1-1 1 Chapter One Integrated Marketing Communications.

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1 Chapter One

Integrated Marketing Communications

Ron Jon Surf Shop 1-In the 1960s, surfboard technology was changing. Homemade wooden boards were being replaced with mass-produced fiberglass models.

-A surfer name Ron Dimenna was frustrated that he could not buy one of these new and improved rides. as a result he founded the first Ron Jon Surf Shop In New Jersey.

- as time passed, the company grew, and additional locations were opened.

- store were filled with amazing variety of items, from swimsuits and surfboards to beach-themed home decorations.

Ron Jon Surf Shop 1-A refreshments stand with picnic tables is located outside the store for patrons to enjoy. The shop open 24 hours per day, 365 days a year Just like the beach.

-Chrysler Corporation Joined in 40TH anniversary of the first shop by creating a limited edition Ron Jon PT Cruiser. The car was customized for surfers needs. Only 1000 Ron Jon Cars were made.

-The 40th anniversary celebration also featured a contest in which Ron Jon memorabilia were solicited. -Awarness of Ron Jon’s Presence has growth through innovative marketing programs. Ron Jon surf shop was featured in a MasterCard Commercials.

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1-Ron Jon expanded into Land-based sports. The company sponsored an “end of summer” skateboard contest. These event were aimed at new, young customers who enjoy skateboarding as much as they do surfing. -Moreover, the company lunched several public relations campaigns focused on community involvement. Example:-1- a drive for patrons to donate blood.-2- a beach cleanup drive.-3- major donations. - the company made its products available at airports.-Finally, the company applied made some brand extension:-1- surf-themed Ron Jon Cape Resort in Cape Canaveral.-2- Ron Jon Bottled water.-3- Ron Jon Surf School.

Integrated Marketing Communications

Chapter 1 provides an overview of integrated marketing communications, the basic communications model, and the organization of the textbook. The chapter also provides information on current trends in marketing communications.

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-The global marketplace consists of a complex set of competitors battling for customers in a rapidly changing environment.

- A wide Varity of media are available to companies, ranging form simple stand alone billboard to multilingual websites.

-Ways of reaching customers are increasing as more and more nontraditional ways become popular.

-In the face of these sophisticated and cluttered market conditions. Firms try to be heard. Marketing experts know that that a company’s communications must speak with a clear voice.

-For a business to success, customers must understand the essence of the business and the benefits of that business’s goods and services.

Integrated Marketing Communications

According to the author, there are three trends that have emerged in our turbulent new marketing communications context :1- Accountability: advertising agencies are expected to produce tangible results. 2- Task performed: Account Executive, Brand or Product Manager, and creatives.

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Account Executive 1-Account Executive: is a person in an advertising agency who directs and oversees advertising and promotional; programs for client companies.

-In the past, he worked as liaison between the people who prepared commercials and client companies.

- nowadays, he is involved in developing overall strategic communication plans while, at the same time, trying to make sure each individual promotional activity achieves tangible results.

Brand Manager 1Brand manager: is the individual who manages a specific brand or line of products for client company.

When sales of a brand slow, the brand managers looks for ways to boost them.

Creatives 1Creatives: are people who develop the actual advertisements and promotional materials.

Creatives are being asked to perform additional functions:

1- contributing ideas about strategic marketing direction of the firm, while developing individual adverts.

2- creatives are also being held accountable for the effectiveness of advertising campaigns.

http://www.mms.com/us/about/characters/red/

Most advertising and marketing agencies do more than create ads. They help the client company develop totally integrated communications program.

3- Alternative media. Nowadays, companies are cutting expenditures on traditional media commercials and moving to nontraditional media such as Facebook, MySpace, YouTube, iphones, and text messaging systems.

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1“Younger consumers with considerable amount of purchasing power are less likely to watch television. They are more likely to engage in technological based interactions with friends around the world.”

Instead of trying to capture consumers attention, we should find ways to engage with and interact with consumers.

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F I G U R E 1 .1

Communication Process

=Noise

Transmission DeviceEncoding ReceiverDecodingSender

Feedback

Encoding: a creative takes the idea and transforms it into attention getting advertisement designed for various media.

Integrated Marketing Communications 1-Quality marketing communication occurs when customers ( the receivers) decode or understand the message as it was intended by the sender. -The most common form of noise affecting marketing communications is clutter.

-Current customers are exposed to hundreds of marketing messages each day.

-Look at page 8 for examples of clutter.

-Feedback takes the form of purchases, inquires, complaints, questions, visits to the store, blogs, and websites hits.

Integrated Marketing Communications 1Integrated marketing communications : is the coordination and integration of all marketing communication tools, avenues, and sources within a company into a seamless program that maximize the impact on customers and stakeholders at a minimal cost.

For years, the traditional view was that promotion activities included advertising, sales promotion , and personal selling activities. This traditional view was changed somewhat due to the accountability issue .

Now, it also includes activities such as database marketing, direct marketing, sponsorship marketing, e-active marketing , alternative marketing , and public relations.

A complete IMC plan incorporate every element of the marketing mix: products, price, distribution methods, and promotions.

Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall 1-20

F I G U R E 1 . 3The Components of Promotion

Product Price Promotion Distribution

Advertising Sales Promotions Personal Selling

DatabaseMarketing

DirectResponseMarketing

SponsorshipMarketing

E-ActiveMarketing

PublicRelations

AlternativeMarketing

SocialMedia

An Integrated Marketing Communications 1Integrated marketing is based on the strategic marketing plan. This plan coordinates efforts in all components of the marketing mix.

The purpose is to achieve harmony in the message sent to customers and others.

The same plan integrate all promotional efforts to keep the company’s total communications program in synchronization.

Figure 1.5 lists the steps required to complete a marketing plan.Step one is Situational Analysis : which is the process of examining factors from the organization’s internal and external environment.This analysis aims to identifies marketing problems and opportunities present in the external environment as well as internal company strengths and weaknesses.

1Step two is Marketing objectives.

These objectives include targets such as higher sales , an increase in market share, a new competitive position, or desired customer actions, such as visiting the store and making purchases.

Step three is Marketing budget.

Based on the marketing objectives, a marketing budget is prepared and marketing strategies are finalized.

Step four is Marketing strategies. they apply to all ingredients of the marketing mix, plus any positioning, differentiation, or branding strategies.

Integrated Marketing Communications 1

Step five is Marketing tactics.

Marketing tactics guide the day by day activities necessary to support marketing strategies.

The final step is stating how to evaluate performance.

Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

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F I G U R E 1 . 10

Overview of IMC Text

Corporate ImageBrand Management

BuyerBehaviors IMC Planning Process

AdvertisingManagement

Advertising DesignTheory & Appeals

Advertising DesignMessages & Frameworks

TraditionalMedia

E-ActiveMarketing

AlternativeChannels

Regulation& Ethics

Evaluation

Database, Direct Response, & Personal Selling

PublicRelations &

Sponsorships

SalesPromotions

our textbook design.• The first section of our textbook builds foundations for IMC program.• Chapter two describes the corporate image and brand management

elements by answering the following question: who are we, and what message are we trying to send? chapter four describes the promotion opportunity analysis element of a IMC

program. It includes identifying all target markets. -The second section of this book is devoted to advertizing issues. It includes

the following: chapter five- advertising management, chapter six advertising theories, chapter seven- advertising design.

- The third section contains information regarding both traditional and new cutting ideas about how to reach potential customers. the discussion encompasses traditional media channels ( TV, Radio, Magazines, newspapers, outdoors signs, and direct mail)- chapter eight, chapter nine-E- active marketing, and chapter ten- Alternative Marketing( buzz marketing, Guerilla marketing).

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• Database and direct response marketing programs are outlined in chapter eleven. This chapter discuss issues such as: data collection and analysis, permission marketing, CRM systems .

• in chapter twelve the textbooks authors discuss sales promotion which are divided into two different types: trade promotion, and consumer promotion.

• Public Relations programs will be discussed in chapter thirteen. The discussion will cover topics such as, dealing with negative publicity, and cause related marketing.

• finally, integration tools which are the top level of the IMC program. the integration tools needed to make sure that all customers are

effectively served.

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Refining the IMC program.

• IMC involves much more than writing a plan. It is also not limited to the company’s marketing department. IMC is a company-wide activity. To be successful every part of the organization’s operation must be included.

• Four stages are involved in designing an IMC system:• Firstly, identifying, coordinating, and managing all forms of marketing

communication.• The objective of this stage is to bring all the of a company’s

communication elements together under one umbrella, including advertising, promotion, direct marketing, internet and e-commerce programs, public relations, sponsorship, and other marketing activities.

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Refining the IMC program.

• secondly, communication are examined form the perspective of the customer. The marketing team analyze every contact that might influence customers.

• It means studying every internal and external groups that might affect perception of the company and its products. Such as, employees, distributors, retailers, dealers, product package designers, and others .

• Thirdly, the use of Information technology. A company should find ways to use information technology in enhancing its IMC programs.

• With Computer technology and the abundance of information, marketing teams now has the capacity to develop data-driven programs to meet the needs of individual customers and allow for the customization of marketing messages.

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Refining the IMC program.• Fourthly, the use of customer data information and insights to assist

corporate strategic planning. • The information guides marketing decisions and the communication

approaches aimed at individual customer segments. • Look at Dow Chemical, FedEx example on page 13.

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the value of IMC plans

• Advances in technology and communications are major new forces in integrated marketing communications, consumers must be reached in a holistic fashion.

• There are several trends linked to the increasing importance of integrated advertising and marketing communication programs :

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- 1- information technology. technology enables instant communications among business executives,

employees , channel members, and others around the world. - It also create opportunities for marketing communications. Consider the

effect of UPS ( universal product code) bar code system !!!!. Previously, companies were using test market, attitudinal research, and intention to buy surveys to predict consumer purchasing behavior.

- Consider the effect of advanced statistical software which helps in analyzing the data !!!!. By these software we can analyze data more efficiently.

- Information about consumers can be correlated with items they buy, when they buy, and where they buy.

- Companies now can determine who is buying and the best communication channel to reach them.

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the value of IMC plans2- change in channel power:- Numerous technological developments have changed the levels of

power held by members of the channel. - Oftentimes retailers hold the most power, because they control shelf

space and purchase data. - The size and power of mega-retailers means manufacturers and

suppliers have no choice but to follow the dictates of these “big box” stores.

- However, the advancement of the world wide web and information technology has caused some channel power to shift to consumers.

- Although many individual still purchase the majority of products and services offline, individuals are shifting to more integrated approaches to learning about products and making purchases.

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the value of IMC plans

• 3- increases in competition:• Information technology and communication advances have dramatically

changed the marketplace.• The company that delivers on both quality and price get the business,

regardless of its location. • In this competitive environment , the only way one firm can gain sales is

to take customers away from another.• Integrating advertising and other marketing communications became

extremely important. • Companies should create quality IMC program that reaches customers

and others in the distribution chain. • The goals of manufacturers is to maximize its exposure to consumers

and retailers. • retailers focuses their IMC efforts on maintaining customers loyalty.

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the value of IMC plans• 4-Brand Parity:• Many of the available brands in many product categories offer nearly

identical benefits. • consumers view quality levels of these brands as being nearly equal. • From the consumer perspective, this means that shoppers will

purchase from group of accepted brands rather than one specific brand.

• Other criteria, such as price, availability, and promotional deals have a higher importance.

• In response, marketing teams tries to create messages that express how the company’s products are clearly different.

• IMC programs are designed to gain the benefits associated with a strong brand name.

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the value of IMC plans• 5- integration of information:• Consumers have a variety of choices regarding where they obtain

information. • If they are dissatisfied with the quantity and quality of information they

have, they can easily obtain additional information.• So, company leaders should make sure that every contact point project

the same message. • 6- Decline in the Effectiveness of Television Advertising:• VCRS and DVR systems allow consumers to watch programs without

commercials.• The use of remote controls; consumers can switch easily to another

channel during the commercials break. • The rise in the popularity of cable TV, and satellite dishes; means

consumers have wide variety of viewing choices.

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the value of IMC plans- Many television advertisement are not seen.- Look at figure 1.11- To overcome problems shown in the figure, it is vital to create new

and innovative communication programs that hold the viewers attention.

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International implications• When a company tries to integrate its marketing communication on

the global level, the mission becomes more difficult. Why?• In the past marketers could employ two different strategies globally:• 1- standardization.• 2- adaptation. • The GIMC approach (global integrated marketing communications

program) is easier to apply when a company relies on the standardization method.

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Market globally act locally

• McDonald’s example:• In the UK, McDonald’s strategy is to listen more to local consumers

and then act on it. The company strives to do this around the world. Some if its local favorites around the world include the McItaly burger in Italy, Maharaja Mac in India, the McLobster in Canada, the Ebi Filit-O in Japan. McDonald’s has novelty items on its menu in Japan like the Teriyaki

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