1. CHAPTER FIFTEEN INTEGRATED MARKETING COMMUNICATIONS

2. Chapter Overview
Promotion: function of informing, persuading, and influencing the consumer’s purchase decision
Marketing Communications: transmission from a sender to a receiver of a message dealing with the buyer-seller

3. Integrated Marketing Communications
Integrated marketing communications (IMC): Coordination of all promotional activities – media advertising, direct mail, personal selling, sales promotion, and public relations – to produce a unified customer-focused promotional message
Success of any IMC program depends critically on identifying the members of an audience and understanding what they want

4. THE COMMUNICATIONS PROCESS
Table 15.1: Relating Promotion to the Communications Process

5. THE COMMUNICATIONS PROCESS
An effective promotional message accomplishes three tasks:
It gains the receiver’s attention
It achieves understanding by both receiver and sender
It stimulates the receiver’s needs and suggests an appropriate method of satisfying them
The above tasks are related to the AIDA concept (Attention-Interest-Desire-Action) – an explanation of the steps through which an individual reaches a purchase decision

6. Global Difficulties With the Communication Process
In China: KFC’s slogan: “Finger lickin’ good” came out as “Eat your fingers off”
Also in China: Coca-Cola had thousands of signs made using the translation: “Ke-kou-ke-la”
Depending on the dialect this means . . .
“Bite the wax tadpole,” or
“Female horse stuffed with wax”
In Taiwan: Pepsi’s slogan, “Come alive with the Pepsi generation” came out as “Pepsi will bring your ancestors back from the dead”

7. Objectives of Promotion
Provide Information
Objectives of Promotion
Traditional function of promotion was to inform the market about the availability of a particular good or service
Marketers still direct large portions of current promotional efforts at providing information

8. Objectives of Promotion
Increase Demand
Increase Demand
Objectives of Promotion
Some promotions are aimed at increasing primary demand, the desire for a general product category
More promotions are aimed at increasing selective demand, the desire for a specific brand

9. Objectives of Promotion
Differentiate the Product
Product differentiation is a frequent objective
Homogenous demand for many products results when consumers regard the firm’s output as virtually identical to its competitors’– then, the firm has virtually no control over marketing variables
Product differentiation permits more flexibility in marketing strategy

10. Objectives of Promotion
Accentuate Product’s Value
Promotion can explain the greater ownership utility of a product to buyers, thereby accentuating its value and justifying a higher price

11. Objectives of Promotion
For the typical firm, sales fluctuations may result from cyclical, seasonal, or irregular demand
Stabilizing these variations is often an objective of promotional strategy
Stabilize Sales

12. The Promotional Mix
Promotional mix: blend of personal selling and nonpersonal selling (including advertising, sales promotion, direct marketing, and public relations) designed to achieve promotional objectives
Personal Selling
Nonpersonal Selling

13. Nonpersonal Selling
Advertising
Advertising: paid, nonpersonal communication through various media by a business firm, not-for-profit organization, or individual identified in the message with the hope of informing or persuading members of a particular audience

14. Nonpersonal Selling Sales promotion
Sales promotion: marketing activities other than personal selling, advertising, and publicity that stimulates consumer purchasing and dealer effectiveness (includes displays, trade shows, coupons, premiums, contests, product demonstrations, and various nonrecurrent selling efforts)
Trade promotion: sales promotions aimed at marketing intermediaries rather than ultimate consumers

15. Nonpersonal Selling
Direct marketing
Direct marketing: direct communications other than personal sales contact between buyer and seller, designed to generate sales, information requests, or store visits

16. Nonpersonal Selling
Public relations
Public relations: firm’s communications and relationships with its various publics
Publicity: stimulation of demand for good, service, place, idea, person, or organization by unpaid placement of commercially significant news or favorable media presentations

17. Table 15.2: Relating Promotion to the Communications Process
Personal Selling
Advertising
Sales Promotion
Direct Marketing
Public Relations
Permits measurement of effectiveness.
Elicits an immediate response.
Tailors the message to fit the customer.
Reaches a large group of potential consumers for a relatively low price per exposure.
Allows strict control over the final message.
Can be adapted to either mass audiences or specific audience segments.
Produces an immediate consumer response.
Attracts attention and creates product awareness.
Allows easy measurement of results.
Provides short-term sales increases.
Generates an immediate response.
Covers a wide audience with targeted advertising.
Allows complete, customized, personal message.
Produces measurable results. 
Creates a positive attitude toward a product or company.
Enhances credibility of a product or company.

18. Table 15.2: Relating Promotion to the Communications Process (Continued)
Personal Selling
Advertising
Sales Promotion
Direct Marketing
Public Relations
Relies almost exclusively upon the ability of the salesperson.
Involves high cost per contact.
Does not permit totally accurate measurement of results.
Usually cannot close sales.
Is nonpersonal in nature.
Is difficult to differentiate from competitor’s efforts.
Suffers from image problem.
Involves a high cost per reader.
Depends on quality and accuracy of mailing lists.
May annoy consumers.
May not permit accurate measurement of effect on sales.
Involves much effort directed toward nonmarketing-oriented goals.

19. DEVELOPING AN OPTIMAL PROMOTIONAL MIX
Factors that influence the effectiveness of a promotional to mix:
Nature of the market
Nature of the product
Stage in the product life-cycle
Price
Funds available for promotion
Nature of Market
Nature of Product
Stage in PLC
Price
Funds Available

20. Table 15.3: Factors Influencing Choice of Promotional Mix
Personal Selling
Advertising
Nature of the market Number of buyers Geographic concentration Type of customer
Limited number
Concentrated
Business purchaser
Large number
Dispersed
Ultimate consumer
Nature of the product Complexity Service requirements Type of good or service Use of trade-ins
Custom-made, complex
Considerable
Business
Trade-ins common
Standardized
Minimal
Consumer
Trade-ins uncommon
Stage in the product life cycle
Often emphasized at every stage; heavy emphasis in the introductory and early growth stages in acquainting marketing intermediaries and potential consumers with the new good or service
Often emphasized at every stage; heavy emphasis in the latter part of the growth stage, as well as the maturity and early decline stages, to persuade consumers to select specific brands
Price
High unit value
Low unit value

21. PULLING AND PUSHING PROMOTIONAL STRATEGIES
Pulling strategy: promotional effort by a seller to stimulate demand among final users, who will then exert pressure on the distribution channel to carry the good or service, pulling it though the marketing channel
Pushing strategy: promotional effort by a seller to members of the marketing channel intended to stimulate personal selling of the good or service, thereby pushing it through the marketing channel

22. Table 15.4: Promotional Budget Determination
Method
Description
Example
Percentage-of-sales method
Promotional budget is set as a specified percentage of either past or forecasted sales.
“Last year we spent $10,500 on promotion and had sales of $420,000. Next year we expect sales to grow to $480,000, and we are allocating $12,000 for promotion.”
Fixed-sum-per-unit method
Promotional budget is set as a predetermined dollar amount for each unit sold or produced.
“Our forecast calls for sales of 14,000 units, and we allocate promotion at the rate of $65 per unit.”
Meeting competition method
Promotional budget is set to match competitor’s promotional outlays on either an absolute or relative basis.
“Promotional outlays average 4 percent of sales in our industry.”
Task-objective method
Once marketers determine their specific, promotional objectives, the amount (and type) of promotional spending needed to achieve them is determined.
“By the end of next year, we want 75 percent of the area high-school students to be aware of our new, highly automated fast-food prototype outlet. How many promotional dollars will it take, and how should they be spent?”

23. MEASURING THE EFFECTIVENESS OF PROMOTION
Two basic measurement tools:
Direct sales results measures the effectiveness of promotion by revealing the specific impact on sales revenues for each dollar of promotional spending
Indirect evaluation concentrates on quantifiable indicators of effectiveness like:
Recall - how much members of the target market remember about specific products or advertisements
Readership – size and composition of a message’s audience