© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin INTEGRATED MARKETING COMMUNICATIONS AND DIRECT MARKETING

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin THE COMMUNICATION PROCESS

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin  Communications Communications  Source Source  Message Message  Channel of Communication Channel of Communication  Receivers Receivers THE COMMUNICATION PROCESS

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Encoding and DecodingEncodingDecoding  Field of experience Field of experience Feedback  Response Response Noise THE COMMUNICATION PROCESS

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin THE PROMOTIONAL MIX

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Advertising Personal Selling Public Relations  Publicity Publicity Sales Promotion Direct Marketing THE PROMOTIONAL ELEMENTS

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The Target Audience The Product Life Cycle Introduction Stage Growth Stage Maturity Stage Decline Stage INTEGRATED MARKETING COMMUNICATIONS—DEVELOPING THE PROMOTIONAL MIXPROMOTIONAL MIX

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Promotional tools used over the product life cycle of Purina Dog Chow

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Product Characteristics Stages of the Buying Decision Prepurchase Stage Purchase Stage Postpurchase Stage INTEGRATED MARKETING COMMUNICATIONS—DEVELOPING THE PROMOTIONAL MIX

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The importance of promotional elements varies during the consumer’s purchase decision

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Channel Strategies Push Strategy Pull Strategy INTEGRATED MARKETING COMMUNICATIONS—DEVELOPING THE PROMOTIONAL MIX

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin A comparison of push and pull promotional strategies

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Integrated Marketing Communications INTEGRATED MARKETING COMMUNICATIONS—DEVELOPING THE PROMOTIONAL MIX

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin DEVELOPING THE PROMOTION PROGRAM  Who is the target audience?  What are (1) the promotion objectives, (2) the amounts of money that can be budgeted for the promotion program, and (3) the kinds of promotion to use?  Where should the promotion be run?  When should the promotion be run?

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin DEVELOPING THE PROMOTION PROGRAM

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Identifying the Target Audience Specifying Promotion Objectives  Hierarchy of effects Hierarchy of effects Setting the Promotion Budget DEVELOPING THE PROMOTION PROGRAM

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin U.S. promotion expenditures by companies in 2000

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Setting the Promotion Budget Percentage of Sales Competitive Parity All You Can Afford Objective and Task DEVELOPING THE PROMOTION PROGRAM

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The objective and task approach

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Selecting the Right Promotional Tools Designing the Promotion Scheduling the Promotion DEVELOPING THE PROMOTION PROGRAM

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin EXECUTING AND EVALUATING THE PROMOTION PROGRAM Ideally, pretest and posttest

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The Growth of Direct Marketing DIRECT MARKETING

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Direct marketing expenditures, sales and employment by medium

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The Value of Direct Marketing  Direct orders Direct orders  Lead generation Lead generation  Traffic generation Traffic generation Technological, Global, and Ethical Issues in Direct Marketing DIRECT MARKETING

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin (1) The process of conveying a message to others, which requires six elements: a source, a message, a channel of communication, a receiver, and the processes of encoding and decoding. (2) Online, the dialogue that unfolds between a website and its users. Communication

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin A company or person who has information to convey. Source

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The information sent by a source to a receiver in the communications process. Message

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The means (e.g., a salesperson, advertising media, or public relations tools) of conveying a message to a receiver. Channel of Communication

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Consumers who read, hear, or see the message sent by a source in the communications process. Receivers

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The process of having the sender transform an abstract idea into a set of symbols. Encoding

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The process of having the receiver take a set of symbols, the message, and transform them back to an abstract idea. Decoding

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Similar understanding and knowledge; to communicate effectively, a sender and a receiver must have a mutually shared field of experience. Field of Experience

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin (1) In behavioral learning, the action taken by a consumer to satisfy a drive. (2) In the feedback loop, the impact the message had on the receiver’s knowledge, attitudes, or behaviors. Response

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The communication flow from receiver back to the sender that helps the sender know whether the message was decoded and understood as intended. Feedback

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Extraneous factors that can work against effective communication by distorting a message or the feedback received. Noise

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Any paid form of nonpersonal commu- nication about an organization, good, service, or idea by an identified sponsor. Advertising

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The two-way flow of communication between a buyer and seller, often in a face-to-face encounter, designed to influence a person’s or group’s purchase decision. Personal Selling

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin A form of communication management that seeks to influence the feelings, opinions, or beliefs held by customers, prospective customers, stockholders, suppliers, employees, and other publics about a company and its products or services. Public Relations

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin A nonpersonal, indirectly paid presentation of an organization, good, or service. Publicity

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin A short-term inducement of value offered to arouse interest in buying a good or service. Sales Promotion

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Promotional element that uses direct communication with consumers to generate a response in the form of an order, a request for further information, or a visit to a retail outlet. Direct Marketing

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The combination of one or more of the promotional elements a firm uses to communicate with consumers. The promotional elements include: advertising, personal selling, sales promotion, public relations, and direct marketing. Promotional Mix

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Directing the promotional mix to channel members to gain their cooperation in ordering and stocking a product. Push Strategy

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Directing the promotional mix at ultimate consumers to encourage them to ask the retailer for the product. Pull Strategy

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The concept of designing marketing communications programs that coordinate all promotional activities to provide a consistent message across all audiences. Integrated Marketing Communications

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The sequence of stages a prospective buyer goes through from initial awareness of a product to eventual action (either trial or adoption of the product). The stages include awareness, interest, evaluation, trial, and adoption. Hierarchy of Effects

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Allocating funds to advertising as a percentage of past or anticipated sales, in terms of either dollars or units sold. Percentage of Sales Budgeting

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Matching the competitors’ absolute level of spending or the proportion per point of market share. Competitive Parity Budgeting

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin Allocating funds to promotion only after all other budget items are covered. All-You-Can-Afford Budgeting

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin A budgeting approach whereby the company (1) determines its promotion objectives, (2) outlines the tasks to accomplish these objectives, and (3) determines the promotion cost of performing these tasks. Objective and Task Budgeting

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The result of direct marketing offers that contain all the information necessary for a prospective buyer to make a decision to purchase an complete the transaction. Direct Orders

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The result of a direct marketing offer designed to generate interest in a product or a service, and a request for additional information. Lead Generation

© 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin The outcome of a direct marketing offer designed to motivate people to visit a business. Traffic Generation