STRATEGIC MARKETING PROBLEMS BY KERIN AND PETERSON (12TH ED.)
LECTURE NOTES
Presented by:
Almin Jasarević, Almedin Skopljaković
Chapter 6. Integrated Marketing Communication Strategy and Management
Definition : Marketing communication is the process by which information about an organization and its offerings is disseminated to selected markets .
Goal of Marketing Communication:
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Induce initial purchase
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Achieve post purchase satisfaction – increasing the probability of repeat sales
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Purpose of Marketing Communication
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Communication is necessary to inform buyers of the following:
- The availability of an offering
- The unique benefits of the offering
- The where and how of obtaining and using the offering
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Marketing Communication Mix
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Advertising
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Personal selling
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Sales promotion
 It is responsibility of the marketing manager to find the most effective communication mix at the least possible cost.
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Integrated Marketing Communications (IMC)
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The practice of blending different elements of the communication mix in mutually reinforcing ways to inform, persuade, and induce customer action.
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Advertising might be employed to develop offering awarness and consideration
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Sales promotion might be used to incerase purchase intention
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Personal selling might be utilized to obtain final conviction and purchase
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IMC Strategy Framework;
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What are the information requirements of target markets as they proceed through the purchase decision?
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What objectives must the communication strategy achieve?
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How might the mix of communication activities be combined to convey information to target markets?
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What should the budget be and how should resources be allocated?

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How should it be timed and scheduled?
 How should it be evaluated and controlled?

Information Requirements in Purchase Decisions - Purchase Process Model
Awarness – Consideration – Preference - Purchase
At any point in the time, different buyers are in different stages of the model, and each stage requires a different communication strategy.
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Determine how buyers purchase a particular offering (Roles played by individuals in the buying center)
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Define the role of information in the purchase process (When, where, how, and what information is used for decision making)
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Determine the perception that consumers have of the organization and the offering
(Sources from which information is sought)

Setting Reasonable Communication Objectives
Objectives will differ according to whether the strategy being employed ( market penetration, market development, or product development) and the stage of product or service life cycle
( Build primary demand - demand for the product or service class; Build selective demand - demand for a particular brand, product, or service)
Requirements:
Consistent - Both among themselves and with other marketing elements
Quantifiable - For measurement and control purposes
Attainable - With an appropriate amount of effort and expenditure and within a specific time frame

Developing an IMC Mix
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Factors to be Considered
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The information requirements of potential buyers (Identification of the relative value of communication tools at various stages in the purchase-decision process; consumer touch point – where, when and how a customer comes in contact with a product

Advertising creates awareness

Salespeople provide information

Sales promotion, brochures, and catalogs provide descriptions and stimulate trial

The nature of the offering

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Advertising is useful when an offering is not complex, is frequently purchased, is relatively inexpensive, or has benefits that differentiate it from competition

Personal selling is required when a product is relatively expensive or its benefits are not readily apparent

Sales promotion lends itself to nearly every offering type because of the wide variety of forms it can assume

The nature of the target market
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Advertising is effective for communicating an offering to a mass market that is geographically scattered
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Direct marketing (e.g., Internet) can also be used to reach a geographically dispersed target market
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Personal selling is useful when a small number of buyers live in close proximity and purchase large quantities
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The capacity of the organization
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Make-or- buy-decisions – should communication activity perform internally or outsource it?

Perform the activity internally ( Company sales force, Fixed and variable costs, More control, Flexibility, Focused sales effort, Greater availability)

Outsource it ( Independent sales representatives, Variable costs only,
Acceptable control, Lower personnel costs, Greater flexibility, Increased sales effort)
 Push and Pull Strategies
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Push strategies (Producer - Retailers and Wholesalers – Consumers)

Offering is pushed through a marketing channel in a sequential fashion, with each channel level representing a distinc target market

Push strategy is typically used when an organization has easily identifiable buyers, the offering is complex, buyers view the purchase as being risky, a product or service is early in its life cycle, the organization has limited funds for direct-to-consumer advertising

Pull Strategies (Producer – Consumers – Retailers and Wholesalares)
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Seeks to create initial interest among potential buyers, who in turn demand the offering from intermediaries, utimately pulling the offering through a marketing channel.


Identifying an Advertising Opportunity (There is a favorable primary demand for a product or service category, the product or service to be advertised can be significantly differentiated from its competitors, the product or service has hidden qualities or benefits that can be communicated through advertising, there are strong emotional buying motives involved, such as for health, beauty, or safety)
 Marketing Web Sites and IMC
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Transactional Sites (Focus on turning an online browser into an online buyer)
Successful transactional Web sites feature:
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Well-known, branded products and services
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Favorable shopping and buying experiences (e.g., Gap.com)
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Promotional Sites (Promote a company’s products and services and provide information on how items can be used and where they can be purchased

Can have games, contests, quizzes with electronic coupons and other gifts and prizes
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Can also be used to create a buzz (word of mouth behavior)
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Viral Sites (Encourages individuals to forward marketer-initiated messages to others via e-mail)
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Is to offer consumers discounts for referrals
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Leveraging Advertising and Personal Selling with Promotion Web Site
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Promotional Web sites and the Internet/Web-enabled technology that supports them can leverage advertising and personal selling efforts

Communication Mix Budgeting
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Make the budget commensurate with the tasks required of the communication activities
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Establishing the size of a communication budget:
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Formula-based guidelines
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Percentage of sales approach (Past sales or anticipated sales can be used for this approach)
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Per unit method (Multiply per unit spending with expected sales volume)
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Qualitatively-based guidelines

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Competitive-party approach (Maintain a parity between company’s communication expenditures and those of its competitors - Advertising share of voice)
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All available funds (When introducing a new offering)
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Objective-task approach
 Define the communication objectives
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Identify the tasks needed to attain the objectives
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Estimate the costs associated with the performance of these tasks
This method is typically considered the best approach.
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Advertising Budget Allocation
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SIX media: Television, Radio, Magazine, Newspaper, Billboard, Internet

Each medium consists of vehicles that have specific characteristics

Media are mostly chosen based on: Cost, Reach Frequency, Audience characteristics, Purpose of the advertisement, Product needs,Editorial climate

Sales Force Budget Allocation
NS = NC x FC x LC/ TA
NS =number of sales people
NC =number of customers (actual or potential)
FC =necessary frequency of customer calls
LC =length of average customer call, including travel time
TA =average available selling time per salesperson (less administrative time)

Evaluation and Control of the Communication Process
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Continuous monitoring of the execution of any communication to ensure that communication objectives are being attained
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Should incorporate some measure of sales or profits
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Budgeting