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Chapter 12 Catch the Buzz: Promotional Strategy and Integrated Marketing Communication Chapter Objectives Understand the role of marketing communication Understand the communication model List and describe the traditional elements of the promotion mix Explain how WOM, buzz, guerilla and experiential marketing, and consumergenerated media provide alternatives to traditional media forms 12-2 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Chapter Objectives Describe integrated marketing communication (IMC) and its characteristics Explain the important role of database marketing in integrated marketing communication Explain the stages in developing an IMC plan 12-3 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Real People, Real Choices: Decision Time at Tourism Vancouver How can Tourism Vancouver best continue to play a lead role in the 2010 Olympic and Paralympic Winter games? – Option 1: Be the first agency to lead a specific initiative in advance of and during the games – Option 2: Form a tourism steering committee to draft and implement a joint 2010 tourism strategy – Option 3: Take action independent of the consortium’s joint tourism strategy 12-4 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Talk to Your Customers! Promotion: The coordination of marketing communication efforts to influence attitudes or behavior Marketing communications purpose: – Inform – Remind – Persuade – Build relationships 12-5 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Talk to Your Customers! Integrated marketing communication (IMC): Process that marketers use to plan, develop, execute, and evaluate coordinated, measurable, persuasive brand communication programs over time to targeted audiences – Consumers see the variety of messages from a firm as a whole 12-6 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall The Communication Model The communication model explains how organizations create and transmit messages – The source encodes messages which are transmitted through media to receivers, who decode the message and provide feedback Elements of the model: – Source: Firm or person sending a message – Encoding: Transmitting an idea into a form of communication that conveys meaning – Message: Communication in physical form that goes from a sender to a receiver 12-7 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall The Communication Model Elements of the model (cont.): – Medium: Communication vehicle through which a message is transmitted – Receiver: Individual or organization that intercepts and interprets the message – Decoding: Process whereby a receiver assigns meaning to a message – Noise: Anything that interferes with effective communication – Feedback: Receiver’s reactions to the message 12-8 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Marketing Communication Strategy and the Promotion Mix Promotion mix: The major communication elements that the marketer controls – Advertising – Sales promotion – Public relations – Personal selling – Direct marketing 12-9 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Mass Appeals Advertising: Nonpersonal communication from an identified sponsor using mass media – Provides marketers with total control – Rich and dynamic advertising images can help to build or reinforce brand image – May provide factual information or offer reminders to consumers – Lacks credibility with cynical consumers – Extremely expensive 12-10 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Mass Appeals Sales promotion: Contests, coupons, and other incentives designed to build interest or encourage product purchase during a specified period – – – – – – 12-11 Provides retailers with incentives to support a brand Builds retailer and consumer excitement Encourages immediate purchase and trial Reaches price-sensitive consumers Does not focus on building brand loyalty Promotional clutter is hard to break through Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Mass Appeals Public relations: Communication activities that create or maintain a positive image of a firm and its products – Relatively low cost – Highly credible – Poor message control; no guarantee that message will even reach the target – Difficult to track the results 12-12 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Personal Appeals Personal selling: Direct interaction between a company representative and a customer – Flexible; salespeople can modify the message to match customer needs – Immediate feedback is available to sales rep – High cost per contact – Difficult to ensure message consistency between different sales representatives 12-13 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Personal Appeals Direct marketing: Efforts to gain a direct response from individual consumers – Easily target specific customers with different offers – Easily measure results – Can provide extensive information and multiple offers with a single appeal – Facilitates marketing database information collection – Consumers dislike some forms of direct marketing – Higher cost per contact than mass appeals 12-14 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Buzz Appeals Buzz: – Word-of-mouth communication that consumers view as authentic Buzz marketing: – Using high-profile entertainment or news that gets people to talk about the brand Viral marketing: – Creating entertaining or informative messages to be passed along 12-15 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Buzz Appeals Word-of-mouth (WOM) marketing: – Activities that give people a reason to talk about the product Guerrilla marketing: – Activities that “ambush” consumers with promotional content in places they are not expecting to encounter this kind of activity – Example: IBM’s corporate graffiti 12-16 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Buzz Appeals Experiential marketing: – Marketing activities that attempt to give customers an opportunity to actually interact with a brand Consumer-generated media: – The online consumer-generated comments, opinions, and product-related stories available to other consumers through digital media 12-17 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Ethical Issues in Buzz Marketing Ethical problems in buzz marketing can occur when: – Activities are designed to deceive consumers – Directing buzz marketing at children or teens – Buzz marketing activities damage property – Stealth marketing activities deliberately deceive or lie on behalf of clients – Shilling, infiltration, comment SPAM, or SPAM is used 12-18 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Integrated Marketing Communication (IMC) With IMC, marketers plan and execute communication programs that create and maintain long-term relationships with customers by satisfying needs – IMC unifies all marketing communication tools to send a consistent, persuasive message – IMC is becoming increasingly important 12-19 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Characteristics of IMC Marketers must understand that IMC: – Begins with the customer – Creates a single unified voice for firm – Seeks to develop relationships with customers through one-to-one marketing – Relies on two-way communication – Focuses on stakeholders and customers – Generates continuous communication – Focuses on changing behavior 12-20 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall IMC and Database Marketing IMC efforts rely on marketing databases Database marketing: – The creation of an ongoing relationship with a set of customers who have identifiable interest in a product – Customers’ responses become part of the ongoing communication process 12-21 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Developing the IMC Plan Step 1: Identify target audiences Step 2: Establish the communication objectives – Create awareness – Inform the market – Create desire – Encourage purchase and trial – Build loyalty 12-22 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Developing the IMC Plan Step 3: Determine and allocate the marketing communication budget – Determine the total promotion budget – Use one the following: • • • • • 12-23 Top-down budgeting techniques Percentage-of-sales Competitive-parity Bottom-up budgeting techniques Objective-task method Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Developing the IMC Plan Step 3: Determine and allocate the marketing communication budget – Decide on a push or pull strategy • Push strategy: firm moves products through the channel by convincing channel members to offer them • Pull strategy: firm moves products through the channel by building desire among consumers, convincing retailers to respond to demand – Allocate budget to a specific promotion mix 12-24 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Developing the IMC Plan Step 4: Design the promotion mix – Type of appeal • AIDA model: communication goals of attention, interest, desire, and action – Structure of the appeal • One-sided vs. two-sided – Communication channel 12-25 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Developing the IMC Plan Step 5: Evaluate the effectiveness of the communication program – Are communication objectives adequately translated into marketing communication that is reaching the right target market? – Some activities (sales promotions) are easier to evaluate than others (public relations) 12-26 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Real People, Real Choices: Decision Made at Tourism Vancouver Walt chose option 1 – Implementation: Tourism Vancouver is implementing plans to operate kiosks throughout Vancouver that would service visitors to the Olympics – Measuring success: Tourism Vancouver will compare the results of various activities against the objectives set for visitors, sales, sponsorships, etc. 12-27 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall Keeping It Real: Fast-Forward to Next Class Decision Time at BzzAgent Meet Joe Chernov, VP of Communication at BzzAgent BzzAgent operates in the “word-ofmouth” marketing sector The decision to be made: How should BzzAgent respond to the negative publicity surrounding its business activities? 12-28 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permissionCopyright of the publisher. Printed in theEducation, United States of America. © 2009 Pearson Inc. Publishing as Prentice Hall 12-29 Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall