Integrated Marketing

CommunicationStrategy

The Marketing CommunicationsMix

AdvertisingAdvertising

Personal SellingPersonal Selling

Any Paid Form of Nonpersonal Presentation by an Identified Sponsor.

Any Paid Form of Nonpersonal Presentation by an Identified Sponsor.

Sales Promotion Short-term Incentives to Encourage Sales.

Public RelationsBuilding Good Relations with Various Publics by Obtaining Favorable Unpaid Publicity.

Direct MarketingDirect Communications With Individuals to Obtain an Immediate Response.

Personal Presentations by a Firm’s Sales Force.

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MediaMedia

SenderSender

EncodingEncoding

MessageMessage

DecodingDecoding

ReceiverReceiver

ResponseResponse

FeedbackFeedback

The Communication Process

Steps in Developing EffectiveCommunication

Step 1. Identifying the Target AudienceStep 1. Identifying the Target Audience

Step 2. Determining the Communication ObjectivesBuyer Readiness Stages

Step 2. Determining the Communication ObjectivesBuyer Readiness Stages

PurchasePurchase

Conviction

Preference

Liking

Knowledge

Awareness

Step 3. Designing a MessageStep 3. Designing a Message

Steps in Developing EffectiveCommunication

AttentionAttention InterestInterest DesireDesire

Message ContentRational Appeals

Emotional AppealsMoral Appeals

Message StructureDraw Conclusions

Argument TypeArgument Order

Message FormatHeadline, Copy, Color,

Words, & Sounds,Body Language

ActionAction

Nonpersonal CommunicationChannels

Steps in Developing EffectiveCommunication

Step 4. Choosing MediaStep 4. Choosing Media

Personal CommunicationChannels

Step 5. Selecting the Message SourceStep 5. Selecting the Message Source

Step 6. Collecting FeedbackStep 6. Collecting Feedback

Percentage-of-SalesMethod

Affordable Method

Competitive-Parity

Method

Objective-and-TaskMethod

Setting the Total Promotion Budget

Setting the Promotion Mix

Nature of Each Promotion Tool

AdvertisingReaches Many Buyers, Expressive

Impersonal

AdvertisingReaches Many Buyers, Expressive

Impersonal

Personal SellingPersonal Interaction, Builds Relationships

Costly

Personal SellingPersonal Interaction, Builds Relationships

Costly

Sales PromotionProvides Strong Incentives to Buy

Short-Lived

Sales PromotionProvides Strong Incentives to Buy

Short-Lived

Public RelationsBelievable, Effective, EconomicalUnderused by Many Companies

Public RelationsBelievable, Effective, EconomicalUnderused by Many Companies

Direct MarketingNonpublic, Immediate, Customized,

Interactive

Direct MarketingNonpublic, Immediate, Customized,

Interactive

Factors in Developing Promotion Mix Strategies

• Push Strategy - “Pushing” the Product Through Distribution Channels to Final Consumers.

• Pull Strategy - Producer Directs It’s Marketing Activities Toward Final Consumers to Induce Them to Buy the Product.

Type of Product/ Market

Buyer/ Readiness

Stage

Product Life-Cycle

Stage

Changing Face of MarketingCommunications

Marketers Have ShiftedAway From Mass

MarketingLess Broadcasting

Marketers Have ShiftedAway From Mass

MarketingLess Broadcasting

New Marketing Communications RealitiesNew Marketing Communications Realities

Improvements in Information Technology

Has Led to Segmented MarketingMore Narrowcasting

Improvements in Information Technology

Has Led to Segmented MarketingMore Narrowcasting

Integrated Marketing CommunicationsCompany Carefully Integrates and

Coordinates Its Many Communication Channels to Deliver a Clear, Consistent,

Compelling Message.

AdvertisingAdvertising

Personal Selling

Personal Selling

Public Relations

Public Relations

Sales Promotion

Sales Promotion

DirectMarketing

DirectMarketing

PackagingPackaging

EventMarketing

EventMarketing

Message

Managing the integrated Marketing Communication Process As defined by the American Association of Advertising agencies,

integrated marketing communications (IMC) is a concept of marketing communications planning that recognizes the added value of a comprehensive plan. Such a plan evaluates the strategic roles of a variety of communications disciplines – for example, general advertising, direct response, sales promotion and public relations – and combines these disciplines to provide clarity, consistency, and maximum impact through the seamless integration of messages.

Unfortunately many companies still rely on one or two communication tools. This practice persists in spite of the fragmenting of mass markets into a multitude of mini markets, each requiring its own approach; the proliferation of new types of media; and the growing sophistication of consumers. The wide range of communication tools, messages, and audiences make it imperative that companies move toward integrated marketing communications. Companies must adopt a “360-degree view” of consumers to fully understand all the different ways that communications that affect consumer behaviour in their daily lives

Coordinating Media

Media coordination can occur across and within media types. Personal and non-personal communications channels should be combined to achieve maximum impact. Imagine a marketer using a single tool in a “one-shot” effort to reach and sell a prospect. An example of a single-vehicle, single-stage campaign is a one-time mailing offering a cookware item. A single-vehicle, multi-stage campaign would involve successive mailings to the same prospect. Magazine publishers, for example, send about four renewal notices to a household before giving up. A more powerful approach is the multiple-vehicle, multiple-stage campaign. Consider the following sequence

News campaign about a new product Paid ad with a response mechanism Direct mail outbound telemarketing Face-to-face sales call ongoing communication.

Multiple media deployed within a tightly defined time frame can increase message reach and impact. For a Citibank campaign to market home equity loans, instead of using only “mail plus an 800 number”, Citibank used “mail plus coupon plus 800 number plus outbound telemarketing plus print advertising.” Although the second campaign was more expensive, it resulted in a 15 percent increase in the number of new accounts compared with direct mail alone.

Research has also shown that promotions can be more effective when combined with advertising. The awareness and attitudes created by advertising campaigns can improve the success of more direct sales pitches. “Marketing Insight: Coordinating Media to build Brand Equity” describes how to leverage television advertising in other media.

Many companies are coordinating their online and offline communications activities. About a third of advertisers who bought television advertising for the 2002-2003 season bought ad space on the station’s websites. Listing the URL Web addresses in ads (especially print) and on packages allows people to more fully explore a company’s products, find store locations, and get more product or service info.

Dannon makes it a priority to drive traffic to its Dannon Yogurt homepage so that the company can benefit from the twin paybacks of (1) forging direct relationships with customers and (2) building a database of its best customers whose loyalty can be strengthened with more targeted coupon and direct-mail promotional efforts.

Pepsi has been highly successful in linking its online and offline efforts. In 2001, Pepsi and Yahoo! Joined forces for an online promotion that increased sales 5 percent at a cost of about one-fifth of the previous mail-in promotion. During the promotion, Pepsi displayed a portal’s logo on 1.5 billion cans while Yahoo! Created a co-branded PepsiStuff.com e-commerce site where visitors could redeem points from bottle caps for prizes ranging from electronic goods to concert tickets.

When Dutch financial services firm ING Group launched its brand in the United States, TV and print ads were paired with online ads. In one campaign on financial news sites, all the “ings” in the news text turned orange - matching ING’s corporate colours.

Even if consumers do not order online, they can use web sites in ways that drive them into stores to buy. Best Buy’s web site can be seen as a research tool for consumers, as surveys revealed that 40 percent of its customers looked online first before coming into the store.

Implementing IMC

Integrated marketing communications has been slow to take hold for several reasons. Large companies often employ several communications specialists to work with their brand managers who may know comparatively little about the other communication tools. Further complicating matters is that many global companies use a large number of ad agencies located in different divisions, resulting in uncoordinated communications and image diffusion.

Today, however, a few large agencies have substantially improved their integrated offerings. To facilitate one-stop shopping, major ad agencies have acquired promotion agencies, public relation firms, package-design consultancies, web site developers, and direct-mail houses. Many international clients have opted to put a substantial portion of their communications work through one agency. An example is IBM turning all of its advertising over to Ogilvy to attain uniform branding. The result is integrated and more effective marketing communications and a much lower total communication cost.

Integrated marketing communications can produce stronger message consistency and greater sales impact. It forces management to think about every way the consumer comes in contact with the company, how the company communicates its positioning, the relative importance of each vehicle, and timing issues. It gives someone the responsibility – where none existed before – to unify the company’s brand images and messages as they come through thousands of company activities. IMC should improve the company’s ability to reach the right customers with the right messages at the right time and in the right place.

Marketing Memo – How integrated is your IMC program?

In assessing the collective impact of an IMC program, the overriding goal is to create the most effective and efficient communications program possible. The following six criteria can be used to help determine whether communications are truly integrated.

Coverage – Coverage is the proportion of the audience that is reached by each communication option employed, as well as how much overlap exists among communication options. In other words, to what extent do different communication options reach the designated target market and the same or different consumers making up that market?

Contribution – Contribution is the inherent ability of a marketing communication to create the desired response and communication effects from consumers in the absence of exposure to any other communication option. How much does a communication affect consumer processing and build awareness, enhance image, and induce sales?

Commonality – Commonality is the extent to which common associations are reinforced across communication options, that is, the extent to which information conveyed by different communication options share meaning. The consistency and cohesiveness of the brand image is important because it determines how easily existing associations and responses can be recalled and how easily additional associations and responses can become linked to the brand in memory.

Complementarity – Communication options are often more often more effective when used in tandem. Complementarity relates to emphasized across communication options. Different brand associations may be most effectively established by capitalizing on those marketing communication options best suited to eliciting a particular consumer response or establishing a particular type of brand association. As part of the highly successful “drivers wanted” campaign, VW has used television to introduce a story line that it continued and embellished on its Web site.

Versatility – with any integrated communication program, when consumers are exposed to a particular marketing communication, some consumers will have already been exposed to other marketing communications for the brand, whereas other consumers will not have had any prior exposure. Versatility refers to the extent to which a marketing communication option is robust and “works” for different groups of consumers. The ability of a marketing communication to work at “two levels” – effectively communicating to consumers who have or have not seen other communications – is critically important.

Cost – Evaluations of marketing communications on all of these criteria must be weighed against their cost to arrive at the most effective and efficient communications program.