Important to Know Competitors are battling for customers Marketers spending huge for marketing Methods range from simple to complex The number of ways to reach potential customers continually increases. Speak with a clear voice visible measurable Companies need visible and measurable result from marketing expenditure
Communication It can be defined as transmitting, receiving and processing information. When a person, group, or organization attempts to transfer an idea or message, communication occurs when the receiver is able to understand the information.
IMC external internal IMC is a strategic business process used to plan, develop, execute and evaluate coordinated, measurable, persuasive brand communications programs over time with consumers, customers, prospects, employees, associates and other targeted relevant external and internal audiences. The goal is to generate both short- term financial returns, and build long-term brand and shareholder value.
The Components of Promotion Advertising Advertising Sales Promotion Sales Promotion Personal Selling Personal Selling Database Marketing Database Marketing Direct Marketing Direct Marketing Sponsorship Marketing Sponsorship Marketing Internet Marketing Internet Marketing Public Relations Public Relations
Why is IMC gaining importance? Strategically integrating various communication functions, rather than have them operate autonomously. Avoids duplication Avoids duplication Produces synergy among promotional tools Produces synergy among promotional tools More efficient and effective communication programs More efficient and effective communication programs Higher return on investment, according to IMC advocates Higher return on investment, according to IMC advocates In response to changing environment – particularly with respect to consumers, technology and media Changes in consumer demographics, lifestyles, media use, buying and shopping patterns Changes in consumer demographics, lifestyles, media use, buying and shopping patterns
Why is IMC gaining importance? Media fragmentation – they are each reaching a smaller and more selective audience How many TV channels do you have at home? How many TV channels do you have at home? How many newspapers get printed everyday? How many newspapers get printed everyday? Online services gaining prominence - Internet now has in excess of 800 million internet users Hotel and car rentals Hotel and car rentals Airline bookings Airline bookings Consumers ‘tune out’ traditional advertising We are put off by advertising We are put off by advertising We are tired of being bombarded with sales messages We are tired of being bombarded with sales messages Gen Y are skeptical of traditional advertising Gen Y are skeptical of traditional advertising
Promotional Mix Advertising Direct Marketing Interactive/ Internet Marketing Sales Promotion Publicity/ Public Relations Personal Selling
An Integrated Marketing Communications Plan Situation Analysis Marketing Objectives Marketing Budget Marketing Strategies Marketing Tactics Evaluation of Performance
Situation Analysis Internal Analysis Promotional department organization Firm’s ability to implement promotional program Agency evaluation and selection Review of previous program results External Analysis Consumer behavior analysis Market segmentation and target marketing Market positioning refer to Belch & Belch: Figure 1-7
Marketing Objectives Higher Sales? Increase Market Share A new Competitive Position Desired Customer Actions To create awareness or knowledge about a product To create an image
Marketing Budget Ideally, there should be just 2 questions: What will the promotional program cost? How will the money be allocated? In reality, budget is often allocated on the basis of How much is available for spending A percentage of company’s or brand’s sales revenue
Marketing Strategies Positioning Differentiation Branding “In our factories we make products, in the supermarket we sell hope.” - Charles Revson, Founder of Revlon “ I clothe egos ” - Versace, Fashion Designer
Evaluation of Performance Firm accomplish its overall marketing goals and objectives We need to know how well the promotional program is doing, as well as why The findings of this particular IMC program will be used as input for the next program.
Marcom Implement Marcom Strategy Large companies hire advertising agencies to plan and produce their messages and to evaluate and purchase the media that will carry their ads. Agencies work closely with clients as they develop the ads and select media.
Refining the IMC Program First Stage First Stage – Identify, coordinate, and manage all forms of marketing communication. Bring all the communications elements under one umbrella Second Stage – Second Stage – Communications are examined from the perspective of the customer. To be certain external communication match internal communication
Refining the IMC Program Third Stage – Third Stage – Should find ways to apply information technology to IMC programs Final Stage – Final Stage – Organization uses customer data information and insights to drive corporate strategic planning
Factors Affecting the Value of IMC Program Development of Information Technology Changes in Channel Power Increase in competition ( Global Competitors) Maturing Markets Brand Parity (Identical Benefits, Are you ready to switch?) Integration of Information by customers Decline in effectiveness of mass advertising