1. The Role of IMC in the Marketing Process Chapter 2

2. Learning objectives To understand marketing process
To understand the concept of target marketing
To recognize the role of market segmentation
To understand the use of positioning
To know various decision area under marketing mix

3. Marketing & Promotions Process Model
Relation to text This slide relates to material on pages of the text and Figure 2-1.
Summary Overview This slide provides an overview of a firm’s marketing process and how promotion fits into the program.
Use of this Slide
Use this slide to discuss how promotion fits into an organization’s marketing strategy and programs. The model consists of four major components:
Marketing strategy and analysis
Target marketing process
Marketing planning program development
Target market
The marketing process begins with the development of a marketing strategy and analysis, during which the company decides the product or service areas and particular markets where it wants to compete. The company must then coordinate the various elements of the marketing mix into a cohesive marketing program that will reach the target market effectively. Note that the promotion program is directed to both the ultimate consumer and the “trade” members or resellers that distribute the company’s products.

4. Marketing Strategy and Analysis
Strategic Marketing Plan
Opportunity Analysis
Competitive Analysis
Target Market Selection
Relation to text This slide relates to pages of the text.
Summary Overview This slide identifies the three steps that are required to develop a strategic marketing plan.
Use of this Slide
Use this slide as you discuss the following:
Opportunity analysis… careful analysis of the marketplace can lead to alternative market opportunities for existing product lines, new products for current markets, or new products for new markets.
Competitive analysis… can range from direct brand competition to more indirect forms of competition, such as product substitutes. The goal is to find a competitive advantage.
Target market selection… after evaluating the opportunities identified during the opportunity and competitive analysis, a company must select one or more target markets. This target market becomes the focus of the firm’s marketing effort, and has direct implications for advertising and promotional efforts.

5. The Target Marketing Process
Identify markets with unfulfilled needs
Determine market segmentation
Select a market to target
Relation to the text This slide relates to pages of the text and Figure 2-2.
Summary Overview The process by which marketers develop different marketing strategies to satisfy different customer needs is called target marketing. The basic steps of this process are shown on this slide.
Use of this slide This slide can be used to introduce the target marketing process and provide a brief description of each step:
Identify markets with unfulfilled needs – this isolates consumers with similar lifestyles, needs, and wants
Determine market segmentation – dividing a market into distinct groups that have common needs and will respond similarly to a marketing action.
Select a market to target – determining how many segments to enter, and which segments offer the most potential.
Position through marketing strategies – the art and science of fitting the product or service to one or more segments of the broad market in such a way as to set it apart from the competition.
Each of these steps is presented in more detail on the following slides.
Position through marketing strategies

6. Target Market Identification
Isolate Consumers With Similar…
Lifestyles
Social class
Economic status
Geographic location
Age
Relation to text This slide relates to page 46 of the text.
Summary Overview This slide presents some of the many ways in which target consumers may be identified.
Use of this Slide
Use this slide to discuss how target market identification isolates consumers with similar needs, lifestyles, and so on. This segmentation allows companies to establish common ground with consumers, which in turn results in more effective marketing and communication programs.
This would be a good time to show the Kraft Foods Philly Cream Cheese video commercial, which targeted an Hispanic audience.
Marital status
Needs

7. Market Segmentation Dividing a market into distinct groups
Relation to text This slide relates to pages of the text .
Summary Overview This slide provides a definition for “market segmentation.”
Use of this Slide
Here are some key points to use during this slide:
The more a market is segmented, the more precise is the marketer’s understanding of it
However, the more segmented the market becomes, the fewer consumers there are in it
When planning a promotional effort, managers must consider whether the target segment is substantial enough to support individualized strategies
Dividing a market into distinct groups
With common needs
Who respond similarly to a marketing situation

8. Bases for Market Segmentation
Demographic
Gender
Age
Race
Life stage
Birth era
Household size
Residence tenure
Marital status
Geographic
Region
City size
Metropolitan area
Density
Socioeconomic
Income
Education
Occupation
Relation to text This slide relates to page 48 of the text and Figure 2-4.
Summary Overview This slide presents some of the bases for market segmentation.
Use of this Slide
Use this slide to illustrate some of the bases for market segmentation, as illustrated in Figure 2-4. It may help clarify the need for demographic segmentation by pointing out that older people may have an occasional use for baby food products, as when taking care of grandchildren, but the heaviest users would be in their prime childbearing years. Likewise, the largest segment of cane users would be seniors.
You may also want to have a discussion about how the same product, say a bar of soap or shampoo, could be marketed differently to men than to women.
Psychographic
Personality
Values/Lifestyle

9. Geographic Segmentation
Relation to text This slide relates to pages 48 of the text and Exhibit 2-7.
Summary Overview This slide presents a typical Big Red advertisement.
Use of this Slide
Use this slide to discuss companies have developed program target to customer is a specific region of the country. In this case, Big Red is a successful regional “cult” brand in Texas.
You may also wish to show the Big Red commercial, Big Red Splash.
International Nasi Lemak targets a specific geographic region

10. Demographic Segmentation Ad
Relation to text This slide relates to page 50 of the text, which discusses demographic segmentation.
Summary Overview This slide shows the cover of AARP VIVA, which targets the 50+ Hispanic segment.
Use of this slide Use this slide to introduce demographic segmentation, in which the market is divided on the basis of age, sex, family size, education, income, or social class.
You may want to ask students which magazines they subscribe too (physical or online), and into which demographic they believe they fall.

11. Benefit Segmentation Ad
Relation to text This slide relates to the text on page 52 of the text and Exhibit 2-10.
Summary Overview This slide shows an example of an ad targeted to consumers looking for a specific benefit.
Use of this slide Use this slide to discuss benefit segmentation. That is, grouping consumers on the basis of attributes sought in a product. In this case, AT&T is offering worldwide cell phone coverage.
Who might be included in this market segment? (Business travelers, people going overseas on vacation, etc.)
What other types of products can students think of that are marketed on the basis of benefits? (Examples: toothpaste, low-energy light bulbs, running shoes, etc.)

12. PRIZM Social Groups $ HIGH
LOW $
Relation to text This slide relates to page 53 of the text and Exhibit 2-11.
Summary Overview This slide shows examples of PRIZM clusters developed by Claritas.
Use of the slide This slide can be used to demonstrate the types of information that research companies offer marketers to help them define their markets and develop targeting strategies.
The chart shown here was developed by Nielsen Claritas. It provides demographic and psychographic profiles of geographic areas as small as census track, block group, or zip code +4. Users of this system include Ace Hardware, Walmart, and AOL, among others.

13. Test Your Knowledge
All of the following are considered market coverage alternatives except:
A) Undifferentiated
B) Differentiated
C) Concentrated
D) Dispersed
Ans: D

14. Selecting a Target Market
Determine how many segments to enter 1
Determine which segments have the greatest potential 2
Relation to text This slide relates to pages 53 and 54 of the text.
Summary Overview This slide presents the two steps that must be performed to select a target market.
Use of this slide Use this slide to introduce the next phase of the marketing process… determining how many market segments to enter, and which of these segments offer the greatest potential.
The following slides get into specifics.

15. Segments Undifferentiated Concentrated Differentiated
Relation to text This slide relates to pages of the text.
Summary Overview This slide provides an overview of the three market coverage options available to marketers.
Use of this Slide
Use this slide to discuss market coverage options:
Undifferentiated marketing… ignores segment differences and offers just one product or service to the entire market.
Differentiated marketing… involves marketing in a number of segments, but developing separate marketing strategies for each.
Concentrated marketing… involves selecting and trying to capture a large share of a single segment.

16. Market Positioning
Relation to text This slide relates to page 54 of the text.
Summary Overview This slide presents the definition of “market positioning” along with a representative ad.
Use of this Slide
Use this slide to discuss the definition of “market positioning.” Lifewater, as shown in this ad, positions itself as a vitamin-rich water. Can students identify other brands of water and their positioning strategy?
Examples include Fiji Water, which is bottled on the island of Fiji, and Perrier, which positions itself as a luxury item.
Point out that waters may also be marketed as spring, mineral, purified, flavored, carbonated, or health-related, and good packaging can command a premium price. (Think average plastic bottle versus the green glass bottle of Perrier.)
Fitting the product or service to one or more segments of the broad market in such a way as to set it apart from competition

17. Positioning Strategies
Attributes and Benefits
Price/Quality
Use/Application
Product Class
Product Users
Relation to text This slide relates to pages of the text.
Summary Overview
This slide presents the seven positioning strategies discussed in the text.
Use of this Slide Use this slide when discussing the various positioning strategies available to marketers:
Attributes/Benefits – a common approach is setting the brand apart from competitors on the basis of specific characteristics or benefits. Marketers attempt to identify salient benefits, which are those that are important to customers when making purchase decisions
Price/Quality – using price as characteristic of the brand. If a product is positioned as high quality, price may be a secondary consideration. Another option is to focus on product quality or value offered at a competitive price.
Use/Application – associate the brand with a specific use. This approach can be an effective way to expand usage of a product.
Product Class – positioning your product against a product in another category, rather than against a competitor. For example, positioning frozen orange juice against fresh oranges.
Product User – associating a brand with a type of person or group that uses a product or service.
Competitor – positioning a company or brand against a competitor. Often another form of positioning is used as well to differentiate the brand.
Cultural Symbols – using a cultural symbol to differentiate a product from competitors (e.g. Keebler elves, the Jolly Green Giant, Tony the Tiger).
Another positioning strategy (not shown on this slide) is repositioning. It involves altering or changing the position of a product or brand, and usually occurs because of stagnant or declining sales.
Competitors
Cultural Symbols

18. Positioning by Cultural Symbol
Relation to text This slide relates to page 57 of the text.
Summary Overview This slide provides an example of a cultural symbol, Tony the Tiger.
Use of this Slide
Use this slide for a discussion on cultural symbols in advertising. How many other symbols can students name, beyond those mentioned in the text?
Examples: The Marlboro Man, Aunt Jemima, Mrs. Butterworth’s, Mickey Mouse, Ronald McDonald, the Trix rabbit, the Michelin Man, Betty Crocker, and the Energizer Bunny.

19. The Marketing Planning Program
Product Decisions
Distribution Channels
Promotional Strategy
Price Decisions
Relation to text This slide relates to pages of the text.
Summary Overview This slide provides an overview of the four types of decisions that will influence and interact with the promotional program.
Use of this Slide
Use this slide to go over the types of decisions that must be made during next phase of the marketing process:
Product decisions… branding and packaging
Price decisions… what can and should be charged
Distribution Channels… direct or indirect
Promotional Strategy… push or pull
Each of these will be discussed in more detail and subsequent slides.

20. Branding Goals Build & maintain brand awareness and interest
Develop & enhance attitudes toward the company, product, or service
Build & foster relationships between the consumer and the brand
Relation to text This slide relates to page 59 of the text.
Summary Overview This slide presents the overall goals of branding.
Use of this Slide
Use this slide to review the overall goals of branding. The subsequent slide presents the difference between brand identity and brand equity.

21. Branding Brand Identity vs. Brand Equity
Relation to text This slide relates to page 59 of the text.
Summary Overview This slide introduces the topic of brand identity versus brand equity. It also contains an advertisement that reflects how Rolex builds strong brand equity.
Use of this Slide
Use this slide to explain the difference between brand identity and brand equity.
Brand identity
Combination of the name, logo, symbols, design, packaging, and image associations held by the consumer
Brand equity
Added value or goodwill
Results from the favorable image, impressions of differentiation, and/or the strength of consumer attachment to a company name, brand name, or trademark

22. Branding and Packaging Decisions
Brand name commun-icates attributes and meaning
Advertising creates and maintains brand equity
Has become increasingly important
Often the customers’ first exposure to product
PACKAGING
Relation to text This slide relates to pages 59 and 60 of the text.
Summary Overview This slide shows two important elements of product decisions - branding and packaging.
Use of this Slide This slide can be used to discuss how branding and packaging are related. They must work together to help create a position and/or image.
Basic functions of packaging… economy, protection, and storage.
Additional functions…
Making a favorable first impression
Distinguishing one product from all the others competing for attention
Communicating information
Satisfying legal requirements regarding composition and content
Carrying sales promotion messages (premiums, contests, sweepstakes)

23. Packaging Creates Image
Relation to text This slide relates to page 60 of the text and Exhibit 2-24.
Summary Overview This slide shows an ad for Saks Fifth Avenue perfume. It is a good example of the importance of packaging in creating a distinct identity and brand image.
Use of this slide This slide can be used to show the importance of packaging in creating brand identity and image. Packaging can be used to communicate, hold the consumer’s attention, and differentiate a brand from competitors.
You may wish to bring in distinctive but unlabeled bottles and other containers to see if students can identify the product from the shape alone. Suggestions include a box from Godiva chocolates, a Coca-Cola bottle, a Pringle’s can, a bottle of Wite-Out, and a Clorox bleach bottle.

24. Pricing Decisions Factors the firm must consider Costs Time Demand
What consumers give up to buy a product or service
Costs
Time
Demand
Mental activity
Relation to text This slide relates to material on page 60 of the text.
Summary Overview This slide presents the variables that must be considered when pricing a product.
Use of this Slide A firm must consider a number of factors in determining the price it charges for its product or service, including costs, demand factors, competition, and perceived value. It must also consider what the ultimate consumer is willing to give up to purchase the product or service
From an IMC perspective, the price must be consistent with the perceptions of the product, as well as the communications strategy.
Competition
Behavioral effort
Perceived value

25. Relating Price to Ads and Promotions
Price must be consistent with perceptions of the product
Higher prices communicate higher product quality
Lower prices reflect bargain or “value” perceptions
Relation to text This slide relates page 60 of the text.
Summary Overview This slide presents key aspects of pricing decisions in an IMC program.
Use of this slide Use this slide to explain that what a firm charges for a product or service must be consistent with its advertising and promotional campaigns. Products and services positioned as “high quality” usually carry a higher price. A low price indicates bargain or value positioning.
It is important to point out that a product positioned as high quality while carrying a lower price than competitors will confuse customers.
Price, advertising, and distribution must be unified in identifying product position

26. Market Channels
Sets of interdependent organizations involved in the process of making a product or service available for use
Relation to text This slide relates to page 61 of the text.
Summary Overview This slide presents the definition of a market channel.
Use of this Slide
Use this slide to introduce the concept of market channels.

27. Channels and Image Channels can impact communication objectives Image
Store displays
Point-of-purchase merchandising
Shelf footage
Relation to text This slide relates to page 61 of the text.
Summary Overview This slide identifies some of the items that must be considered when choosing a distribution channel.
Use of this Slide
Use this slide to discuss the impact that a channel can have on the overall communications objectives.
Is the product better suited to distribution through Neiman Marcus or Kmart?
What types of displays are available and needed in the store?
What type of point-of-purchase merchandising is possible?
How much shelf space is available, and where?
Point out that distributing products via a channel is optional… some companies sell directly to consumers, bypassing the middle-man.

28. Types of Channels Direct Indirect
Driven by direct-response ads, telemarketing, the Internet
Often used when selling expensive and complex products
Indirect
Network of wholesalers and/or retailers
Relation to text This slide relates to page 61 of the text.
Summary Overview This slide presents the differences between direct and indirect channels.
Use of this Slide
Use this slide to discuss the differences between direct and indirect marketing channels. Point out that many companies successfully use direct marketing, including Avon, Tupperware, and Mary Kay.
However, most consumer-product companies distribute through indirect channels… usually a network of wholesalers that sell to retailers, or retailers who sell directly to the consumer.

29. Push vs. Pull Strategies
Relation to text This slide refers to page 61 and 62 of the text.
Summary Overview This slide is an introduction to the concepts of push and pull promotional strategies.
Use of this slide A company can use either a push or pull marketing strategy.
Push strategy… involves motivating the channel members to stock and promote a manufacturer’s products. A push strategy encourages resellers to push merchandise through to their customers.
Pull strategy… involves spending money on advertising and sales promotion efforts directed toward the ultimate consumer. The goal of a pull strategy is to create consumer demand, which encourages retailers to request the product from the retailer.
The choice of a strategy depends on a number of factors, including the company’s relations with the trade, its promotional budget, and demand for the firm’s products. Companies often use both of these strategies, with the emphasis changing as a product moves through its life cycle.

30. Test Your Knowledge
An ad in a publication aimed at veterinarians explains why they should recommend Eukanuba cat food to the owners of the cats they treat. This is an example of:
A) Consumer advertising
B) A promotional pull strategy
C) A harvesting strategy
D) A consumer promotion
E) A promotional push strategy
Ans: E