1. E-Marketing Communication Tools E-M ARKETING /6E C HAPTER 12

2. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-2 C HAPTER 12 O BJECTIVES  After reading Chapter 12, you will be able to:  Define integrated marketing communication (IMC) and explain the importance of the hierarchy of effects model.  Discuss how marketers use the Internet for advertising, marketing public relations, sales promotions, direct marketing, and personal selling.  Identify several emerging IMC tools.  Describe the most effective online IMC tactics.

3. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-3 W ILL IT B LEND ?  Blendtec, a supplier of commercial blenders to Starbucks and others, produced a video in which the CEO blended unusual products such as a garden rake and a golf club.  The video, uploaded to YouTube, received 3.9 million views in an 8-month period.  The Will It Blend? Campaign illustrates the potential value of viral marketing and connecting with consumers online.  Do you think that such campaigns can build awareness? Can you think of other examples?  Ipad – Will it Blend?; Iphone – Will it Blend? Ipad – Will it Blend?Iphone – Will it Blend?

4. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-4 I NTEGRATED M ARKETING C OMMUNICATION (IMC)  IMC is a cross-functional process for planning, executing, and monitoring brand communications.  The goal is to profitably acquire, retain, and grow customers.  IMC strategy requires a thorough understanding of target markets, the brand, its competition, and other internal and external factors.

5. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-5 MARKETING COMMUNICATION TOOLS  MarCom consists of both planned and unplanned messages between firms and customers and among customers.  E-marketers can enhance MarCom by using innovative technologies, such as text and multimedia messages, databases, blogs, digital receiving devices, etc.  Internet MarCom may include advertising, sales promotion, marketing public relations (MPR), direct marketing, and personal selling.

6. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-6  The AIDA and “think, feel, do” (hierarchy of effects) models help guide selection of online and offline MarCom tools to meet their goals.  The models recognize that consumers first become aware of a product before they develop feelings and purchase it.  The models can help marketers select appropriate communication objectives and strategies, such as:  Build brand equity.  Elicit a direct response. IMC GOALS AND STRATEGIES 12-6

7. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-7 E-M ARKETING T ACTICS

8. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-8 I NTERNET A DVERTISING  Advertising is nonpersonal, usually persuasive, communication about products or ideas paid for by an identified sponsor.  All paid space on a website or in an e-mail is considered advertising.

9. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-9 T RENDS IN I NTERNET A DVERTISING  Online advertising reached $23.5 billion in 2008, $22.7 billion in 2009.  In 2009, 14.3% of ad dollars were spent online.  Most spending came from:  Retail  Telecom  Financial services  Automotive  Computing

10. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-10 U.S. INTERNET ADVERTISING EXPENDITURES

11. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-11 I NTERNET A DVERTISING F ORMATS  Keyword search is the fastest growing and most important technique.  Display ads are the second largest.  Display ads include traditional banners and many additional sizes.  Formats include rectangles, pop-ups, banners, buttons, and skyscraper display ads.

12. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-12 A DVERTISING D OLLARS BY F ORMAT

13. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-13 R ICH M EDIA A DS  Rich media ads are interactive, at least offering click-through.  Rich media ads often use Flash animation to attract attention.  Many formats can be rich media, including:  Banner ads.  Interstitial ads.  Floating ads.  Expanding ads.  Polite ads.

14. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-14 C ONTEXTUAL A DS  Ad servers serve ads into web sites as appropriate users view pages.  Facebook also offers specific ad targeting based on user profiles.  This process is also the basis for Google’s AdSense program.  Contextual ads (keyword search) are the largest category of online advertising.

15. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-15 E-M AIL A DVERTISING  E-mail advertising is the least expensive type of online advertising.  Advertisers can purchase space in another firm’s e-mail content, such as newsletters.  Note that email messages sent from a firm directly to Internet users are direct marketing, not advertising.

16. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-16  Sponsorships integrate editorial content and advertising.  Sponsorships allow great interactivity and help firms build synergistic partnerships that provide useful content.  Sponsor disclosure is an important issue for e-marketers. S PONSORSHIPS

17. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-17 M OBILE A DVERTISING  Mobile Internet usage grew about 25% annually from 2007-2010.  Techniques for mobile devices include:  Display ads  Messaging  Location-based ads  Paid search  Video  Advertising on mobile devices is likely to increase.

18. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-18 M OBILE A DVERTISING V ENUES BY G OAL

19. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-19  Public relations includes activities that influence public opinion and create goodwill.  MPR includes brand-related activities and nonpaid, third-party media coverage to positively influence target markets.  A website can serve as an electronic brochure.  Online events can draw traffic to a site.  Users can download video podcasts.  Viral marketing can create buzz online. M ARKETING P UBLIC R ELATIONS (MPR) 12-19

20. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-20  Sales promotions are short-term incentives that facilitate the movement of products to the end user.  Coupons  Rebates  Samples  Contests, sweepstakes, and games  2010 usage estimates are 6%-75% of Internet users.  Sales promotions do not help build customer relationships in the long term. S ALES P ROMOTION O FFERS

21. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-21  Direct marketing is direct communication designed to generate a response.  Online techniques include:  Outgoing e-mail.  Targeted online ads that solicit a direct response.  Text messages or Short Message Services (SMS).  Multimedia and instant messages. D IRECT M ARKETING

22. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-22  E-mail, used by 89% of Internet users, is the Internet’s killer application.  75% of marketers invest in e-mail campaigns.  E-mail has advantages over postal direct mail marketing.  No postage or printing costs.  Immediacy and convenience.  E-mails can be automatically individualized.  E-mail also has disadvantages.  Unsolicited e-mail (spam).  Effective lists are hard to obtain and maintain. E-M AIL

23. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-23 M ETRICS FOR E LECTRONIC AND P OSTAL M AIL

24. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-24  When consumers opt-in, they are giving permission to receive commercial e-mail.  Marketers should obtain lists that are guaranteed to be 100% opt-in.  Opt-in techniques are part of a bigger marketing strategy called permission marketing or “turning strangers into customers.” P ERMISSION M ARKETING : O PT - IN, O PT - OUT

25. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-25 V IRAL M ARKETING  Viral marketing is the online equivalent of “word of mouth” marketing.  Hotmail is a viral marketing success story.  Movies such as Blair Witch Project and American Psycho were promoted using viral marketing techniques.  Burger King’s Subservient Chicken campaign drew 14 million visitors in the first year.

26. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-26  Short Message Services (SMS) are up to 160 characters of text sent over the Internet with a cell phone or smartphone.  Marketers can build relationships by sending permission-based information where consumers want to receive it.  SMS use continues to grow in all industrialized nations. T EXT M ESSAGING

27. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-27 L OCATION - BASED M ARKETING  Location-based marketing includes promotional offers pushed to mobile devices and based on the user’s physical location.  Google is on the leading edge with its local search.

28. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-28 DIRECT MARKETING METRICS  Response rate and ROI are the most appropriate metrics for direct marketing campaigns.  E-mail receives a widely varied and generally low click through rate, but the highest ROI of any direct media.  In a study of SMS campaigns, 94% of messages were read by recipients and 23% showed or forwarded messages to a friend.

29. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-29 S PAM  Spam is unsolicited e-mail.  The CAN-SPAM Act appears to have little ability to stop spam.  Spammers routinely harvest e-mail addresses from newsgroup postings and then spam the members.

30. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-30 P ERSONAL S ELLING  Personal selling involves real time conversation between a salesperson and customer, face-to- face, by telephone, or by computer.  Some companies provide real time sales assistance online.  Land’s End has a live chat feature.  The Internet can also generate leads for salespeople.

31. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-31 IMC M ETRICS  Display ads are generally ineffective. Only 0.2% of all users click on them.  Online ads that were bigger or contained rich media delivered greater impact.  There is increasing evidence that online and offline advertising work well together.

32. ©2012 PEARSON EDUCATION, INC. PUBLISHING AS PRENTICE HALL 12-32 B EST AND W ORST P ERFORMING IMC T ACTICS

33. 12-33 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 permission of the publisher. Printed in the United States of America. Copyright © 2012 Pearson Education, Inc. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall