Integrated Marketing Communication

Prof Ashok Kumar

Text books : Advertising and Promotion 7th Edn An Integrated Marketing Communication

perspective . By Blech .G and Blech M and Keyoor Purani

Strategic Communications, Planning for effective Public relation & Marketing .

5th Edn . By Dubuque, I.A Kendall / Hunt .

2.12.22.32.4

Factors contributing to importance of IMCParticipants in IMC management, IMC Planning ProcessStructure of Promotion Industry,

Unit 3 IMC – Marketing Environment & Understanding the Consumer Behavior

5

3.13.23.3

Understanding of Marketing EnvironmentSegmentation, Targeting and Positioning Understanding the consumer buying behavior

Unit 4 IMC- communication Process 4

4.14.24.3

Understanding IMC communication ProcessUnderstanding the Massage, Objective and budgeting for IMCResponse hierarchy models

Unit 5 IMC Strategies 4

5.15.2

Creative StrategyMedia Strategy

Unit 6 IMC Tool 9

6.16.26.36.46.56.66.7

Advertising Sales PromotionPublic Relations & Corporate AdvertisingInternet Advertising & E-commerceDirect Marketing Sponsorship & Point-of-purchase Personal Selling & Sales Management

Unit 7 IMC –International Perspective 2

Unit 8 Legal, Social & Ethical Aspects of IMC 2

Unit 9 Case Studies and Guest Session & Assignment

5

A management concept designed to make all aspects of marketing communications such as internal , external ( advertising, sales promotion, online media, social network , public relations, and direct marketing ) , horizontal and vertical work together as a unified force, rather than permitting each to work in isolation.

Basic premise : “The sum is always greater than their parts” – Provided they speak consistently with one voice all the time, every time .

Why integration? • Consistency, else confusion • Clarity, else confusion • Impact, since different Marcom tools have different strengths • The tools of IMC thus need to be integrated

IMC’s aim : PERSUADE WITH TARGETED AUDIENCES TO

INFLUENCE ATTITUDES AND BEHAVIOR

Remind

Persuade

Inform

Reinforce

MARKETING COMMUNICATIONS OBJECTIVES

• Increase Market Penetration• Develop Repeat Purchase Behavior• Establish Customer Relationships• Increase Rate of Consumption• Encourage Product Trial• Stimulate Impulse Buying• Stimulate Demand• Differentiate the Product• Establish a Product Image• Influence Sales Volume• Establish, Modify, or Reinforce Attitudes• Develop Sales Leads• Stimulate Interest• Establish Understanding• Build Support & Acceptance

The levels of integration such as Horizontal, Vertical, Internal, External and Data integration help to strengthen Integrated Communications.

Horizontal Integration occurs across the marketing mix and across business functions - for example, production, finance, distribution and communications should work together and be conscious that their decisions and actions send messages to customers. While different departments such as sales, direct mail and advertising can help each other through Data Integration. This requires a marketing information system which collects and shares relevant data across different departments

.

Vertical Integration means marketing and communications objectives must support the higher level corporate objectives and corporate missions.

Internal Integration requires internal marketing - keeping all staff informed and motivated about any new developments from new advertisements, to new corporate identities, new service standards, new strategic partners and so on.

External partners such as advertising and PR agencies, channel to work closely together to deliver a single seamless solution - a cohesive message - an integrated message.

Effective Marketing Communications

• Step 1: Identifying the target audience– Includes assessing the audience’s perceptions of

the company, product, and competitors’ company/product image

• Step 2: Cognitive, affective, and behavioral objectives may be set

• Step 3: AIDA model guides message design

According to Source Credibility Theory, acceptance of the message depends on: 'Expertness' and Trustworthiness' of the source.

Expertness is defined as the perceived ability of the source to make valid assertions.

Trustworthiness is defined as the perceived willingness of the source to make valid assertions.

Target Audience acceptance increases with the expertness of the source and the ability of the audience to evaluate the product.

Communication theory

Message Content

Expertness Trustworthiness

Expertness is defined as the perceived ability of the source to make valid assertions.

Trustworthiness is defined as the perceived willingness of the source to make valid assertions.

Acceptance by target audience

According to Source Attractiveness Theory, which is based on social psychological research, the acceptance of the message depends on :

1.Familiarity, Likeability & Similarity. Familiarity is the audience's knowledge of the source through exposure.

2.Likeability is the affection for the source's physical appearance and behavior .

3.Similarity is the resemblance between source and receiver.

This theory explains the message acceptance in two ways: Identification and Conditioning.

Identification is when the target audience begins to identify with the source's attractiveness, and hence tends to accept his opinions, beliefs, habits, attitudes etc.

Conditioning is when the attractiveness of the source is supposed to pass on to the brand after regular association of the source with the brand.

17

Brand communication strategy without

having Consumer insight is Like

winking at a pretty girl in dark.

“Ogilvy & Mather India” (O&M), India’s largest advertising agency

Value delivery

Consumer Decision

Persuasive communication models to shift the attitude

StagesAIDA

Model

Hierarchy-of-Effects Model

Cognitivestage

Affectivestage

Behaviorstage

Attention

Interest

Desire

Action

Awareness

Knowledge

Liking

Preference

Conviction

Purchase

AIDA and Hierarchy of Effects to persuade the target audience

Attention Interest Desire Action

Awareness

Knowledge

Liking

Preference

Conviction

Purchase

AIDA

Foote, Cone & Belding Grid for effective communication strategy

1Informative

Strategy

2AffectiveEmotional

appeal

3Habit

FormationConsumer

Conditioning

4Self- ego

Satisfaction

Thinking Feeling

Hig

hIn

volv

emen

tL

ow

Invo

lvem

ent

Best Print Ads January 2012

Media Agency’s organization structure

Agency Director

Key Account Management And services

Post production

Division

Finance and client billing

Media Planning & buying Division

Creative Planning division

Market survey and

Behavior research

KEY Account Management – Within an advertising agency the account manager or account executive is tasked with handling all major decisions related to a specific client. These responsibilities include locating and negotiating to acquire clients. Once the client has agreed to work with the agency, the account manager works closely with the client to develop an advertising strategy. For very large clients, such as large consumer products companies, an advertising agency may assign an account manager to work full-time with only one client and, possibly, with only one of the client’s product lines. For smaller accounts an account manager may simultaneously manage several different, though non-competing, accounts.

Creative Team –The principle role of account managers is to manage the overall advertising campaign for a client, which often includes delegating selective tasks to specialists. For large accounts one task account managers routinely delegate involves generating ideas, designing concepts and creating the final dvertisement, which generally becomes the responsibility of the agency’s creative team. An agency’s creative team consists of specialists in **GRAPHIC  DESIGN  SECTION**COPY   WRITING  SECTION**FILM  PRODUCTION**AUDIO  PRODUCTION**COMPUTER  PROGRAMMING

Market Researchers – Advertising agencies employ market researchers who assess a client’s market situation, including understanding customers and competitors, and also are used to test creative ideas. For instance, in the early stages of an advertising campaign researchers may run focus group sessions with selected members of the client’s target market in order to get their reaction to several advertising concepts. Researchers are also used following the completion of an advertising campaign to measure whether the campaign reached its objectives. **CONSUMER  RESEARCH**MARKET  AUDIT**MARKET  SURVEYS

Media Planners – Once an advertisement is created, it must be placed through an appropriate advertising media. Each advertising media, has its own unique methods for accepting advertisements, such as different advertising cost structures different requirements for accepting ad designs, different ways placements can be purchased (e.g., direct contact with media or through third-party seller), and different time schedules (i.e., when ad will be run). Understanding the nuances of different media is the role of a media planner, who looks for the best media match for a client and also negotiates the best deals.**MEDIA  SURVEY*TARGET  AUDIENCE  STUDY**MEDIA  PLANNING*MEDIA   BUYING

IMC Plan

– An IMC plan outlines all the advertising or marketing communication activities.

– Usually done on an annual basis– Companies may develop a campaign plan,

which is more tightly focused on solving a particular marketing communication problem.

– A campaign plan typically includes a variety of messages carried in different media and sometimes targeted to different audiences.

Regulation of Promotion

Self-Regulation

• Association of Advertising council Central Regulation

• Ministry of IB

•Situation analysis •Marketing objectives •Marketing budget •Marketing strategies •Marketing tactics •Evaluation of performance

STEPS of IMC Plan

Message strategy

– Key Consumer Insight

– Big Idea

– Executions

Examples of Niche Agencies

• Media shops – Mindshare, Madison, Starcom

• Creative boutiques – Ray and Kesavan

• Event management agencies- Wizcraft

• Sales Promotion agencies• Direct marketing outfits – Lintas Direct

• PR houses – Genesis • Research suppliers – MARG, IMRB, Nielsen

Effects of communication

From Grunig & Hunt (1984)Message Knowledge AttitudeBehaviour

Domino Domino DominoDomino

Media evaluation system

• Influence or tone

• Message communicated

• Prominence

• Audience reached

• Consultant/spokesman quoted

• Type of article

Evaluation model

Source: Macnamara

OUTTAKE

OUTPUT

OUTCOMEChange

behaviour

Changeattitudes

Research methods

Quantitative surveys

Focus groups

Interviews

Response analysis

Media content analysis

Expert analysis

Feedback

Observations

Understand messages

Retain messages

Messages in the media

Message presentation

Message content

Media selection

Techniques for Setting Promotion Budgets

• All - You - Can - Afford

• Competitive Parity

• Percent of Sales

• Market Share

• Objective and Task

Elements of the Promotion Mix

Advertising

Ingredientsof the

PromotionMix

Ingredientsof the

PromotionMix

Public Relations

Personal Selling

Sales Promotion

Internet Promotion

When Elements of Promotion Are Most Useful

Advertising

Personalselling

Salespromotion

Publicrelations

Either not effective or inefficient

Very effective

Somewhat effective

Awareness Knowledge Liking Preference Conviction

Eff

ecti

ven

ess

Purchase

Factors that Affect the Promotion Mix

Push–and–Pull Strategies

Nature of the Product

Stage in the Product Life Cycle

Target Market Characteristics

Type of Buying Decision

Promotion budget

Creating a Promotion Plan

Choose Promotion Mix

Develop Promotion Budget

Set Promotion Objectives

Identify Target Market

Analyze the Marketplace

Criteria for Setting Promotion Objectives

Promotion objectives should:

be measurable, concrete

be based on sound research, with a well-defined target audience

be realistic

reinforce the overall marketing plan and relate to specific marketing objectives

Examples of Promotion Objectives

Objective: To RemindTo remind consumers that Peter Pan peanut butter is the creamiest peanut butter and is available at their nearest grocery and convenience stores

Objective: To Inform (Awareness)To increase the top-of-mind awareness level for Peter Pan peanut butter from 16 percent to 24 percent

Objective: To Persuade (Attitudinal)To increase the percentage of parents who feel that Peter Pan peanut butter is the best peanut butter for their children from22 percent to 35 percent

Effects of Advertising

Advertising Spending

Re

turn

on

Ad

ver

tis

ing

Ex

pe

nd

itu

res

Increasing efficiencyas ad budget becomessufficient

Diminishingreturnson additionalspending

Major Types of Advertising

Corporate Image

Advocacy Advertising

Typesof

Advertising

Typesof

AdvertisingPioneering

Competitive

Comparative

ProductAdvertising

InstitutionalAdvertising

Advertising Campaign Decision Process

Determine the campaign objectives.

Make creative decisions. Make media decisions.

Evaluate the campaign.

Common Advertising Appeals

ProfitProfit

HealthHealth

Love or RomanceLove or Romance

FearFear

AdmirationAdmiration

ConvenienceConvenience

Fun and PleasureFun and Pleasure

Vanity and EgotismVanity and Egotism

Save money, keep from losing moneySave money, keep from losing money

Body-conscious, healthyBody-conscious, healthy

Sell cosmetics and perfumesSell cosmetics and perfumes

Social embarrassment, growing old, losing health, power

Social embarrassment, growing old, losing health, power

Celebrity endorsement effectiveCelebrity endorsement effective

Fast-food and microwave productsFast-food and microwave products

Vacations, beer, amusement parksVacations, beer, amusement parks

Expensive, conspicuous itemsExpensive, conspicuous items

Executional Styles for Advertising

Mood or Image

Musical

Demon-stration

Scientific

Real/AnimatedProductSymbols

Fantasy

Lifestyle

Spokes-person/

Testimonial

Slice-of-Life

Humorous

CommonExecutional

Styles

CommonExecutional

Styles

Methods Used to Evaluate Advertising Campaigns

Pretests

Examples:

• Consumer jury tests

• Portfolio or unfinished rough tests

• Physiological tests

Post-testsExamples:

• Recognition tests

• Recall tests

• Attitude measures

• Audience size measurement

The Tools of Public Relations

MajorTools

Used ByPR

Agency

MajorTools

Used ByPR

Agency

New Product Publicity

Product Placement

Customer SatisfactionPhone Lines

Consumer Education

Event Sponsorship

Issue Sponsorship

Web Sites

Tools for Consumer Sales Promotion

Coupons

Premiums

Frequent Buyer Programs

Contests and Sweepstakes

Samples

Point-of-PurchaseDisplays

SixCategories

ofConsumer

SalesPromotions

SixCategories

ofConsumer

SalesPromotions

Tools for Trade Sales Promotion

Trade Allowances

Push Money

Training

Free Merchandise

Store Demonstrations

Business Meetings, Conventions, Trade-Shows

SixCategories

ofTradeSales

Promotions

SixCategories

ofTradeSales

Promotions

Advantages of Personal Selling

Cost ControlCost Control

Message ControlMessage Control

TargetedTargeted

Detailed Information

Detailed Information

Closing SalesClosing Sales

Advertising Versus Personal Selling

Personal Selling is more important if...

The product has a high value.It is a custom-made product.There are few customers.The product is technically complex.Customers are geographically concentrated.

Advertising/Sales Promotion is more important if...

The product has a low value.It is a standardized product.There are many customers.The product is simple to understand.Customers are geographically dispersed.

Differences Between Traditional & Relationship Selling

Traditional Personal Selling

Sell products (goods and services)

Focus on closing sales

Limited sales planning

Spend most contact time telling customers about product

Conduct “product-specific” needs assessment

“Lone-wolf” approach to the account

Proposals and presentations basedon pricing and product features

Sales follow-up focused on product delivery

Relationship Selling

Sell advice, assistance, and counsel

Focus on improving the customer’s bottom line

Considers sales planning as top priority

Spend most contact time attempting to build a problem-solving environment with the customer

Conduct discovery in the full scope of the customer’s operations

Team approach to the account

Proposals and presentations based on profit impact and strategic benefits to the customer

Sales follow-up is long term, focused on long-term relationship enhancement

Source: Robert M. Peterson, Patrick L. Shul, and George H. Lucas, Jr., “Consultative Selling: Walking the Walk in the New Selling Environment,” National Conference on Sales Management, Proceedings, March 1996.

Steps in the Selling Process

BasicSteps in

theSelling

Process

BasicSteps in

theSelling

Process

Generating Sales Leads

Qualifying Sales Leads

Making the Sales Approach

Making the Sales Presentation

Handling Objections

Closing the Sale

Following Up

Functions of Sales Management

Motivate Sales Force

Evaluate Sales Force

Manage Turnover

Train Sales Force

Develop Compen-

sation Plan

Structure Sales Force

Determine Sales Force

Size

Recruit Sales Force

Set Sales Objectives

Major Tasks of Sales

Management

Major Tasks of Sales

Management

Cost Determinants of Price

01 2 3 4 5 6 7 8 9 10

50

100

150

200

Do

llars

Quantity

MC

ATC

AVC

AFC

Break-Even Analysis

Quantity (units)

Pri

ce

($)

Fixed Costs

Total Revenue

Total Costs

Profits

Losses

Break Even

Steps in Setting the Right Price

$ $ $ $ $ $ $ $$ $ $ $ $ $ $ $

Fine-Tune Base Price

Choose Strategy

Estimate Demand, Costs, and Profits

Establish Pricing Goals

Right Price

Legal and Ethical Issues in Pricing

Unfair Trade Practices

Key Legaland Ethical

IssuesRelated to

Price

Key Legaland Ethical

IssuesRelated to

Price

Price Fixing

Price Discrimination

Predatory Pricing

CashDiscount

QuantityDiscount

FunctionalDiscount

Trade Loading

EDLP

SeasonalDiscounts

PromotionalAllowances

Rebates

Discounts, Allowances, and Rebates

PriceReductions

PriceReductions

Geographic Pricing

Basing-Point

Freight-Absorption

Zone Pricing

Uniform Delivered

FOB Origin

PricingTactics

Based onGeography

PricingTactics

Based onGeography

Special Pricing Tactics

Odd-EvenPricing

Two-PartPricing

BundlePricing

BaitPricing

PriceLining

FlexiblePricing

ProfessionalServices

LeaderPricing

SinglePrice

CommonSpecial Pricing

Tactics

CommonSpecial Pricing

Tactics