15
CHAPTER
Integrated Marketing
Communications
Chapter Objectives
1 Explain how integrated
marketing communications
relates to the development
of an optimal promotional
mix.
2 Describe the communication process and
how it relates to the AIDA
concept.
3 Explain how the
promotional mix relates to
the objectives of
promotion.
4 Identify the different
elements of the
promotional mix and
explain how marketers
develop an optimal
promotional mix.
5 Describe the role of
sponsorships and direct
marketing in integrated
marketing
communications.
6 Discuss the factors that
influence the
effectiveness of a
promotional mix.
7 Contrast pushing and
pulling strategies.
8 Explain how marketers
budget for and measure
the effectiveness of
promotion.
Discuss the value of
9 marketing
communications.
CHAPTER 15 Integrated Marketing Communications
INTEGRATED MARKETING COMMUNICATIONS
• Promotion Communication link between buyers and sellers;
the function of informing, persuading, and influencing a
consumer’s purchase decision.
• Marketing communications Messages that deal with
buyer-seller relationships.
• Integrated marketing communications (IMC) Coordination
of all promotional activities to produce a unified, customerfocused promotional message.
• Consumers receive many marketing messages all day.
• Strategy begins with their wants or needs and then works backward to
product.
• Must segment market according to customer demographics and
preferences.
CHAPTER 15 Integrated Marketing Communications
IMPORTANCE OF TEAMWORK
• Requires consistent, coordinated promotional effort at every stage of
customer contact.
• Involves both in-house resources and outside vendors.
ROLE OF DATABASES IN EFFECTIVE IMC PROGRAMS
• Internet allows companies to gather information faster and organize it more
easily.
• Ability to harness data challenges ability to sift through it effectively.
• Direct sampling also provides customer opinions.
CHAPTER 15 Integrated Marketing Communications
THE COMMUNICATION PROCESS
• Effective message does three things:
• Gains the receiver’s attention.
• Achieves understanding by both sender and receiver.
• Stimulates receiver’s needs and suggests appropriate means of
satisfying them.
• AIDA concept Steps through which an individual reaches a purchase
decision: attention, interest, desire, and action.
• AIDA concept is vital for understanding an reaching customers.
• Noise can be a particular issue in international communications, including
in the world’s 74 English-speaking countries.
CHAPTER 15 Integrated Marketing Communications
OBJECTIVES OF PROMOTION
PROVIDE INFORMATION
• Goal is informing the market about the availability of a product.
INCREASE DEMAND
• May increase primary demand, or desire for a particular product category.
• May increase selective demand, or desire for a specific brand.
CHAPTER 15 Integrated Marketing Communications
DIFFERENTIATE THE PRODUCT
• Differentiation allows firms more control over marketing variables such as
price.
ACCENTUATE THE PRODUCT’S VALUE
• Greater value helps justify a higher price in the marketplace.
• Marketers advise staying away from these words—quality, value, service,
caring, and integrity—because they are overused and vague.
STABILIZE SALES
• Can help make demand more consistent throughout the year.
CHAPTER 15 Integrated Marketing Communications
ELEMENTS OF THE PROMOTIONAL MIX
• Promotional mix Subset of the marketing mix in which marketers attempt
to achieve the optimal blending of the elements of personal and nonpersonal
selling to achieve promotional objectives.
• Personal selling, advertising, and sales promotion usually account
for the bulk of a firm’s promotional expenditures.
PERSONAL SELLING
• Oldest form of selling.
• A seller’s promotional presentation conducted on a person-to-person basis
with the buyer.
• More than 13 million people in U.S. have careers in personal sales.
CHAPTER 15 Integrated Marketing Communications
NONPERSONAL SELLING
• Advertising and product placement.
• Sales promotion Marketing activities other than personal selling,
advertising, guerrilla marketing, and public relations that stimulate consumer
purchasing and dealer effectiveness.
• Trade promotion—incentives to encourage marketing intermediaries to sell
more of certain items or product lines.
• Direct marketing Direct communications, other than personal sales
contacts, between buyer and seller, designed to generate sales, information
requests, or store or Web site visits.
• Public relations Communications and relationships with various publics.
• Publicity—nonpersonal stimulation of demand unpaid placement of news
about it or through a favorable presentation of it on the radio or television.
• Guerrilla marketing Unconventional, innovative, and low-cost marketing
techniques designed to get consumers’ attention in unusual ways.
CHAPTER 15 Integrated Marketing Communications
SPONSORSHIPS
• $28 billion business worldwide.
• Sponsorship Relationship in which an organization
provides funds or in-kind resources to an event or activity
in exchange for a direct association with that event or
activity.
• Sponsor purchases access to event’s audience and image
associated with activity.
• Sponsorship often more cost effective but usually offers
less control over market coverage.
• Audiences often view sponsorship more positively than
advertising.
CHAPTER 15 Integrated Marketing Communications
DIRECT MARKETING
• Effective—for every $1 spent, firms typically receive $11.49 in revenue.
• Opens large new international markets and promotes goals beyond creating
product awareness.
• Databases are an important tool.
DIRECT MARKETING COMMUNICATION CHANNELS
• Direct mailings such as brochures and catalogs.
• Telecommunications and television and radio.
• Internet via e-mail and electronic messaging.
• Print media such as newspapers and magazines.
• Specialized channels such as electronic kiosks.
CHAPTER 15 Integrated Marketing Communications
DIRECT MAIL
• Allows narrow targeting, intensive coverage, and other benefits.
• Per reader cost is high and many consumer view it as junk.
CATALOGS
• Catalog sales reached $160 billion in a recent year.
• Companies adding online catalogs to complement print catalogs.
TELEMARKETING
• Most frequently used form of direct marketing.
• Provides a high return on expenditures, an immediate response, and the
opportunity for personalized two-way conversations.
• May be outbound or inbound.
• 1996 Telemarketing Sales Rule created Do Not Call Registry and curtailed
abusive telemarketing practices.
CHAPTER 15 Integrated Marketing Communications
DIRECT MARKETING VIA BROADCAST CHANNELS
• Brief direct-response advertisements on television or radio.
• Home shopping channels.
• Infomercials.
ELECTRONIC DIRECT MARKETING CHANNELS
• U.S. spending on online advertising totals about $16 billion per year.
• Includes Web advertising and e-mail notices.
• Online customer acquisition programs often cost less than traditional ones.
OTHER DIRECT MARKETING CHANNELS
• Print media and other traditional channels are critically important.
• Kiosks also provide an outlet for electronic sales.
CHAPTER 15 Integrated Marketing Communications
PULLING AND PUSHING PROMOTIONAL
STRATEGIES
• Pulling strategy Promotional effort by the seller to stimulate final-user
demand, which then exerts pressure on the distribution channel.
• Pushing strategy Promotional effort by the seller directed to members of
the marketing channel rather than final users.
• Advertising creates an environment for successful personal selling and
remains important as an affirmation of customer’s decision.
CHAPTER 15 Integrated Marketing Communications
BUDGETING FOR PROMOTIONAL STRATEGY
• Composition of budget depends on strategy.
• B2B markets often allocate more to personal selling than
advertising.
• Reverse is usually true for consumer goods.
CHAPTER 15 Integrated Marketing Communications
MEASURING THE EFFECTIVENESS
OF PROMOTION
• Direct sales results test to reveal impact on sales revenues of promotional
spending.
• Indirect evaluation that focuses on quantifiable indicators of effectiveness.
• Two major ways of setting Internet advertising rates:
• Cost per impression—cost relates to the number of people who
view the ad.
• Cost per response (click-throughs)—cost relates to the number of
people who click the ad.
CHAPTER 15 Integrated Marketing Communications
THE VALUE OF MARKETING
COMMUNICATIONS
SOCIAL IMPORTANCE
• One generally accepted standard in a market society is
freedom of choice for the consumer.
BUSINESS IMPORTANCE
• Long-term increase in funds allocated to promotion indicates faith in its
ability to encourage attitude changes, brand loyalty, and additional sales.
ECONOMIC IMPORTANCE
• Provides employment for millions of people.
• Increases units sold and allows economies of scale that mean lower prices,
which make a product available to more people.