk

Creative Campaigns

• Milk

Creative Campaigns

• Milk

Creative Campaigns

• Outstanding message execution is to no avail unless the message is delivered to the right customers at the right time, and with sufficient frequency

Selecting Selecting Advertising Advertising

MediaMedia

Selecting Advertising MediaSelecting Advertising Media

Selection of Target Selection of Target AudienceAudience

Specification of Media Specification of Media ObjectivesObjectives

Selection of MediaSelection of MediaSelection of MediaSelection of Media

Purchase of MediaPurchase of MediaPurchase of MediaPurchase of Media

• Must be clearly pinpointed• Based on geographic factors,

demographics, product-usage concerns, psychographics

Selection of Target AudienceSelection of Target Audience

Specification of Media Objectives

• Reach• Frequency• Continuity• Cost

Selection of MediaSelection of Media

• Television• Radio• Magazines• Newspapers• Internet

Selecting Advertising Media

• Cost per thousand (CPM)• Gross rating points (GRP)

Purchase of MediaPurchase of Media

CPM Match Target Image ... OverallMagazine1Magazine2Magazine3......Magazine N

CPM=CPM=

GRP=Reach*FrequencyGRP=Reach*Frequency

CostCostAudience SizeAudience Size

______________________

• Measure magazine readership Simmons Market Research Bureau(SMRB) and

MediaMark Research, Inc. (MRI)

• Measure television audience size Nielsen, and Arbitron

• Others Starch Readership Service, Burke Day-After Recall

Assessing Assessing Advertising Advertising EffectivenesEffectivenes

Direct Advertising

• Database Marketing OffersAddressabilityMeasurabilityFlexibilityAccountability

• The use of any incentive The use of any incentive by a manufacturer to by a manufacturer to induce the trade induce the trade (wholesalers and retailers) (wholesalers and retailers) or consumers to buy a or consumers to buy a brand and to encourage brand and to encourage the sales force to the sales force to aggressively sell itaggressively sell it

SALES PROMOTION

Factors Giving Rise to the Growth of Sales Promotion

• Balance of power transfer• Increased brand parity and price

sensitivity• Reduced brand loyalty • Splintering of the mass market & reduced

media effectiveness• Short-term orientation & corporate

reward structure• Trade & consumer responsiveness

Sales Promotion’s Capabilities

• Facilitate the introduction of new products

• Obtain trial purchases• Stimulate sales force enthusiasm• Invigorate sales of a mature brand• Increase on- and off-shelf merchandising

Sales Promotion’s Capabilities

• Neutralizing competitive advertising• Encouraging repeat purchases• Increase brand usage by loading

consumers• Preempting competition by leading

consumers• Reinforcing advertising

Sales Promotion: Roles and Objectives

• Introduce new or revised products• Increase distribution• Build retail inventories• Maintain shelf space• Obtain display space• Reduce excess inventory• Induce cooperative advertising• Counter competition• Sell more to final consumers

Proactive MPRProactive MPRProactive MPRProactive MPR

PUBLIC RELATIONS

• Dictated by a company’s marketing objectives

• Offensively oriented • Opportunity-seeking rather than

problem-solving• Another tool for promotion of

company’s products and services

Reactive MPRReactive MPRReactive MPRReactive MPR

PUBLIC RELATIONS

• Undertaken as a result of external pressures

• Deals with changes that have negative consequences

• Attempts to repair a company’s reputation, prevent market erosion, and regain lost sales

SPONSORSHIP MARKETING

• Avoid the clutter• Help companies respond to

consumers’ changing media habits• Help companies gain the approval of

various constituencies• Enable marketers to target their

communication and promotional efforts to specific geographic regions and/or to specific lifestyle groups

Event MarketingEvent MarketingEvent MarketingEvent Marketing

• Form of a brand promotion that ties a brand to a meaningful cultural, social, athletic, or other type of high-interest public activity

• Separate from advertising, sales promotion, point-of-purchase merchandising, or public relations

Cause-Related MarketingCause-Related MarketingCause-Related MarketingCause-Related Marketing

• Narrow aspect of overall sponsorship

• Combination of PR, sales promotion and corporate philanthropy

• Linked to consumers’ engaging in revenue-producing exchanges with the firm

Cause-Related MarketingCause-Related MarketingCause-Related MarketingCause-Related Marketing

• Stride Rite

ConsumersConsumersConsumersConsumers

• P-O-P delivers useful information and simplifies the shopping process by setting products apart from similar items

RetailersRetailers ManufacturersManufacturers

POINT-OF-PURCHASE COMMUNICATIONS

RetailersRetailersRetailersRetailers

• Increased sales• Enables retailers to better organize shelf

space and improve inventory control, volume, and profitability

ConsumersConsumers ManufacturersManufacturers

ManufacturersManufacturersManufacturersManufacturers

• Calls attention to special offers and helps stimulate impulse purchasing

• Serves to complement the job already performed by advertising before the consumer enters a store

ConsumersConsumers RetailersRetailers

Supplemental Material

Communication Process

FeedbackFeedbackSourceSource

EncodingEncoding

MessageMessage ChannelChannel ReceiverReceiver

DecodingDecodingNoiseNoise

FeedbackFeedback

EncodingEncoding

DecodingDecoding

NoiseNoise

• The marketer• The sender of the message

SourceSource

FeedbackFeedback

DecodingDecoding

NoiseNoise

• Designing of advertisements, sales presentations, P-O-P displays, etc.

• Translation of the message into symbolic form

• Designing of advertisements, sales presentations, P-O-P displays, etc.

• Translation of the message into symbolic form

SourceSource

EncodingEncoding

FeedbackFeedback

ChannelChannel ReceiverReceiver

DecodingDecoding

NoiseNoise

• Actual advertisement that contains the intended message• Symbolic expression of the sender’s thoughts

MessageMessage

SourceSource

EncodingEncoding

FeedbackFeedback

ReceiverReceiver

DecodingDecoding

NoiseNoise

• Television, radio, print media, telephone, direct mail, etc.• Path through which the message moves to get to the receiver

MessageMessage ChannelChannel

SourceSource

EncodingEncoding

FeedbackFeedback

DecodingDecoding

NoiseNoise

• Person or groups of persons for whom the message is intended

SourceSource

EncodingEncoding

FeedbackFeedback

NoiseNoise

• Process receiver uses to interpret the meaning of the message• Process receiver uses to interpret the meaning of the message

ReceiverReceiver

DecodingDecoding

MessageMessage ChannelChannel

SourceSource

EncodingEncoding

NoiseNoise

• Marketing research, market share changes, sales reports• Attitude changes, purchase or non-purchase• Gauge of effectiveness of communication techniques

DecodingDecoding

EncodingEncoding

ChannelChannel ReceiverReceiverMessageMessage

• Interference at some stage in communications process• Competitive promotional messages• Misinterpretation of message or wrong receiver

EncodingEncoding

DecodingDecoding

NoiseNoise

Functions Of Advertising

InformInformInformInform

PersuadePersuade

RemindRemind

Add ValueAdd Value

Assist Other EffortsAssist Other Efforts

• Makes consumers aware of new products

• Informs them about specific brands

• Educates them about particular product features & benefits

InformInform

PersuadePersuadePersuadePersuade

RemindRemind

Add ValueAdd Value

• Persuade customers to try new products, brands & services

• Create demand for entire product category

• Build secondary demand

InformInform

PersuadePersuade

RemindRemindRemindRemind

Add ValueAdd Value

• Keeps company’s brand fresh in consumer’s memory

• Create top-of-mind awareness

InformInform

PersuadePersuade

RemindRemind

Add ValueAdd ValueAdd ValueAdd Value

• Innovation• Improving quality• Altering consumer

perceptions

InformInform

PersuadePersuade

RemindRemind

Add ValueAdd Value

Assist Other EffortsAssist Other EffortsAssist Other EffortsAssist Other Efforts

• Delivering sales promotions

• Assist sales representatives

• Pre-sell products• Provide salespeople

with valuable introduction

Create Create Brand Brand

Awareness Awareness

Create Create Brand Brand

Awareness Awareness

Enhance Enhance AttributesAttributesIntentionsIntentions

Facilitate Facilitate Purchase Purchase

Communication Objectives

Build Build Products Products Wants Wants

Build Products WantsBuild Products WantsBuild Products WantsBuild Products Wants

Create Brand Awareness Create Brand Awareness Create Brand Awareness Create Brand Awareness

Enhance Attributes/IntentionsEnhance Attributes/IntentionsEnhance Attributes/IntentionsEnhance Attributes/Intentions

• Marketers must first build product category wants or primary demand

Facilitate Purchase Facilitate Purchase Facilitate Purchase Facilitate Purchase

• After a product category is established, marketers attempt to create secondary demand for their specific brand

• After creating secondary demand, marketers want to influence attitudes and intentions

• Marketing communication variables can facilitate purchase and overcome other marketing mix variables

Hierarchy-of-Effects Models

PurchasePurchase

Purchase IntentionPurchase Intention

AttitudeAttitude

Beliefs/KnowledgeBeliefs/Knowledge

AwarenessAwareness

UnawarenessUnawareness

ConnotationConnotation

AffectAffect

CognitionCognition

PrecognitionPrecognition

Specific StageSpecific Stage Summary TermSummary Term

Methods Of Setting Promotions Budgets

• Match competitors’ actions

• Meeting competitor’s budget doesn’t allow firm to meet its own objectives

Meeting CompetitionMeeting CompetitionMeeting CompetitionMeeting Competition

Past SalesPast SalesPast SalesPast Sales

Task/ObjectiveTask/ObjectiveTask/ObjectiveTask/Objective

• Sets promotional budget based on past or anticipated sales

• Limited by forecast reliability

• Objectives specified

• Promotional elements identified

• Budget determined by costs needed to reach objectives

Integrated Marketing Communications: Advertising, Promotions. And Other MarCom Tools

Documents

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