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Integrated Marketing Communication Strategy The Marketing Communications Mix Advertising Any Paid Form of Nonpersonal Presentation by an Identified Sponsor. Personal Selling Personal Presentations by a Firm’s Sales Force. Sales Promotion Short-term Incentives to Encourage Sales. Public Relations Direct Marketing Building Good Relations with Various Publics by Obtaining Favorable Unpaid Publicity. Direct Communications With Individuals to Obtain an Immediate Response. The Communication Process Noise Noise Noise Noise Noise Noise Sender Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Encoding Feedback Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Message Noise Noise Noise Noise Noise Noise Media Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Response Noise Noise Noise Noise Decoding Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Receiver Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Noise Steps in Developing Effective Communication Step 1. Identifying the Target Audience Step 2. Determining the Communication Objectives Buyer Readiness Stages Awareness Knowledge Liking Preference Conviction Purchase Steps in Developing Effective Communication Step 3. Designing a Message Message Content Rational Appeals Emotional Appeals Moral Appeals Attention Message Structure Draw Conclusions Argument Type Argument Order Interest Desire Message Format Headline, Copy, Color, Words, & Sounds, Body Language Action Steps in Developing Effective Communication Step 4. Choosing Media Personal Communication Channels Nonpersonal Communication Channels Step 5. Selecting the Message Source Step 6. Collecting Feedback Setting the Total Promotion Budget Affordable Method CompetitiveParity Method Percentageof-Sales Method Objectiveand-Task Method Setting the Promotion Mix Nature of Each Promotion Tool Advertising Reaches Many Buyers, Expressive Impersonal Personal Selling Personal Interaction, Builds Relationships Costly Sales Promotion Provides Strong Incentives to Buy Short-Lived Public Relations Believable, Effective, Economical Underused by Many Companies Direct Marketing Nonpublic, 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. Product Life-Cycle Stage Type of Product/ Market Buyer/ Readiness Stage Changing Face of Marketing Communications New Marketing Communications Realities Marketers Have Shifted Away From Mass Marketing Less Broadcasting Improvements in Information Technology Has Led to Segmented Marketing More Narrowcasting Integrated Marketing Communications Company Carefully Integrates and Coordinates Its Many Communication Channels to Deliver a Clear, Consistent, Compelling Message. Packaging Event Marketing Advertising Message Direct Marketing Personal Selling Sales Promotion Public Relations 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 ecommerce 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, packagedesign 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.