3What is IMC?The practice of unifying all marketing communication efforts so they send a clear, consistent, persuasive message to target audiences.
4Integrated Marketing Communications A marketing communications planning concept.Recognizes the value of a comprehensive plan.A plan that evaluates the strategic roles of several communications disciplines:General advertisingDirect responseSales promotionPublic relationsCombines the disciplines to provide:ClarityConsistencyMaximum communications impact
5Why is IMC becoming so important? Increased “clutter”.Decreased message credibility.Increased price competition.Fragmented media markets.Shift in channel power.The development of database marketing.Changes in information technology.
7AdvertisingPaid, sponsor-identified, nonpersonal (media) communications.AdvantagesLow cost per contactHigh degree of controlBest differentiation toolBest brand equity builderDisadvantagesVery high overall costDifficult to determine effectivenessCredibility problemsClutter
8Direct Marketing Part of the IMC program Typically has separate: ObjectivesBudgetsStrategiesDirect marketing methodsDirect mailCatalogingTelemarketingDirect response adsInternet sales
9Interactive/Internet Marketing An entirely new era:Little or no history or experienceRapidly changing communications technologyUnprecedented growth and developmentMultiple Internet rolesAs a persuasive advertising mediumAs a means to educate or inform customersAs a sales tool or an actual sales vehicleTo obtain customer database informationTo communicate and interact with buyersTo provide customer service and supportTo build and maintain customer relationships
10Sales Promotion Customer-oriented Trade-oriented Marketing activities that provide extra value or incentives to the sales force, distributors, or ultimate consumers and can stimulate immediate sales.Customer-orientedTargeted to the ultimate users of a product or serviceCouponsSamplingPremiumsRebatesContestsSweepstakesPOP materialsTrade-orientedTargeted toward marketing intermediaries such as retailers, wholesalers, or distributorsBuying allowancesPromotional allowancesPrice dealsSales contestsTrade shows
11Sales Promotion Uses Introduce new products Get existing customers to buy moreAttract new customersCombat competitionMaintain sales in off seasonIncrease retail inventoriesTie in advertising & personal sellingEnhance personal selling efforts
12Sales Promotion Advantages Disadvantages Response is more immediate than advertising.Appeals to price sensitive consumersGenerates extra interest in advertisingEasy to measure effectsHigh controlDisadvantagesShort term impactOften abusedPromotion warsNegligible brand image effect
13Publicity Non-paid, unsponsored, nonpersonal (media) communications. AdvantagesMost credibleLow cost mass communicationDisadvantagesVery little controlRequires media cooperation.Can be negative.
14Public Relations Tools used by Public Relations The management function which evaluates public attitudes, identifies the policies and procedures of an individual or organization with the public interest, and executes a program of action to earn public understanding and acceptance.Tools used by Public RelationsPublicitySpecial publicationsCommunity activity participationFund-raisingSpecial event sponsorshipPublic affairs activities
15Personal Selling Advantages Disadvantages Low overall costs Best for complex infoVery specific targetingDirect feedbackFlexible messageDisadvantagesVery high cost per contactDifficult to communicate a uniform messageMedium level of control
16IMC Players Advertiser or Client Advertising Agency AAAA; AAF; ARFMedia OrganizationsMarketing Communications SpecialistsDirect Marketing AgenciesSales Promotion AgenciesInteractive AgenciesPublic Relations FirmsCollateral ServicesNamelab; Strategic Name Development
17Reasons for Using an Agency Obtain services of highly skilled specialistsArtistsWritersMedia analystsResearchersOthers with specific skillsObtain an objective point of viewFree of internal policy constraints and biasesBroad range of experience, having worked with:Diverse marketing problemsVarious types of clients
18Full-Services Agencies Full Range of Marketing, Communication and Promotion servicesPlanning, creating, producing advertisingPerforming researchSelecting mediaNon-Advertising ServicesStrategic market planningSales promotion and sales trainingProduction of trade show materialsPackage designPublic relations and publicity
19Agency Services Account services Marketing services Creative services The link between agency and clientManaged by the Account ExecutiveMarketing servicesResearch department may design and execute research programsMedia department may analyze, select and contract media resourcesCreative servicesCreation and execution of adsCopywriters, artists, other specialists
20Other Agencies and Services Creative Boutiques Provide only creative servicesOther functions provided by the internal client departmentsFull-service agencies may subcontract with creative boutiques
21Other Agencies and Services Media Buying Services Specialize in buying media, especially broadcast timeAgencies and clients develop media strategyMedia buying organizations implement the strategy and buy time and space
22Direct Response Agencies Data Base ManagementDirect MailResearchMedia ServicesCreativeProduction
23Sales Promotion Specialists ContestsSweepstakesRefunds and rebatesSampling programsIncentive programs
24Public Relations Firms Strategy DevelopmentProgram PlanningGenerating PublicityLobbyingPublic AffairsImage portrayalDamage control
25Interactive Agencies Interactive Media Creation Digitized Content Web sitesWeb banner adsCD-ROMsKiosksDigitized ContentAudioVideoAnimation
26Agency Compensation The Commissions Method Fee Arrangements Agency usually receives 15 percentCommissions are paid by the mediaCommission system is controversialSystem is becoming less commonFee ArrangementsFixed fee methodFee-commission methodCost-Plus AgreementsIncentive-Based CompensationPercentage Charges
27Marketing Strategy The Marketing Concept What is Marketing Strategy? Providing superior customer value.What is value?The marketing Strategy Process:Opportunity Identification / Situation AnalysisS-T-PMarketing mix
28Situation Analysis Internal Factors External Factors Assessment of the firm’s promotional organization and capabilitiesReview of the firm’s previous promotional programsAssessment of firm or brand image and implications for promotionAssessment of relative strengths and weaknesses of product/serviceExternal FactorsCustomer analysisCompetitive analysisEnvironmental analysis
29Segmentation, Targeting, and Positioning Market Segmentation1. Identify segmentation variables and segment themarket2. Develop profiles of resulting segmentsMarket Targeting3. Evaluate the attractiveness of each segment4. Select the target segment(s)Product/Service Positioning5. Identify possible positioning concepts for each targetsegment6. Select, develop, and communicate the chosen positioningconcept
30SegmentationSegmentation is a concept that recognizes the diversity in the marketplace. The process of segmenting the market produces clusters of people who enjoy similar product features.
31SegmentationGoal: Identify segments that seek different benefits and, therefore, will be responsive to different positionings of the product/offerings.Means: Link benefits sought to characteristics that make customers readily identifiable and accessible. For example:User status, Demographics, Media exposure patterns, …Caution: Avoid over-segmenting; make sure that each segment is substantial enough to justify a unique positioning effort.
32Market Segmentation Bases for Segmentation Usage Geographic Non-users vs. Category usersCompetitor users vs. Own brand usersGeographicZip Code AnalysisRegional AnalysisDemographicAgeGenderIncomeOthersBenefit SoughtPsychographic
33Market Segmentation Usage Segmentation Category Usage Nonusers (%) Light Half%pop %useHeavy Half%pop %useHeavy users: Efficiency /ProfitCaution: Majority FallacyBrand Usage$ to Sales - Target people/companies with profile of current user$ to Opportunity - Target users of competitive brands or nonusers
36Market Segmentation Criteria For Segmentation Capturing Segments IdentifiableAccessibleResponsiveSignificantCapturing SegmentsInstruments AvailablePriceProductDistributionPromotionCommon Positioning ErrorsPositioning in a crowded market spacePositioning on an unimportant attribute
37PositioningPositioning requires designing a company and product image and developing a marketing mix to promote the image to the target segment(s).
38Positioning Statement The key concept of an idea to be communicated to a target market via elements of the marketing mix.Elements:TargetConcept (Frame of Reference)Point of Difference
39Potential Communications Objectives Individual salesCustomer loyaltyCompany imageBrand imageStore patronageService contractAn inquiryA visit by the prospectProduct trialPrescription for useRecommendationAdoption of the product
40Communications Objectives Messages are designed to achieve specific strategic goals.The “BellSouth Yellow Pages” campaign’s four objectives:Introduce the new brand name and achieve50% unaided brand awareness80% aided brand awarenessExceed unaided ad recall norm of 14%Improve consumer usage share above 85%Increase revenues by 2.6%
41Major Aspects of the Advertising Program Message developmentCalled “Creative Strategy”Determine basic appealDetermine main messageMedia strategyCommunication channelsType of media . . .Newspapers?Magazines?Radio?Television?Outdoor?Specific media . . .What specific papers, magazines, stations, billboards, or other media?
42Product Decisions A product is a bundle of benefits or values Product symbolism refers to what a product or brand means to customersProduct quality, branding, packaging, and company name contribute to product imageBRANDING:Brand name communicates attributes and meaningAdvertising creates and maintains brand equityPACKAGING:Packaging has become increasingly importantIt is often the customer’s first exposure to product
43Pricing DecisionsPrice must be consistent with perceptions of the productHigher prices communicate higher product qualityLower prices reflect bargain or “value” perceptionsA product positioned as high quality while carrying a lower price than competitors will confuse customersPrice, advertising and distribution be unified in identifying the product position