Lecture One MKT 6810 Introduction to Promotions Management and Integrated Marketing Communications (IMC)

Key Terms u Marketing u Set of activities whereby businesses and other organizations create transfers of value (exchanges) between themselves and their customers u Communications u Process whereby thoughts are conveyed and meaning is shared between individuals or between organizations and individuals

Marketing Communications u What types of communications exist to promote their offerings and achieve their financial and non-financial objectives? u B2B u B2C u B2NP

Integrated Marketing Communications a concept of marketing communications planning that recognizes the added value of a comprehensive plan that evaluates the strategic roles of a variety of communication disciplines - for example, general advertising, direct response, sales promotion, and public relations- and combines these disciplines to provide clarity, consistency, and maximum communications impact. Slide 1-1 Irwin/McGraw-Hill © The McGraw-Hill Companies, Inc., 1998

Marketing Communications u Collection of all elements in a brand’s marketing mix that facilitate exchanges by establishing shared meaning with the brand’s customer of clients

Strategies for IMC u Affect Behavior u Use all forms of contacts u Start with customer u Achieve synergy u Build Relationships

Brand Equity u One of the primary objectives of brand and category managers if to utilize promotions to enhance brand equity u Brand equity u New products would be perceived as on a level playing field with existing brands in the marketplace as well as other products of the firm u Most IMC focuses on brand level

Importance of Brand Loyalty vs. Equity u “While marketers have long viewed brands as assets, the real asset is brand loyalty. A brand is not an asset. Brand loyalty is the asset. Without the loyalty of its customers a brand is merely a trademark, an ownable, identifiable symbol with little value. With the loyalty of its customers, a brand is more than a trademark.

Importance of Brand Loyalty u A trademark identifies a product, a service, a corporation. A brand identifies a promise. A strong brand is a trustworthy, relevant, distinctive promise. It is more than a trademark. It is a trustmark of enormous value. Creating and increasing brand loyalty results in a corresponding increase in the value of the trustmark.”

Valuable Brands in the Market u Coca-Cola u Marlboro u IBM u Motorola u HP u GE u Levi’s

Brand Concept Management (BCM) u Brand concept u The specific meaning that managers create and communicate to the TM u Introduce u Utilize advertising and promotions to yield awareness and familiarity u Fortify u Reinforce the image and connections in consumers’ minds u Elaborate u Build and expand to other products

BCM u Focuses on three basic consumer needs u Functional needs u Provide solutions to consumers’ problems through product attributes u Symbolic needs u Psychological desires addressed u Group membership u Affiliation, belongingness (think Maslow) u Experiential Needs u Sensory pleasures addressed as well as cognitive and hedonic consumption

Elements of the Promotions Mix u Advertising u Sales Promotion u Publicity/PR Management u Personal Selling u Direct Marketing

Advertising u Paid u Identifiable Sponsor u Mass Media u Inform or Persuade

Sales Promotion u Incentive or extra value to encourage the consumer to act in a certain fashion. u Trade-oriented and consumer oriented u Examples: coupons, sweepstakes, trade shows, rebates, free samples

Publicity u nonpersonal communication regarding the organization, product, service or idea that is not directly paid for nor run under identified sponsorship, usually coming from a news story, editorial, or announcement about an organization or its products and services

Public Relations u 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.

Personal Selling u involves the direct contact between the buyer and seller in which the seller attempts to persuade and assist the prospective customers to purchase the company’s products or service or to act on an idea.

Direct Marketing u Communication delivered directly to the consumer to generate a response or a transaction u Direct mail u catalogs, specialty promos u Telemarketing u Direct selling u Direct response advertising

Trends in IMC u Reduced Dependence in Mass Media Advertising u Increased Reliance on Highly Targeted Communications Methods u Greater Demands Imposed on Marketing Communications Suppliers u Increased Efforts to Assess Communications ROI