• Integrated Marketing Communications:
Advertising, Promotions. And Other
MarCom Tools
LEARNING OBJECTIVES
Appreciate
the variety
marketing
• Appreciate
the of
variety
of marketing
communications
tools, and
howand
they
work
communications
tools,
how
they
togetherwork
to accomplish
communication
together to
accomplish
objectives
communication objectives.
• Understand the nature, importance, and
Understand
the nature,
importance,
and
features
of integrated
marketing
featurescommunications.
of integrated marketing
communications
• Describe the concept of brand-equity
enhancement and the role of marketing
communications
in facilitating this
Describe
the concept of brand-equity
objective.
enhancement
and the role of marketing
communications in facilitating this objective
LEARNING OBJECTIVES
Comprehend the factors that determine how
• Comprehend the factors that determine
differenthow
marketing
communications
elements
different
marketing communications
are effectively
combined
elements
are effectively combined.
• Discuss
the primary
decision
spheres
Discuss
the primary
decisions
spheres
involved
involved
managing
the marketing
in managing
the in
marketing
communications
process communications process.
• Know the major activities involved in
formulating
advertising
strategy.
Know the
major activities
involved
in
formulating advertising strategy
LEARNING OBJECTIVES
Recognize the role of sales promotion.
• Recognize the role of sales promotion,
Appreciate
the reasons
why this
form
of form of
appreciate
the reasons
why
this
marketing
communication
has experienced
marketing
communication
has
rapid growth,
and know
the
tasks that
can the
experienced
rapid
growth,
and it
know
and cannot
accomplish
tasks
that it can and cannot accomplish.
• Evaluate
theand
nature
and function
Evaluate
the nature
function
of publicof public
relations.
relations
• Appreciate sponsorship marketing and
the sponsorship
practices of event
marketing
and
Appreciate
marketing
and the
cause-related
marketing
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
THE TOOLS OF MARKETING
COMMUNICATIONS
Advertising
Personal
Selling
Publicity
MarCom Mix
Sales
Promotion
P-O-P
Sponsorship
Personal Selling
• Person-to-person
communication in
which a seller
informs and
educates
prospective
customers and
attempts to
influence their
purchase choices.
THE TOOLS OF MARKETING
COMMUNICATIONS
Advertising
Personal
Selling
Publicity
MarCom Mix
Sales
Promotion
P-O-P
Sponsorship
Advertising
• 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.
THE TOOLS OF MARKETING
COMMUNICATIONS
Advertising
Personal
Selling
Publicity
MarCom Mix
Sales
Promotion
P-O-P
Sponsorship
Publicity or Public Relations
• Non-personal
communication to a
mass audience that
is not directly paid
for by the company.
THE TOOLS OF MARKETING
COMMUNICATIONS
Advertising
Personal
Selling
Publicity
MarCom Mix
Sales
Promotion
P-O-P
Sponsorship
Sales Promotion
• All the marketing
activities that
attempt to promote
immediate sales of a
product.
THE TOOLS OF MARKETING
COMMUNICATIONS
Advertising
Personal
Selling
Publicity
MarCom Mix
Sales
Promotion
P-O-P
Sponsorship
Sponsorship
• The practice of
promoting the
interests of a
company and its
brands by
associating the
company with a
specific event.
THE TOOLS OF MARKETING
COMMUNICATIONS
Advertising
Personal
Selling
Publicity
MarCom Mix
Sales
Promotion
P-O-P
Sponsorship
Point-of-Purchase (P-O-P)
• Includes all signage
(displays, posters,
signs, shelf cards,
and other visual
materials) designed
to influence buying
decisions at the
point of sale.
KEY PARTICIPANTS IN MARKETING
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
Advertising
Personal
Selling
Publicity
MarCom
Integrated
Marketing
Communications
Sales
Promotion
P-O-P
Sponsorship
Key Aspects of Integrated Marketing
Communications
Starts with the Customer
• 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
Key Aspects of Integrated Marketing
Communications
Use Any Form of Relevant Contact
• 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
Key Aspects of Integrated Marketing
Communications
Achieve Synergy
• Another key aspect of IMC is the
need for synergy
• All communication elements
should convey the same, unified
message, otherwise consumers
will be confused
Key Aspects of Integrated Marketing
Communications
Build Relationships
• 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
Key Aspects of Integrated Marketing
Communications
Affect Behavior
• More than awareness or attitude
changes but must include
behavioral changes
• Moving people to action
Key Changes in MarCom Practice
Resulting from the IMC Thrust
1. Reduced Dependence in Mass-Media Advertising
2. Increased reliance on highly targeted
communications methods
3. Expanded efforts to assess return on investment
THE MARCOM CHALLENGE: ENHANCE
BRAND EQUITY
Brand
Recognition
• Figure 12.1
Brand
Awareness
Brand
Recall
Attributes
Types of
Brand Associations
Benefits
Favorability,
Strength, and
Uniqueness of
Brand Association
Overall
Evaluation
(Attitude)
Brand
Knowledge
Brand
Image
Brand Equity
• 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
Awareness
Brand
Image
Brand Awareness
• Whether a brand name comes
to mind when consumers think
about a particular product
category and the ease with
which the name is evoked
Brand
Awareness
Brand
Image
Brand Image
• 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
Brand
Awareness
Brand
Image
DETERMINING AN APPROPRIATE MIX
OF IMC TOOLS
Market
Objectives
Nature of the Product
Life-cycle Stage
Competitive Actions
Budget
Push vs. Pull
• Who is the
intended market?
• Business-tobusiness market
or consumer
market?
• Understanding of
the product’s
target market
DETERMINING AN APPROPRIATE MIX
OF IMC TOOLS
Market
Objectives
Nature of the Product
Life-cycle Stage
Competitive Actions
Budget
Push vs. Pull
• What are the
objectives?
• Do we want to
create product
category wants or
brand preference?
The Hierarchy of Effects
Purchase
• Insert Figure 12.2
Purchase Intention
Attitude
Beliefs/Knowledge
Awareness
Unawareness
DETERMINING AN APPROPRIATE MIX
OF IMC TOOLS
Market
Objectives
Nature of the Product
Life-cycle Stage
Competitive Actions
Budget
Push vs. Pull
• What is the nature
of the product?
• Business-tobusiness products
versus consumer
goods
DETERMINING AN APPROPRIATE MIX
OF IMC TOOLS
Market
Objectives
Nature of the Product
Life-cycle Stage
Competitive Actions
Budget
Push vs. Pull
• What is the
product life-cycle
stage?
• New product
versus a mature
product
DETERMINING AN APPROPRIATE MIX
OF IMC TOOLS
Market
Objectives
Nature of the Product
Life-cycle Stage
Competitive Actions
Budget
Push vs. Pull
• What are
competitors
doing?
• Does the
competition allow
trade allowances
and, if so, how
large?
DETERMINING AN APPROPRIATE MIX
OF IMC TOOLS
Market
Objectives
Nature of the Product
Life-cycle Stage
Competitive Actions
Budget
Push vs. Pull
• What is the
available budget
for promotion?
• Do we emphasize
personal selling or
mass advertising?
DETERMINING AN APPROPRIATE MIX
OF IMC TOOLS
Market
Objectives
Nature of the Product
Life-cycle Stage
Competitive Actions
Budget
Push vs. Pull
• 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. Pull Strategy
Push
Strategy
VS
Pull
Strategy
Push Strategy
• Utilizes aggressive
trade allowances
and personal
selling to obtain
wholesaler and
retailer distribution
• The product is
pushed through
the channel
Pull Strategy
• Encourages
consumer demand
for the product to
obtain distribution
• Use of heavy
advertising and
high value coupons
MANAGING THE MARCOM PROCESS
Selecting Target Market
Establishing Objectives
Formulating a Positioning
Strategy
Setting Budget
Formulating and Implementing
Message and Media Strategies
Evaluating Program
Effectiveness
MANAGING THE MARCOM PROCESS
Selecting Target Market
• 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)
MANAGING THE MARCOM PROCESS
Establishing Objectives
• 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
MANAGING THE MARCOM PROCESS
Formulating a Positioning Strategy
• 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
MANAGING THE MARCOM PROCESS
Setting Budget
• 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
used
MANAGING THE MARCOM PROCESS
Formulating and Implementing
Message and Media Strategies
• 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
MANAGING THE MARCOM PROCESS
Evaluating Program Effectiveness
• 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)
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
ADVERTISING STRATEGY
Budgeting
Establishing
the Brand
Positioning
Objective
Setting
Assessing
Advertising
Effectiveness
Creating
Advertising
Messages
Selecting
Advertising
Media
ADVERTISING STRATEGY
Objective
Setting
• 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
ADVERTISING STRATEGY
Budgeting
• 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
Budgeting for Advertising
Percent of Sales
Objective &Task
• Promotional budget
set as a percentage
of past or
anticipated sales
Budgeting for Advertising
Percent of Sales
Objectives &Task
• Objectives specified
• Promotional
elements identified
• Budget is
determined by
accumulating
anticipated costs
among the various
promotional
elements
ADVERTISING STRATEGY
Establishing
the Brand
Positioning
• 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
ADVERTISING STRATEGY
Creating
Advertising
Messages
• 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 Advertising Messages
• Informational ads
Creating Advertising Messages
• Humorous
executions
Creating Advertising Messages
• Sex appeals
Creating Advertising Messages
• Sex appeals
Creating Advertising Messages
• Celebrity
endorsements
Creating Advertising Messages
• Emotional appeals
Creating Advertising Messages
• Using animation
Creating Effective Messages
•
•
•
•
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
Creative Campaigns
• Absolut
Creative Campaigns
• Absolut
Creative Campaigns
• Absolut
Creative Campaigns
• Absolut
Creative Campaigns
• Milk
Creative Campaigns
• Milk
Creative Campaigns
• Milk
Creative Campaigns
• Milk
Creative Campaigns
• Insert Figure 12.5
ADVERTISING STRATEGY
Selecting
Advertising
Media
• 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 Advertising Media
Selection of Target Audience
Specification of Media
Objectives
Selection of Media
Purchase of Media
Selecting Advertising Media
Selection of Target Audience
• Must be clearly pinpointed
• Based on geographic factors,
demographics, product-usage
concerns, psychographics
Selecting Advertising Media
Specification of Media
Objectives
•
•
•
•
Reach
Frequency
Continuity
Cost
Selecting Advertising Media
Selection of Media
•
•
•
•
•
Television
Radio
Magazines
Newspapers
Internet
Selecting Advertising Media
• Insert Figure 12.6
Selecting Advertising Media
Purchase of Media
Cost
___________
CPM=
Audience Size
GRP=Reach*Frequency
CPM
Match Target Image
... Overall
Magazine1
Magazine2
Magazine3
...
...
Magazine N
•
•
Cost per thousand (CPM)
Gross rating points (GRP)
ADVERTISING STRATEGY
Assessing
Advertising
Effectiveness
• 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
Direct Advertising
• Database Marketing Offers
Addressability
Measurability
Flexibility
Accountability
SALES PROMOTION
• The use of any incentive
by a manufacturer to
induce the trade
(wholesalers and retailers)
or consumers to buy a
brand and to encourage
the sales force to
aggressively sell it
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
space
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
PUBLIC RELATIONS
Proactive MPR
• 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
PUBLIC RELATIONS
Reactive MPR
• 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
SPONSORSHIP MARKETING
Event Marketing
• Form of a brand promotion that ties
a brand to a meaningful cultural,
social, athletic, or other type of highinterest public activity
• Separate from advertising, sales
promotion, point-of-purchase
merchandising, or public relations
SPONSORSHIP MARKETING
Cause-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
SPONSORSHIP MARKETING
Cause-Related Marketing
• Stride Rite
POINT-OF-PURCHASE
COMMUNICATIONS
Consumers
Retailers
Manufacturers
• P-O-P delivers useful information and
simplifies the shopping process by setting
products apart from similar items
POINT-OF-PURCHASE
COMMUNICATIONS
Retailers
Consumers
Manufacturers
• Increased sales
• Enables retailers to better organize shelf space
and improve inventory control, volume, and
profitability
POINT-OF-PURCHASE
COMMUNICATIONS
Manufacturers
Consumers
Retailers
• 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
Supplemental Material
Communication Process
Message
Encoding
Source
Channel
Receiver
Noise
Decoding
Feedback
Communication Process
Message
Channel
Encoding
Receiver
Decoding
Noise
Source
• The marketer
• The sender of the message
Feedback
Communication Process
Message
Encoding
Source
Channel
Receiver
Decoding
Noise
Feedback
• Designing of advertisements, sales presentations,
P-O-P displays, etc.
• Translation of the message into symbolic form
Communication Process
Message
Channel
Encoding
Receiver
Decoding
Noise
Source
Feedback
• Actual advertisement that contains the intended message
• Symbolic expression of the sender’s thoughts
Communication Process
Message
Channel
Encoding
Receiver
Decoding
Noise
Source
Feedback
• Television, radio, print media, telephone, direct mail, etc.
• Path through which the message moves to get to the receiver
Communication Process
Message
Channel
Encoding
Receiver
Decoding
Noise
Source
Feedback
• Person or groups of persons for whom the message is intended
Communication Process
Message
Channel
Encoding
Noise
Source
Receiver
Decoding
Feedback
• Process receiver uses to interpret the meaning of the message
Communication Process
Message
Channel
Encoding
Receiver
Decoding
Noise
Source
Feedback
• Marketing research, market share changes, sales reports
• Attitude changes, purchase or non-purchase
• Gauge of effectiveness of communication techniques
Communication Process
Message
Channel
Encoding
Noise
Source
Receiver
Decoding
Feedback
• Interference at some stage in communications process
• Competitive promotional messages
• Misinterpretation of message or wrong receiver
Functions Of Advertising
Inform
Persuade
Remind
Add Value
Assist Other Efforts
• Makes consumers
aware of new products
• Informs them about
specific brands
• Educates them about
particular product
features & benefits
Functions Of Advertising
Inform
Persuade
Remind
Add Value
Assist Other Efforts
• Persuade customers to
try new products,
brands & services
• Create demand for
entire product
category
• Build secondary
demand
Functions Of Advertising
Inform
Persuade
Remind
Add Value
Assist Other Efforts
• Keeps company’s
brand fresh in
consumer’s memory
• Create top-of-mind
awareness
Functions Of Advertising
Inform
Persuade
Remind
Add Value
Assist Other Efforts
• Innovation
• Improving quality
• Altering consumer
perceptions
Functions Of Advertising
Inform
Persuade
Remind
Add Value
Assist Other Efforts
• Delivering sales
promotions
• Assist sales
representatives
• Pre-sell products
• Provide salespeople
with valuable
introduction
Communication Objectives
Build
Products
Wants
Create
Brand
Awareness
Enhance
Attributes
Intentions
Facilitate
Purchase
Communication Objectives
• Marketers must first build
product category wants or
primary demand
Build Products Wants
Create Brand Awareness
Enhance Attributes/Intentions
Facilitate Purchase
Communication Objectives
• After a product category is
established, marketers
attempt to create
secondary demand for their
specific brand
Build Products Wants
Create Brand Awareness
Enhance Attributes/Intentions
Facilitate Purchase
Communication Objectives
• After creating secondary
demand, marketers want to
influence attitudes and
intentions
Build Products Wants
Create Brand Awareness
Enhance Attributes/Intentions
Facilitate Purchase
Communication Objectives
• Marketing communication
variables can facilitate
purchase and overcome
other marketing mix
variables
Build Products Wants
Create Brand Awareness
Enhance Attributes/Intentions
Facilitate Purchase
Hierarchy-of-Effects Models
Specific Stage
Purchase
Summary Term
Connotation
Purchase Intention
Attitude
Affect
Beliefs/Knowledge
Cognition
Awareness
Unawareness
Precognition
Methods Of Setting Promotions Budgets
Meeting Competition
Past Sales
Task/Objective
• Match competitors’
actions
• Meeting competitor’s
budget doesn’t allow
firm to meet its own
objectives
Methods Of Setting Promotions Budgets
Meeting Competition
Past Sales
Task/Objective
• Sets promotional
budget based on past
or anticipated sales
• Limited by forecast
reliability
Methods Of Setting Promotions Budgets
Meeting Competition
Past Sales
Task/Objective
• Objectives
specified
• Promotional
elements identified
• Budget determined
by costs needed to
reach objectives