Chap001 Integrated Marketing Communications

7/31/2019 Chap001 Integrated Marketing Communications

1/52

An Introduction to IntegratedMarketing Communications

McGraw-Hill/Irwin 2004 The McGraw-Hill Companies, Inc., All Rights Reserved.


2/52


3/52

Integrated Marketing Communications

A marketing communications planningconcept that recognizes the value of acomprehensive plan.

A plan that evaluates the strategic roles ofseveral communications disciplines:

Media advertising Direct marketing

Interactive/internet marketing

Sales promotion

Publicity/Public relations

Combines the disciplines to provide: Clarity

Consistency

Maximum communications impact


4/52

The Marketing &Promotional Mixes

Marketing Mix: Product or Service

Pricing

Channels of Distribution

Promotion

Promotional Mix: Advertising

Direct Marketing

Interactive/internet marketing Sales Promotion

Publicity/Public Relations

Personal Selling


5/52

Promotional Program Situation Analysis

Analysis of the Communications Process

Budget Determination

Develop Integrated Marketing Communications Programs

Review of Marketing Plan

AdvertisingSales

Promotion

PR/

Publicity

Personal

Selling

Direct

Marketing

Advertising

Objectives

SalesPromotionObjectives

PR/Publicity

Objectives

PersonalSelling

Objectives

DirectMarketingObjectives

Message

Strategy

SalesPromotionStrategy

PR/PublicityStrategy

PersonalSelling

Strategy

DirectMarketingStrategy

Integration & Implementation of Marketing Communications Strategies

Monitor, Evaluate & Control Promotional Pro ram

Internet/

Interactive

Internet/InteractiveObjectives

Internet/InteractiveStrategy

Integrated Marketing Communications Planning Model


6/52

REVIEW OF MARKETING PLAN

1. To examine overall marketing plan- What do you want toachieve or what is the objective?

2. Role of advertising in promotion- is it awareness orbuying behaviour

3. To do competitive analysis- analyse what you

competitor is doing4. Asses the environmental influence- such as value,

life style changes etc :Specifies the objectives to beachieved-

Market share Market leadership

Use of the 4 elements of marketing mix

Fix time frame for implementing various activities

Monitor and evaluate the success of marketing activities


7/52

Coca-Cola is the worlds most valuable brand


8/52

Analysis of Promotional Programme

1. Internal Analysis:

Product & service offered by the company The capability of the co. to implement the promotional

programme

Review of success and failures of the past programme

Decide promotional should be done either in-house orthrough external agency ( decide who )

Strength and weakness of the org by doing promotion &the image of product/service

External Analysis Consumer behaviour analysis

Market segmentation & Target Marketing

Market positioning

Competitor and environmental analysis


9/52

IMC Program Situation AnalysisExternal Factors

Environmental analysis Technological Political/Legal

Demographic Socio/Cultural

Economic

Competitive Analysis Direct and indirect competitors

Position relative to competitors

Size of competitors advertising/

promotional budgets

IMC strategies being used by competitors


10/52

IMC Program Situation AnalysisExternal Factors

Customer AnalysisWho buys our product or service?

Who initiates and makes the decision

to purchase and who influences the process?

How is the purchase decision made?What attributes or criteria are important to

customers?

What are customers perceptions of and attitudes

toward our company, product/service or brands?What factors influence the decision making process?

Contact points where customers can be reached?

De e op Integ ate Ma eting Comm nications P og am


11/52

Any paid form of nonpersonal communication

about an organization, product, service, ideaor cause by an identified sponsor.

Deve op Integrate Mar eting Communications Program

Advertising

Disadvantages of advertising

High costs of producing

and running adsCredibility problems and

consumer skepticism

Clutter

Difficulty in determiningeffectiveness

Advantages of advertisingAdvertiser controls the

messageCost effective way tocommunicate with largeaudiences

Effective way to create

brand images andsymbolic appealsOften can be effective

way to strike responsivechord with consumers

l d k
http://66.28.32.123/netfu/tmp10023/coollogo_com_261291919.gifhttp://66.28.32.123/netfu/tmp10023/coollogo_com_261291919.gif


12/52

Develop Integrated MarketingCommunications Program

AdvertisingDetermine objectives and budgetMessage development

Called Creative Strategy Determine basic appeal

Determine main messageMedia strategy

Communication channels Type of media . . .

Newspapers/Magazines

Radio/Television Outdoor/Specialty

Select specific media Specific papers, magazines, TV

programs, radio stations, billboards, or

other media


13/52

An example of a business-to-business ad

Source: Courtesy Honeywell.


14/52

Marketing activities that provide extra

value or incentives to the sales force,distributors, or ultimate consumers andcan stimulate immediate sales.

Sales Promotion

Trade-oriented

Targeted toward marketingintermediaries such asretailers, wholesalers, ordistributors

Promotion allowances

Merchandise allowances

Price deals

Sales contests

Trade shows

Consumer-oriented

Targeted to the ultimateusers of a product orservice Coupons

Sampling Premiums Rebates

Contests

Sweepstakes

POP materials


15/52

Sales Promotion Uses

Introduce new productsGet existing customers to buy more

Attract new customers

Combat competitionMaintain sales in off season

Increase retail inventories

Tie in advertising & personal sellingEnhance personal selling efforts


16/52

Coordinating the promotional mix

elements to develop a controlled,integrated program of effectivemarketing communications.

Promotional Management

Considerations for developing thepromotional program include:

Type of product

Buyers decision process Stage of product life cycle

Channels of distribution


17/52

A system of marketing by which

organizations communicate directlywith target customers to generate aresponse and/or a transaction.

Direct Marketing

Disadvantages of direct marketing

Lack of customer receptivity andvery low response rates

Clutter (too many messages)

Image problems particularly with

telemarketing

Advantages of direct marketingChanges in society have madeconsumers more receptive todirect-marketing

Allows marketers to be veryselective and target specific

segments of customersMessages can be customized forspecific customers.

Effectiveness easier to measure


18/52

Direct Marketing

Direct marketing methods

Direct mail

Catalogs

Telemarketing

Direct response ads

Direct selling

Internet


19/52

Publicity

Advantages of publicityCredibility

Low cost (although not totally free)

Often results in word-of-mouth

Disadvantages of publicityNot always under control of

organization

Can be negative

Nonpersonal communication regarding an

organization, product, service, or idea notdirectly paid for or run under identified

sponsorship.


20/52

Publicity Vehicles

News Releases: Single-page news stories sent to media who

might print or broadcast the content.

Feature Articles: Larger manuscripts composed and edited for

a particular medium.

Captioned Photos: Photographs with content identified and

explained below the picture.

Press Conferences:

Meetings and presentations to invitedreporters and editors.

Special Events: Sponsorship of events, teams, or programs

of public value.


21/52

Advertising Versus Publicity

FACTOR ADVERTISING PUBLICITY

Control Great Little

Credibility Lower HigherReach Achievable Undetermined

Frequency Schedulable Undetermined

Cost Specific Unspecified/low

Flexibility High Low

Timing Specifiable Tentative


22/52

Public Relations

Tools used by PublicRelations Publicity

Special publications Community activity

participation

Fund-raising

Special event sponsorship

Public affairs activities

The management function which evaluates public

attitudes, identifies the policies and procedures ofan individual or organization with the public interest,and executes a program of action to earn publicunderstanding and acceptance.


23/52

Direct person-to-person communication

whereby a seller attempts to assistand/or persuade perspective buyers toto purchase a product or service.

Personal Selling

Disadvantages of personal selling

High costs per contact Expensive way to reach large

audiences

Difficult to have consistent anduniform message delivered to

all customers

Advantages of personal selling

Direct contact between buyerand seller allows for moreflexibility

Can tailor sales message tospecific needs of customers

Allows for more direct andimmediate feedback

Sales efforts can be targetedto specific markets andcustomers who are bestprospects.


24/52

A form of marketing communication through interactive mediawhich allow for a two-way flow of information whereby users can

participate in and modify the content of the information theyreceive in real time.

Interactive/Internet Marketing

Disadvantages of interactive/

internet marketing Internet is not yet a mass

medium as many consumerslack access

Attention to Internet ads is

very low Great deal of clutter on the

Internet

Audience measurement is aproblem on the Internet

Advantages of interactive/

internet marketingCan be used for a variety of IMC

functions

Messages can be tailored to

specific interests and needs ofcustomers

Interactive nature of the Internetleads to higher level ofinvolvement

Can provide large amounts ofinformation to customers.


25/52

Interactive/Internet Marketing

Use of the Internet as an IMC ToolAs an advertising medium to inform, educate

and persuade customers

As a direct sales tool

To obtain customer database information

To communicate and interact with buyers

To provide customer service and support

To build and maintain customer relationships

As a tool for implementing sales promotion

As a tool for implementing publicity/public

relations programs


26/52

Marketing and promotions process model

Opportunity Identifying Product Promotional Target Market

analysis Markets Decisions Decisions Promotion to

1 Advertising final buyer

2 Direct

Marketing

Competitive Market Pricing 3 Interactive Ultimate Consumer

analysis Segmentation Decisions Marketing Consumers

4 Sales Businesses

Promotion5 Publicity

Target Selecting a Channels of & Public

Marketing Target Market Distribution relations Promotion to trade

Decisions 6 PersonalSelling Resellers

Positioning

through

Marketing Purchase

strategies


27/52

The Communication Process

Sender Encoding Channel

Receiver

DecodingResponseFeedback

Noise


28/52

Analysis of Communication

There are 3 aspects in analyzing the communication

process

How does the consumer respond to marketing

communication

What stories, message and channel factor should beused to communicate with the consumer

Establish communication objectives: such as should

promotion create awareness or knowledge about the

product or should it create an image or favorableattitude


29/52

IMC Communication Tools

IMC Communication Tools

AdvertisingDirect

Marketing

Interactive/

Internet Marketing

Sales

PromotionPublicity/Public

Relations

Personal

Selling

l C Ob


30/52

Potential Communications Objectives

Individual salesCustomer loyalty

Company image

Brand image

Store patronage

Service contract

An inquiry

A visit by the prospect

Product trial

Prescription for use

Recommendation

Adoption of the product


31/52

Communications Objectives

Informing Awareness

Interest

Benefits

Other information

Persuading Preference based on

competitive

advantages

Brand switching orprevention of brand

switching

Reminding

Trigger memories

Maintain preference

and buying habits

B d t D t i ti


32/52

Budget Determination

It involves:

Setting a tentative objective for marketing Communication Allocating tentative budget after the communication objective

Promotional budget as to be decided.( 2 questions need to be

answered)

a) How much promotional programme will cost?

b) What percentage of sales revenue should be allocated towardsthe promotional programme?

This is known as Tentative budget.

S i l d i D l i IMC P


33/52

Steps involved in Developing IMC Program

1. Creation of central theme for IMC campaign

2. Creative strategic planning development3. Creative strategic implementation and evaluation

4. Media planning and strategy

5. Selection of optimal media

6. Proposition of various mediums7. Evaluation of different media effectiveness- Broadcast, print,

outdoor, others

8. Deployment of direct marketing in IMC program

9. Deployment of internet as a promotional tool10. Deployment of sales promotion techniques

11. Developing public relations/publicity and corporate advertisingpromotional tool

12. Deploying personal selling as a promotional tool

The objectives of this ad include image


34/52

The objectives of this ad include imagebuilding and encouraging inquiries

Contact Points Where Customers Can Be


35/52

Contact Points Where Customers Can BeEffectively Reached

Mass media Broadcast - radio/TV

Newspapers

Magazines

Direct MarketingInternet/interactive

Brochures, salesliterature

Publicity/PR

Events/sponsorships Local

Regional

National/international

Sales PromotionsIn-store/POP

Product placements in moviesand television shows

Promotional products

Integrate & implement Marketing communication


36/52

Integrate & implement Marketing communicationstrategies

The following steps are involved in implementation of the IMC

Integrate the promotional mix strategies

Create the necessary advertisement- both for message &

content

Purchase media, time and space

Design and distribute sales promotion material

Design publicity programme

Design and implement direct marketing programme

Design and implement interactive/internet

marketing programs

Monitor, Evaluate and Control Integrated


37/52

Monitor, Evaluate and Control IntegratedMarketing Communications Program

Evaluate promotional programresults and determine

effectiveness

Take actions to control andadjust promotional programs

Eff ti f M k ti C i ti


38/52

Effectiveness of Marketing Communications

As for as an effectiveness of reach is concern marketing communications plays a

vital role. Basically communication makes aware about your products and services

to the target audience. This is a major task for the marketing department.

It must be attentive, catchy or drive attention

It should be result oriented

It should be focused on feedback

It should be transformed in to diff modes of communication ex; WOM

It Should be flexible in nature

It should drive experience with in yourself

Advertising


39/52

Advertising

Definition: Any paid form of nonpersonal communication about anorganization, product, service, idea or cause by an

identified sponsor.Purpose:

Generate primary demand and secondary demand

An enquiry

A visit by the prospect

Product trial

Prescription for use

Recommendation

Adoption of the product

Individual sales Customer loyalty

Company image

Brand image

Store patronage

Service contract

Roles of Advertising


40/52

Roles of Advertising

Communication with the consumers:

Advertising is a major way ofestablishing communication between the manufacturer and the

consumer. Advertising acts as reminder to the existing consumers and attracts new customers as

well. therefore., we say that advertisements act as an effective communication vehicle with the

target audience.

Persuasion:Advertisements attempts to persuade the buyer.

Catalyst for change: Creative advertisement leads to the change in perception of thecustomer. Advertisement communicates about the product or service differentiating withrespect to other competitors. It includes the customer to change the product or the brand. Eg.Weight reduction tablet induces the customer to switch over for over for looking slim and trim.

Contribution to economic growth: Advertisements helps in developing new marketsegments. The development of new market segment means mobilizing for more demand,

leading to more production, generating more income and employment opportunities.And henceadvertisement is a potential weapon to improve the economic growth of the country.

Need for Non- Commercial Advertisements (NCA)

The non-commercial advertisement is mainly done in the public interest. Indian Cancer Societycampaigns with respect to How to prevent cancer. Advertising for a social cause is a part ofnon-commercial advertisement. Ex: Pollution prevention, Oneness of the state, Antidowry Campaigns, Children Immunization against diseases etc.

Functions of Advertising


41/52

Functions of Advertising

Advertising informs the buyers about the existence of theproduct, its features, benefits & availability

It offers an incentive to buy by making several direct offerslike price-offs or exchange of an old to new one

It provokes us to try the product and once tried it remindsus

Advertising builds brands, gives an image and personality

to the brand It provides us reasons to buy particular brand.

It contributes brand preference and brand loyalty

Advertising helps us to choose out of several brandsavailable

Advertising being mass communication is the most costeffective way to reach consumers

Advertising thus reduces selling costs

Advertising persuades people to act.

ADVERTISING TYPES


42/52

ADVERTISING TYPES

Advertising can be classified into 6 categories they are as follows

Consumer Advertising: Most of the consume products company encourage

product advertising. Marketers of cosmetics, detergents, soaps are included here.

Sponsors in this area compete with one another to establish an advantage for their

particular brand

Service Advertising: Service sector encompass such services as medical services,financial services, education services etc. In service advertising, the serviceprovider to sells his expertise. Its very difficult because 1) services are tangible,there is no transfer of ownership, difficult to differentiate, production/ consumptionare inseparable.

Industrial Advertising: The number of industrial advertising as percentage ofsales is much less compared to consumer product advertising. The task ofindustrial advertiser is very complicated because of the peculiar characteristics of

buyers. The demand being derived in nature, the advertisement may loose

the intensity of the product.

ADVERTISING TYPES


43/52

ADVERTISING TYPES

Surrogate Advertising: The word surrogate means substitute. In this type

of advertisement one product is substituted for another example. Alcohol

advertisement is banned, but mineral water or apple juice or soda is being substituted

for advertisement.

Trade Advertising: It consists of two parts. They are

Retail advertising: This covers those items sold directly to the consumer by retail

shop. The retail advertising includes advertisements released by establishments that

sell services such as petrol pump, banks, apparels and house hold things etc. one

important aspect of retail advertising is known as cooperative advertising: Here the

advertising costs are shared between the retailer and manufacturer

Wholesale advertising: This advertising is unfortunately not well organized at home.

This is because, in whole sale advertising, the wholesalers are seldom keen on

advertising, either for themselves or for their dealers.

ADVERTISING TYPES


44/52

ADVERTISING TYPES

Non-profit Advertising: Here idea selling done instead of product or service. This isgenerally aimed at fund rising ( Send us a cheque for Prime Ministers Flood ReliefFund), persuasion to act( get a physical check up for malaria), anti- smoke etc

Public Service Advertising: This advertisement is directed towards the socialwelfare of the nation or the community. Ex: LICs advertisement on drugaddiction gum care etc. In this type, the objective is to put across a messageintended to change attitude or behavior of the public. Advertisement on drinkingand driving and ads of Cry Card for donations to support poor children areexamples of Public Service Advertising.

ADVERTISING V/s MARKETING MIX


45/52


The elements of marketing mix are

Product

Price

Place

Promotion

Advertising is a communication tool in marketing; advertising helps to move the product orservice to the end user. The extent to which the advertisement is used as a communication tooldepends upon the nature of business.

Take an example of a physician. He wishes to improve his business. He may put a sign on thedoor or distribute a pamphlet in the area with regard to service offered. Due to professionalethics, doctors are being barred to use promotion. Therefore in this business, a little scope foradvertisement. The most important factor which influence the patients to go to the doctor is

Skill, Experience, Location, Charges levied, His reputation.

On the other hand where as a publisher launches his new periodical, advertising will play amajor role. From the above example, it is evident that advertising plays a different roles inmarketing various products/services. The role of advertising depends on How marketing mix isused to promote the product or service.



46/52


Advertising and Product:

When a company develops a product, it s necessary to keep the bundle of benefit expected by thetarget customer segment. The classification of its product is important in defining themarketing mix. There are several ways of classifying products. Classification may be based on Who buys them or how tangible they are or the classification can be also based on therate of consumption

Offering product differentiation is the basic marketing strategy. Sometimes, the differences

between the products may be noticeable. When the difference can be noticed, they are called

perceptible differences. Ex: In cars and refrigerators, the shape, color, features are noticeable.

Advertisement and Place : The first question to be answered by the manufacturer of aproduct is Where do consumers buy? For distributing the product, two basic methods may beused 1) Direct 2) Indirect

Direct distribution is a process, wherein the company is in direct contact with the end user. Most

industrial product will follow this route.

Indirect distribution is a process, where, intermediaries like retailer, wholesaler, etc. industrial

manufacturers have their agents or distributors to supply components to OEM.



47/52

/

Advertising and Promotion:

Promotion relates to the communication between seller and buyer. Promotion mix constitutes

personal selling, advertising, sales promotion, public relations etc.

Personal Selling: The methods of personal selling are

Selling done by counter sales personnel

Selling done by company sales people, who gets in touch with the customer

Direct selling where advertising takes the entire burden of sales.

Advertising: Its paid form of nonpersonal selling, to create awareness among the customers

Public relations: Companies resort to public awareness exercise to supplement advertising. Publicrelation includes publicity such as inshore leaflets, press release, lobbying etc. it promotes the

company as dependable brand to investors. PR helps to fight negative publicity. PR influencesopinion formers such as journalists, where pre-paid mass media advertising back tracks

Sales Promotion: Includes free samples, Discounts, money off coupons exchange offers etc



48/52


Advertising and Price:

Advertising can communicate the price of the product. If there is price reduction, it shouldbe communicated to motivate the consumers to buy the product/service. Mostadvertisements do not speak of price, but define the feature of the product. Price influencesthe advertising. Therefore it is important to know how prices determine a product. Factorssuch as competition, demand, cost of promotion, distribution has its bearing on price.Sometimes companies launch products, the price is kept higher to increase the short termprofits with good development of cost. As the product reaches the maturity stage, thecompany intends to get higher share of the market, thereby reducing the price. At each ofthese phases the advertising message will be different

Influences on Pricing strategy on Advertisement

Skimming Pricing

Penetration Pricing

Comparative Pricing: By offering tow things quoting the price ex: Audio & Video equip

Competitive Pricing: Show the price in big bold format: ex: Big Bazaar, Food world,

Promotional Pricing: Promotional drive could clear the old stock. During festival season

Prestige Pricing : Here supplier wants only those clients, who could pay higher price inexchange for quality and better services.

Advertising Appeals


49/52

Advertising Appeals

The advertising appeal refers to the approach used to attract the attention of

consumers and/ or into influence their feelings toward the product, service or

cause. An advertising appeal can also be viewed as something that moves

people, speaks to their wants or needs and excites their interest.

Hundreds of different appeals can be used as the basis for advertising messages.

At the broadest level these approaches are generally broken into two categories:Informational/Rational appeals and Emotional appeals.

Informational/Rational appeal: This type of appeal focus on the consumers practical,functional, or utilitarian need for the product or service and emphasize features of aproduct or service and/or other benefits or reasons for owning or using a particular brand.

The content of these messages emphasizes facts, learning and the logicpersuasion. Rational based appeals tend to be informative, and advertisers using themgenerally attempt to convince consumers that their product or services has a particularattribute(s) or provides a specific benefit that satisfies their needs.

Ex: Digital TV ads comparison channels with prices in terms of quality,

Clinical ads, Surfexcell ads etc, Washing powder nirma,

Advertising Appeals


50/52

Advertising Appeals

Emotional appeal: Emotional appeals relates to the consumers social and/orpsychological needs for purchasing a product or service. Many consumers motives for their

purchase decisions are emotional and their feelings about a brand can be more importantthan knowledge of its features or attributes.

Personal states of feelings

Safety

Affection

Fear

Love

Happiness

Excitement

Sentiment

Ex: Johnson baby ads, Athithi Devobhava (Tourism service), Parachute, Gems ads,

Advertising Appeals


51/52

Advertising Appeals

Advertising and the Product Life Cycle


52/52

Advertising and the Product Life Cycle

Informative advertisingBuild initial demand for a product.

Persuasive advertisingImprove the competitive status of aproduct.

Reminder-oriented advertisingMaintain awareness of the

importance and usefulness of a product.

Chap001 Integrated Marketing Communications

Documents