INTEGRATED
MARKETING
COMMUNICATIONS
Dr. Vesselin Blagoev
19/03/2016
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Communications Mix
We call
Marketing communications mix
or Promotion mix
the specific mix of advertising, sales
promotion, personal selling, and public
relations that a company uses to pursue
its advertising and marketing objectives
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Promotion Mix
Advertising
Agency, Media, Effectiveness
Sales
Promotion
Point-of-sales
Packaging
Samples
Coupons
Contests
Direct mail
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Promotion
mix
Personal
Selling
Sales force
Management
Control
Public Relations
Company image, Contributions,
Lobbing
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Marketing
Communications System
Producer
Advertising
Sales promotion
Personal selling
Public relations
Publics
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Middlemen
Advertising
Sales promotion
Personal selling
Public relations
Word of
mouth
Consumers
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Elements in the
Communication Process
Sender
Encoding
Message
Decoding
Receiver
Media
Noise
Feedback
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Response
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Functions of Advertising
 To
differentiate products from
their competitors
 To communicate product
information
 To urge product use
 To expand product distribution
 To increase brand preference and
loyalty
 To reduce overall sales costs
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How to classify advertising
By Media Used
A/ Print
D/ Out of Home
– Newspaper
– Magazine
B/ Electronic
– Radio
– Television
– Channels
C/ Direct Mail
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- Outdoor (posters,…)
- Transit (busses, trams)
E/ Internet
- Web sites, blogs, podcasts
- E-mailing
- Banners
F/ Directories
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How to Classify Advertising
By Purpose
 Product
vs. Nonproduct (image oriented)
 Commercial vs. Noncommercial
 Primary demand vs. Selective
demand (for particular brand name)
 Direct action vs. Indirect action
Direct – toll free phone numbers, coupons,
limited time offers
Indirect – to build brand awareness
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AIDA Model
Attention
Interest
Desire
Action
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Advertising Objectives
 Informative
advertising: for a new
product or feature, and to build a primary demand
 Persuasive
advertising: to build selective
demand for a brand by persuading that it offers the
best quality for money
 Comparison
advertising: one brand to
another
 Reminder advertising: think about the
product
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Push and Pull Strategies
Pull Strategy
Push Strategy
Retailer
Consumer
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Mixed Form Push
Wholesaler
Manufacturer
Pure Form Push
Manufacturer
Wholesaler
Retailer
Consumer
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Buyer-Readiness States
Awareness
Knowledge
Liking
Preference
Conviction
Purchase
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Current Consumer States
for Two Brands
Brand A
20% not
aware
100%
market
Of
these
100%
80%
market
aware
Of
80%
aware
40%
did not try
60% tried
Of
those
who
tried
80%
disappointed
20% satisfied
100%
market
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Brand B
50% not
aware
Of
these
50%
aware
Of
50%
aware
50% did not
try
50% tried
Of
those
who
tried
80% satisfied
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Sales Promotion
Sales promotion (SP) consists of short-term
incentives to encourage purchase or sales of a
product or service
 Consumer promotion is SP designed to
stimulate consumer purchasing
 Trade promotion is SP designed to gain
reseller support and to improve reseller selling
efforts
 Salesforce promotion is SP designed to
motivate salesforce and make salesforce
selling
efforts more effective
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
Consumer-Promotion Tools
 Samples: offers of a trial amount of a product
 Coupons: certificates which give buyers
savings when they purchase specified products
(over 220 billion coupons/year in the USA)
 Rebates (Cash refund offers): like
coupons except that the price reduction is done
after the purchase and not in the retail outlet
 Price packs (Cents-off deals): savings
off regular price, marked by the producer on
the label
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Consumer-Promotion Tools
 Premiums: goods offered either free or at low
price as an incentive to buy a product
 Patronage rewards: cash or other awards
for the regular use of a certain company’s
products or services
 Point-of-purchase
(POP) promotions:
displays, signs, posters and demonstrations at the
point of sale
 Contests and Games: give consumers the
chance to win something by chance
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Trade-Promotion Tools
They are mostly directed to the middlemen (55%), than to consumers (45%):
Straight Discounts (Price-off, Offinvoice, Off-list): given by the producers for
different reasons, often for a quantity of order
 Advertising Allowances, or Display
Allowances: they compensate the retailers for

doing something, i.e. using special displays

Conventions, Trade Shows
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Personal selling
The work done by salesperson at different
positions:
Deliver the product, such as bread, milk
 Inside order taker – department store
salesperson standing behind the counter
 Outside order taker – in the packing room
 Building goodwill or educating customers –

calling doctors on behalf of a pharmaceutical company
Technical knowledge – consulting the client
 Creative sale of tangible products – houses,
encyclopedia, or intangibles – insurance, or education

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Major Steps in Effective
Personal Selling
Prospecting
and qualifying
Pre-approach
Approach
Presentation and
demonstration
Handling
objections
Closing
Follow-up
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Direct Marketing
 Telemarketing:
combines aspects of
advertising, marketing research and
personal interview (telephone)
 Relationship marketing: it costs 4-7
times as much to create a customer,
as it does to maintain a customer
 Integrated direct marketing (IDM):
 Marketing database
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Direct marketing
 Multiple-vehicle, multiple-stage campaign
Paid
add
with a
response
channel
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Direct
mail
mechanism
Outbound
telemarketing
Face-to-face
Sales call
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Outbound Telemarketing
 A company who uses outbound calling as a way
to build a client base to sell a product or service
is required by law to remove names from
their contact list if the contact requests them
to do so. It can be considered harassment
under the statutes of law if a company
repeatedly calls upon an individual or business
for the purposes of solicitation once they have
been asked to stop.
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Public Relations

Press relations: Placing newsworthy
information into the news media to attract
attention to a person, product, company
 Product publicity: Publicizing specific
products
 Corporate communications: Creating
communications to promote understanding of
the firm or institution
 Lobbying: Dealing with legislators and government
officials to promote specific policy
 Counseling: Advising managers about public
issues
and company positions and image 23
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Setting the Total
Promotion Budget
and Mix
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Relative Importance of
Promotion Tools in
Consumer vs. Industrial Markets
Consumer goods
Advertising
Sales promotion
Personal selling
PR
Industrial goods
Personal selling
Sales promotion
Advertising
PR
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Relative importance
Relative importance
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How much to spend?
“I know that half of my advertising is
wasted, but I don’t know which half.
I spent $2 million for advertising,
and I don’t know if that is half
enough or twice too much.”
John Wanamaker
Department store magnate
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How much to spend?
 Promotion
spending may be 2030% of sales in the cosmetics
industry and only 5-10% in the
industrial machinery industry.
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Methods to set the
Advertising Budget
Affordable
method
Percentage-of-Sales method
Competitive-Parity method
Objective-and-Task Method
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Affordable method
Simple
 If the boss asks me how much we must
spend, and I answer a figure, given to me by
the Finance Manager a day before, I am on
a solid ground. I know that the boss will
also call the Fin manager to ask him/her
how much we can afford to spend this year.
Long-range
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planning is difficult
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Percentage-of-Sales Method
 Promotion
spending is likely to vary with
what the company can afford
 It helps to feel better the relationship
between the price, promotion, and sales
 It supposedly creates competitive
stability – the direct competitors tend to
spend a similar percentage of their sales
on promotion

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But …
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Percentage-of-Sales Method
It mistakenly views sales as the cause of
promotion, rather than as the result
 The budget is based on availability of funds
rather than on opportunities
 It may prevent the increased spending
sometimes needed to turn falling sales around
 Long-range planning is difficult
 No other base for decision for the % but the
previous experience or competitors

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Competitive-Parity Method
Some companies get industry promotionspending estimates from publications or other
sources and set their budget on the industry
average
 First +: Competitors’ budgets represent the
collective wisdom of the industry
 Second +: Spending the same % helps to
prevent promotion wars
 Minus: Neither argument is valid

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Decoding in the
Communication Process
Sender
Encoding
Message
Decoding
Receiver
Media
Noise
Feedback
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Response
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