Download JNR INC THE IMPORTANCE OF MARKETING COMMUNICATIONS

 JNR INC THE IMPORTANCE OF MARKETING COMMUNICATIONS In a rapidly changing business world, effective and integrated marketing communications serves a crucial role in building a strong brand and thriving in difficult economic conditions. Table of Contents Abstract………………..…………………………………………………………………………………………………………..Page 3 Introduction to Integrated Marketing Communications ……………….………………………………..Page 4 Importance of Brand Building…………………………………………………………………………………………..Page 6 Recession-­‐Proof Marketing.............................................................................................…...Page 8 Conclusion……………………………………………………………………………………………………….……………..Page 10 Appendices…………………………………………………………………………………………………………………..…Page 11 References………………………………………………………………………………………………………………………Page 13 2 | P a g e Abstract Famed management consultant and author Peter Drucker once described the purpose of marketing as the need to “know and understand the customer so well the product or service fits him and sells itself.” While this philosophy was created decades ago, it remains true and relevant to firms today. The worldwide marketplace for products and services is more competitive than ever before. Technological advances have enabled businesses to improve the efficiency of their supply chain management, delivering products faster and allowing for optimal pricing strategies. Even businesses offering the best quality product can be lost in the clutter of a crowded market. Drucker’s strategy of understanding the target customer is an excellent way to stand out. Specifically, effectively communicating a marketing strategy can ensure a firm’s long-­‐term sustainability and success. This white paper will discuss the concept of integrated marketing communications and how to tailor a message to the audience exposed. Also, the concept of building a brand will be analyzed as it pertains to marketing communications. Finally, the importance of continuing to aggressively market in a recession is evaluated. 3 | P a g e Introduction to Integrated Marketing Communications (IMC) Integrated marketing communications today is a volatile business discipline; a fluid art form and an inexact science that is evolving and expanding every day. Because of this, offering an applicable definition is challenging. Don Schultz, business author and Northwestern University professor emeritus-­‐in-­‐service of IMC, offers the following two definitions: “IMC is a process through which companies accelerate returns by
aligning communications objectives with corporate goals.”
“IMC is a strategic business process used to plan, develop, execute, and evaluate coordinated, measurable,
persuasive brand communications programs over time with consumers, customers, prospects, and other
targeted, relevant external and internal audiences.”
The role of IMC in supporting managerial philosophies and values must be adamantly maintained. With traditional marketing efforts that were limited to print, broadcast and support media, there was significantly greater control over the content audiences were exposed to due to the limited channels and the time and planning involved. Today, digital media present a host of opportunities to innovatively market products and services. However, with these opportunities come dangerous risks, as anyone can effortlessly create content instantly available to billions of users. With online and mobile (smartphone-­‐enabled) adoption rates nearing 80% and 55% in the United States respectively, this method of communication must be utilized as an essential yet carefully-­‐implemented component of a firm’s marketing communications. 4 | P a g e While IMC requires many elements to function effectively, five key components in particular must be addressed to attract positive attention to a firm. 1) Audience Copy cannot be written identically for every project, as some require a professional tone (press release) and others are more casual and fun (blogs, social media). While headlines should be kept short and concise, advertisements allow for creative copy that is largely dependent on the utilized medium. Awareness of the age of the audience must also be taken into consideration. 2) Messaging While sales pieces need to clearly communicate the need to buy a product or service, other messages can exist to simply start a conversation, inform the reader, or create attention. Case Study: Digital IMC Disasters PepsiCo was publicly criticized about an ad for Mountain Dew that was deemed by many critics to be highly racist and misogynistic. In an attempt to appeal to younger audiences, the controversial ad was created by rapper Tyler, the Creator and featured a talking goat with a stereotypical African-­‐
American voice in a police line-­‐up with four black men. A battered white woman on crutches was being asked to identify the perpetrator while the talking goat made threatening comments like “Ya better not snitch on a playa” and “Keep ya mouth shut.” The woman eventually screams “I can’t do this!” and runs off. The word “Do” is displayed, in reference to the “Dew it” slogan of the brand. The ad was almost immediately taken down, although dedicated fans of YouTube periodically re-­‐
posted the videos. While trying to appear cool and plugged in to the culture of its target demographic of young males, this ad campaign, which was to feature several more videos with the talking goat, did nothing more than shine a dark spotlight on PepsiCo. 5 | P a g e 3) Language CEO’s do not need to read emotionally rich content and consumers do not wish to read copy that is jargon-­‐heavy. Tailor the language to fit the reader. 4) Call to Action What should be the end result of the communications? Following the AIDA model of marketing is helpful in answering this question. Marketing collateral should exist to create Awareness, generate Interest, build Desire, or initiate a call to Action. 5) Media Firms should be extremely mindful of the type of media used to communicate their message. Distinguished communications philosopher Marshall McLuhan once stated that “the medium is the message.” This simple idea describes how the message communicated is inherently shaped by the medium displaying it. All four of the previous components may change depending on the media selected. Appendices A & B detail the differences amongst forms of media as it pertains to channel characteristics and process elements. The Importance of Brand Building According to the American Marketing Association, a brand “is a name, term, sign, symbol, or design which is intended to identify the good or services or one seller or group of sellers and to differentiate them from those of competitors.” 6 | P a g e This definition is product-­‐oriented and does not speak to the component of communications that exist within a brand. Also absent from this description are consumer perceptions and attitudes which is oftentimes the only way products are differentiated from other brands or unbranded/private label counterparts. Understanding the consumer’s perception of a brand falls under Drucker’s philosophy of marketing and should be considered a top priority in developing and maintaining a brand. A case study published in the European Journal of Marketing sought to analyze the importance of consistency across brand messages and the subsequent effect on customer-­‐based brand equity. The results found that different brands require different methods of communicating to build brand equity. Established brands require constant nurturing to ensure they are not forgotten in the minds of consumers. The best method of achieving this is by utilizing moderately consistent messages that refresh the interest and attention towards them. Newer, less-­‐established brands, on the other hand require repeated exposure through highly consistent messages aiming to generate awareness as the first step towards building brand equity. Firms must appreciate the importance of building and maintaining their brand through effective communications. Even in a difficult and uncertain economic climate, firms must maintain or increase their marketing communications to stay at the forefront of consumers’ minds. The following section discusses the advantages of this concept. 7 | P a g e Recessionary Marketing
Done the Sears Way
Recession-­‐Proof Marketing In the Fall of 2008, the United States was hit with the worst During the spring of 2009,
the struggling retailer, Sears
met the recession head-on
with two new promotions.
The first was the rebirth of a
layaway program designed to
meet the needs of customers
who had recently lost their
jobs. The second, called
“Kidvantage” is a program
that pledges to replace any
clothing that wears out
before a child outgrows it.
recession since the Great Depression. A collapsing housing market paved the way for the implosion of the country’s largest financial services firms, a drastic drop in the stock market and soaring unemployment. What followed in the coming years was a period of stagflation, where economic growth and incomes remained flat but prices on consumer goods stayed high. This The program promised 15%
off coupons for every $100
spent and covers normal wear
and tear. Craig Israel, Senior
VP of Sears Apparel says the
program “has high concept
appeal. They have peace of
mind knowing they’re getting
great value and are protected.
It’s a win-win.”
reduced demand and eventually caused corporate profits to decline. A common kneejerk reaction by many firms is to offer deep discounts in an attempt to emphasize their value proposition to consumers. The theory here was that customers are shopping The program is financially
viable as well, continues
Israel, “we have done the
financial analysis on it, and it
is a profitable program for
us.”
for less expensive products and services yet still wanted the products they did purchase to provide comfort and relief from economic stress. Other companies simply froze hiring and slashed marketing budgets hoping to wait out the recessionary storm. It is rarely advisable to discontinue marketing communications during a recession. Economic downturns, no matter how severe are always temporary, and consumer spending will increase in 8 | P a g e the future. Staying relevant in a consumer’s mind, even if they are not necessarily able to afford the products they wish to purchase at the time, goes a long way in acquiring that consumer long-­‐term. Some businesses are able to offer deep discounts during economic slumps, and for economy brands this a wise approach. However, premium brands need to adopt different strategies, such as offering long-­‐term financing for loyal customers as Saks Fifth Avenue and Barney’s did during the Christmas season in 2008. Whichever strategy is employed, there must be a concerted effort to target the most loyal customers. Retaining customers is significantly less expensive than acquiring new ones, and by specifically communicating marketing messages towards the most faithful, they will feel reassured and comforted with their purchases and continue to patronize the business. In contrast, a severe price-­‐slashing campaign can erode brand equity, which for luxury brands is immeasurably important for the bottom line. 9 | P a g e Conclusion Marketing communications should be the lifeblood of any business. Done well, it can drive sales, build brand equity and create lifetime customers. Poorly executed, a firm could see its loyal customers and potentially new leads flock to other brands that successfully stand out in a saturated marketplace. Traditional marketing tactics can now be supplemented with new digital opportunities, but businesses must take into consideration corporate goals and objectives for all content created. Finally, a poor economy is no excuse to cut back on marketing communications, as a recession is temporary and shoppers place great value in being targeted as loyal customers. 10 | P a g e Authored by Brandon Learish JNR Incorporated Appendix A Figure 1 A Comparison of Channel Characteristics Synchronicity Anonymity and Privacy Information Processing Audience's Control Self-­‐Delivery Mass Media Impossible Sender: Revealed Receiver: Concealed Self paced for print Externally paced for electronic Impossible Impossible Not forming an objective to Purpose-­‐based Searching search Contextual Availability Abundant Internet Delayed Response High Low Mobile Instantaneous Response Both Possible Possible Both Possible Possible Must form an Form or not form an objective to search objective to search Scattered No Synchronicity: The Degree that the sender sends the message to the receiver and the receiver can respond to the message simultaneously Anonymity/Privacy: The ability for the participants in the media to conceal their identity Information Processing: Self-­‐paced media allow their audience to take time to process information Externally-­‐paced media cannot be controlled by the audience Contextual Availability: The availability of the environment by which the marketing communication messages are surrounded 11 | P a g e Appendix B Figure 2 A Comparison of Significant Communication Process Elements 1. Senders 2. Messages 3. Receivers 4. Responses 12 | P a g e Mass Media Known or Unknown Internet Possible to Know All Formats Able Limited Formats Able to Elaborate to Elaborate Information Information Mass Segmented Cognitive Affective Cognitive Affective Behaviorial Mobile Must be Known All Formats Limited time and space to elaborate information Individual Cognitive Affective Behaviorial References Baidya, Mehir and Maity, Bipasha. “Effectiveness of Integrated Marketing Communications” Journal of Indian Business Research; Vol. 2 No. 1, 2010; pp. 23-­‐31. Carrero, Andrea C. “Strategic Communications: Making Your Marketing and Website Content Work for Your Business.” Bulletin of the American Society for Information Science and Technology; February/March 2011; Volume 37, Number 3. Delgado-­‐Ballester, Elena; Navarro, Angeles; Sicilia, Maria. “Revitalizing brands through communication messages: the role of brand familiarity.” European Journal of Marketing. 46 (2012): 31-­‐51. Grossbery, Kenneth Alan. “Marketing in the Great Recession: An Executive Guide.” Strategy & Leadership; 37.3 (2009); 4-­‐8. http://www.internetworldstats.com/stats.htm Schultz, Don. IMC, The Next Generation: Five Steps for Delivering Value and Measuring Financial Returns. McGrawHill 2004. Smith, Bill. “Recession-­‐Proof Marketing.” Planning; 75. 9 (Oct 2009): 38-­‐40. Van Heerde, Harald J. et. al. “Price and Advertising Effectiveness over the Business Cycle.” Journal of Marketing Research; Vol. L (April 2013), 177-­‐193. 13 | P a g e