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An Introduction to Integrated Marketing Communications.

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Presentation on theme: "An Introduction to Integrated Marketing Communications."— Presentation transcript:

1 An Introduction to Integrated Marketing Communications

2 The Marketing & Promotional Mixes Product or Service Pricing Policy Distribution Method Promotional Mix Advertising Advertising Direct Marketing Direct Marketing Sales Promotion Sales Promotion Publicity/Public Relations Publicity/Public Relations Personal Selling Personal Selling Interactive/Internet Mktg Interactive/Internet Mktg IMC Tools

3 What is IMC? The practice of unifying all marketing communication efforts so they send a clear, consistent, persuasive message to target audiences.

4 Integrated 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 advertising General advertising Direct response Direct response Sales promotion Sales promotion Public relations Public relations Combines the disciplines to provide: Clarity Clarity Consistency Consistency Maximum communications impact Maximum communications impact

5 Why 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. Increased clutter. Decreased message credibility. Increased price competition. Fragmented media markets. Shift in channel power. The development of database marketing. Changes in information technology.

6 IMC Example http://thedarkknight.warnerbros.com/ Book

7 AdvertisingAdvertising Advantages Low cost per contact Low cost per contact High degree of control High degree of control Best differentiation tool Best differentiation tool Best brand equity builder Best brand equity builderAdvantages Low cost per contact Low cost per contact High degree of control High degree of control Best differentiation tool Best differentiation tool Best brand equity builder Best brand equity builderDisadvantages Very high overall cost Very high overall cost Difficult to determine effectiveness Difficult to determine effectiveness Credibility problems Credibility problems Clutter ClutterDisadvantages Very high overall cost Very high overall cost Difficult to determine effectiveness Difficult to determine effectiveness Credibility problems Credibility problems Clutter Clutter Paid, sponsor-identified, nonpersonal (media) communications.

8 Direct Marketing Direct marketing methods Direct mail Direct mail Cataloging Cataloging Telemarketing Telemarketing Direct response ads Direct response ads Internet sales Internet sales Part of the IMC program Typically has separate: Objectives Budgets Strategies

9 Interactive/Internet Marketing An entirely new era: Little or no history or experience Little or no history or experience Rapidly changing communications technology Rapidly changing communications technology Unprecedented growth and development Unprecedented growth and development Multiple Internet roles As a persuasive advertising medium As a persuasive advertising medium As a means to educate or inform customers As a means to educate or inform customers As a sales tool or an actual sales vehicle As a sales tool or an actual sales vehicle To obtain customer database information To obtain customer database information To communicate and interact with buyers To communicate and interact with buyers To provide customer service and support To provide customer service and support To build and maintain customer relationships To build and maintain customer relationships

10 Marketing activities that provide extra value or incentives to the sales force, distributors, or ultimate consumers and can stimulate immediate sales. Sales Promotion Trade-oriented Targeted toward marketing intermediaries such as retailers, wholesalers, or distributors Targeted toward marketing intermediaries such as retailers, wholesalers, or distributors Buying allowances Promotional allowances Price deals Sales contests Trade shows Customer-oriented Targeted to the ultimate users of a product or service Coupons Sampling Premiums Rebates Contests Sweepstakes POP materials

11 Sales Promotion Uses Introduce new products Get existing customers to buy more Attract new customers Combat competition Maintain sales in off season Increase retail inventories Tie in advertising & personal selling Enhance personal selling efforts

12 Sales Promotion Advantages Response is more immediate than advertising. Response is more immediate than advertising. Appeals to price sensitive consumers Appeals to price sensitive consumers Generates extra interest in advertising Generates extra interest in advertising Easy to measure effects Easy to measure effects High control High controlAdvantages Response is more immediate than advertising. Response is more immediate than advertising. Appeals to price sensitive consumers Appeals to price sensitive consumers Generates extra interest in advertising Generates extra interest in advertising Easy to measure effects Easy to measure effects High control High controlDisadvantages Short term impact Short term impact Often abused Often abused Promotion wars Promotion wars Negligible brand image effect Negligible brand image effectDisadvantages Short term impact Short term impact Often abused Often abused Promotion wars Promotion wars Negligible brand image effect Negligible brand image effect

13 PublicityPublicity Advantages Most credible Most credible Low cost mass communication Low cost mass communicationAdvantages Most credible Most credible Low cost mass communication Low cost mass communication Disadvantages Very little control Very little control Requires media cooperation. Requires media cooperation. Can be negative. Can be negative.Disadvantages Very little control Very little control Requires media cooperation. Requires media cooperation. Can be negative. Can be negative. Non-paid, unsponsored, nonpersonal (media) communications.

14 Public Relations Tools used by Public Relations Publicity Publicity Special publications Special publications Community activity participation Community activity participation Fund-raising Fund-raising Special event sponsorship Special event sponsorship Public affairs activities Public affairs activities 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.

15 Personal Selling Advantages Low overall costs Low overall costs Best for complex info Best for complex info Very specific targeting Very specific targeting Direct feedback Direct feedback Flexible message Flexible messageAdvantages Low overall costs Low overall costs Best for complex info Best for complex info Very specific targeting Very specific targeting Direct feedback Direct feedback Flexible message Flexible messageDisadvantages Very high cost per contact Very high cost per contact Difficult to communicate a uniform message Difficult to communicate a uniform message Medium level of control Medium level of controlDisadvantages Very high cost per contact Very high cost per contact Difficult to communicate a uniform message Difficult to communicate a uniform message Medium level of control Medium level of control

16 IMC Players Advertiser or Client Advertising Agency AAAA; AAF; ARF AAAA; AAF; ARF AAAAAAFARF AAAAAAFARF Media Organizations Marketing Communications Specialists Direct Marketing Agencies Direct Marketing Agencies Sales Promotion Agencies Sales Promotion Agencies Interactive Agencies Interactive Agencies Public Relations Firms Public Relations Firms Collateral Services Namelab; Strategic Name Development Namelab; Strategic Name Development NamelabStrategic Name Development NamelabStrategic Name Development

17 Reasons for Using an Agency Obtain services of highly skilled specialists Artists Artists Writers Writers Media analysts Media analysts Researchers Researchers Others with specific skills Others with specific skills Obtain an objective point of view Free of internal policy constraints and biases Free of internal policy constraints and biases Broad range of experience, having worked with: Broad range of experience, having worked with: Diverse marketing problems Various types of clients

18 Full-Services Agencies Full Range of Marketing, Communication and Promotion services Planning, creating, producing advertising Planning, creating, producing advertising Performing research Performing research Selecting media Selecting media Non-Advertising Services Strategic market planning Sales promotion and sales training Production of trade show materials Package design Public relations and publicity

19 Agency Services Account services The link between agency and client The link between agency and client Managed by the Account Executive Managed by the Account Executive Marketing services Research department may design and execute research programs Research department may design and execute research programs Media department may analyze, select and contract media resources Media department may analyze, select and contract media resources Creative services Creation and execution of ads Creation and execution of ads Copywriters, artists, other specialists Copywriters, artists, other specialists

20 Other Agencies and Services Creative Boutiques Provide only creative services Other functions provided by the internal client departments Full-service agencies may subcontract with creative boutiques

21 Other Agencies and Services Media Buying Services Specialize in buying media, especially broadcast time Agencies and clients develop media strategy Media buying organizations implement the strategy and buy time and space

22 Direct Response Agencies Data Base Management Direct Mail Research Media Services CreativeProduction

23 Sales Promotion Specialists ContestsSweepstakes Refunds and rebates Sampling programs Incentive programs

24 Public Relations Firms Strategy Development Program Planning Generating Publicity Lobbying Public Affairs Image portrayal Damage control

25 Interactive Agencies Interactive Media Creation Web sites Web sites Web banner ads Web banner ads CD-ROMs CD-ROMs Kiosks Kiosks Digitized Content Audio Audio Video Video Animation Animation

26 Agency Compensation The Commissions Method Agency usually receives 15 percent Agency usually receives 15 percent Commissions are paid by the media Commissions are paid by the media Commission system is controversial Commission system is controversial System is becoming less common System is becoming less common Fee Arrangements Fixed fee method Fixed fee method Fee-commission method Fee-commission method Cost-Plus Agreements Incentive-Based Compensation Percentage Charges

27 Marketing Strategy The Marketing Concept What is Marketing Strategy? Providing superior customer value. Providing superior customer value. What is value? The marketing Strategy Process: The marketing Strategy Process: Opportunity Identification / Situation Analysis S-T-P Marketing mix

28 Situation Analysis Internal Factors Assessment of the firms promotional organization and capabilities Assessment of the firms promotional organization and capabilities Review of the firms previous promotional programs Review of the firms previous promotional programs Assessment of firm or brand image and implications for promotion Assessment of firm or brand image and implications for promotion Assessment of relative strengths and weaknesses of product/service Assessment of relative strengths and weaknesses of product/service External Factors Customer analysis Customer analysis Competitive analysis Competitive analysis Environmental analysis Environmental analysis

29 Segmentation, Targeting, and Positioning Product/Service Positioning Market Segmentation Market Targeting 1. Identify segmentation variables and segment the market 2. Develop profiles of resulting segments 3. Evaluate the attractiveness of each segment 4. Select the target segment(s) 5. Identify possible positioning concepts for each target segment 6. Select, develop, and communicate the chosen positioning concept

30 Segmentation Segmentation 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.

31 Segmentation Goal: 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, … User status, Demographics, Media exposure patterns, … Caution: Avoid over-segmenting; make sure that each segment is substantial enough to justify a unique positioning effort.

32 Market Segmentation Bases for Segmentation Usage Usage Non-users vs. Category users Competitor users vs. Own brand users Geographic Geographic Zip Code Analysis Regional Analysis Demographic DemographicAgeGenderIncomeOthers Benefit Sought Benefit Sought Psychographic Psychographic

33 Market Segmentation Usage Segmentation Category Usage Nonuser s (%) Light Half %pop %use Heavy Half %pop %use Heavy users: Efficiency /Profit Caution: Majority Fallacy Brand Usage $ to Sales - Target people/companies with profile of current user $ to Opportunity - Target users of competitive brands or nonusers

34 Market Segmentation Geographic Segmentation Zip Code Analysis Regional Analysis Demographic Segmentation Age Gender Income Others Volkswagen Ads: 5-second-rule.mov Flirting.mov Synchronicity II.mov Turbonium.mov Smarter Looking.mov http://www.census.gov/cgi-bin/gazetteer

35 Market Segmentation Psychographic Segmentation Lifestyles Values Attitudes Interests Opinions www.claritas.com

36 Market Segmentation Criteria For Segmentation Identifiable Identifiable Accessible Accessible Responsive Responsive Significant Significant Capturing Segments Instruments Available Instruments AvailablePriceProductDistributionPromotion Common Positioning Errors Common Positioning Errors Positioning in a crowded market space Positioning on an unimportant attribute

37 Positioning Positioning requires designing a company and product image and developing a marketing mix to promote the image to the target segment(s).

38 Positioning Statement The key concept of an idea to be communicated to a target market via elements of the marketing mix. Elements: Target Target Concept (Frame of Reference) Concept (Frame of Reference) Point of Difference Point of Difference

39 Potential Communications Objectives Individual sales Customer loyalty Company image Brand image Store patronage Service contract An inquiry A visit by the prospect Product trial Prescription for use Recommendation Adoption of the product

40 Communications Objectives Messages are designed to achieve specific strategic goals. The BellSouth Yellow Pages campaigns four objectives: Introduce the new brand name and achieve Introduce the new brand name and achieve 50% unaided brand awareness 80% aided brand awareness Exceed unaided ad recall norm of 14% Exceed unaided ad recall norm of 14% Improve consumer usage share above 85% Improve consumer usage share above 85% Increase revenues by 2.6% Increase revenues by 2.6% The BellSouth Yellow Pages campaigns four objectives: Introduce the new brand name and achieve Introduce the new brand name and achieve 50% unaided brand awareness 80% aided brand awareness Exceed unaided ad recall norm of 14% Exceed unaided ad recall norm of 14% Improve consumer usage share above 85% Improve consumer usage share above 85% Increase revenues by 2.6% Increase revenues by 2.6%

41 Major Aspects of the Advertising Program Message development Called Creative Strategy Called Creative Strategy Determine basic appeal Determine basic appeal Determine main message Determine main message Media strategy Communication channels Communication channels Type of media... Type of media...Newspapers?Magazines?Radio?Television?Outdoor? Specific media... Specific media... What specific papers, magazines, stations, billboards, or other media?

42 Product Decisions A product is a bundle of benefits or values Product symbolismProduct symbolism refers to what a product or brand means to customers Product symbolism Product quality, branding, packaging, and company name contribute to product image BRANDING: Brand name communicates attributes and meaning Brand name communicates attributes and meaning Advertising creates and maintains brand equity Advertising creates and maintains brand equityPACKAGING: Packaging has become increasingly important Packaging has become increasingly important It is often the customers first exposure to product It is often the customers first exposure to product

43 Pricing Decisions Price must be consistent with perceptions of the product Higher prices communicate higher product quality Lower prices reflect bargain or value perceptions A product positioned as high quality while carrying a lower price than competitors will confuse customers Price, advertising and distribution be unified in identifying the product position

44 Distribution Channel Decisions Channel decisions involve: Selecting Selecting Managing Managing Motivating Motivating Independent intermediaries: Wholesalers Wholesalers Distributors Distributors Brokers Brokers Retailers Retailers


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