1. Integrated Marketing Communications (KOM 5325) Hamisah Zaharah Hasan, PhD

2. The course covers the functions of Integrated Marketing Communications discussing topics such as advertising, direct marketing, the Internet, interactive media, sales promotion, public relations, corporate advertising and direct selling; market environment which includes segmenting, targeting, positioning and consumer purchasing behavior; evaluation of a company’s marketing and promotional situation; Integrated Marketing Communications strategies and programs.

3. Course Objectives: analyze the differences between the major marketing
communication functions (C4); evaluate a company’s marketing and promotional
situation (P4); develop effective Integrated Marketing
Communications strategies and programs (A4) and contribute to the planning and coordinating of group
work (CS, LL)

4. Course Evaluation
Assignment 1 : 10 points Midterm exam : 20 points Group project : 30 points Final exam : 40 points

7. Welcome to IMC

10. THE EVOLUTION OF IMC
1980s companies see the need for more strategic integration of their promotional tools
Process IMC involves coordinating the various elements & other marketing activities that communicate with a firm’s customers. e.g. use ads, sales promotion, corp. sponsorship, direct marketing, etc
Companies built profitable relationship with customers, stakeholders, stockholders.

11. IMC the beginning ....
Advertisers were not clear of advertising in the new millennium …..
The industry realized its vulnerability to the outside world
OUTSIDE THE BOX?

12. BEFORE IMC .....
For many years, the promotional function in most companies was dominated by mass media ads. Companies relied primarily on their ads agencies for guidance in nearly all areas of marcom. In fact, most marketers did use additional promotional & marketing tools but, sales promotion & direct marketing agencies as well as package design firms were generally viewed as auxiliary services & often used on a per-project basis. PR agencies were used to manage the organization’s publicity, image & affairs with relevant publics on an ongoing basis but were not viewed as integral participants in the marcom process.

13. DEPARTMNTALIZATION?
They failed to recognize that the wide range of marketing & promotional tools must be coordinated to communicate effectively and present a consistent image to target audience
Many marketers manage its various marketing & promotional functions separately. Different budgets, views of market, goals & objectives.

14. what is IMC ?
…. 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 e.g. general ads., direct response, sales promotion, and public relations …. and combines these disciplines to provide clarity, consistency and maximum communications impact ….. Belch & Belch,1999

15. IMC .... according to Wells et al.
The concept or philosophy of marketing that stresses bringing together all the variables of the marketing mix, all the media, all the actions with which a company reaches its publics, and integrating the company’s strategy & programs …..

16. IMC follows the concept of marketing that start with the consumer needs and wants and work back to the brand. Through the information from the database companies are able to find out about consumers.
IMC is a practice of unifying communication tools from packaging ---- to sending consistent, persuasive message to target audience
Schultz

17. ONCE THEY EMBRACED IMC...
….. The began asking their ad agencies to coordinate the use of a variety of promotional tools rather than relying primarily on media advertising. …. Some companies began looking beyond the traditional advertising agencies & use other types of promotional specialists to develop & implement various components of their promotional plans.

18. THE FOCUS OF IMC .... ….. Using all forms of promotion
…..Approach to planning marketing
….Promotion programs
….Coordinating communication functions
IMC helps companies identify the most appropriate & effective methods to conduct customers & stakeholders.

19. WHY THE GROWING IMPORTANCE OF IMC ???
Significant marketing development
Added value of integrating various communication functions
Maximize return on investment

20. Media
OLD MEDIA
NEW MEDIA ...

21. INTERNET, VCD, DVD, MOBILE PHONE RADIO/TV/MAGAZINES/NEWSPAPER
NEW TECHNOLOGY
OLD MEDIA VS
INTERNET, VCD, DVD, MOBILE PHONE
RADIO/TV/MAGAZINES/NEWSPAPER

22. AVOID DUPLICATION ---- integrate marcom activities
NEW TECHNOLOGY NEW ENVIRONMENT --- new ways to reach consumers
DIFFERENT CONSUMERS sophisticated, demanding,
EXPENSIVE TRADITIONAL MEDIA
REASONS FOR IMC

23. Why IMC?
Use major communication functions in concert (synergy) to provide clarity, consistency, and maximum communications impact
Synergy yields results greater than if each functional area had selected its own targets, chosen its own message strategy, and set its own media schedule and timing

24. INTRODUCTION to PROMOTION and INTEGRATED MARKETING COMMUNICATIONS

25. Relationship Between Promotion, the Promotional Mix, and Integrated Marketing Communications
Communication Process in Marketing
Used to Create a Favorable Predisposition Toward:
Brand of Product
Service
Idea
Person
PROMOTIONAL MIX
Blend of Communications Tools and Activities Used by a Firm
Carries out the Promotion Process
Communicates Directly with Target Markets
1.2

26. INTEGRATED MARKETING COMMUNICATIONS (IMC)
Manages the Processes and Activities of Using Promotional Tools
Unified Way
Produces a Synergistic Communications Effect
1.3

27. Management of the Promotion Mix
IMC:
Process
Tools
Management of the Promotion Mix
1.4

28. The Promotional Mix ADVERTISING Paid Mass Media Attempt to Persuade
Complex System of Strategic Planning and
Creative Genius
INTERNET ADVERTISING
Electronic Mail ( )
Internet Relay Chat (IRC)
Usenet
World Wide Web (www)
SALES PROMOTION
Use of Incentives to Generate a Specific Short-Term Response
Household Consumer
Trade Buyer
Business Buyer
1.5

29. ADVERTISING

30. Example of Sales Promotion

31. Example of Mass Media Advertising
1.6

32. Example of Sales Promotion
1.7

34. The Promotional Mix DIRECT MARKETING AND e-COMMERCE
Distinguished From Other Primary Promotional Tools in 3 Ways
Uses a Combination of Media
Designed to Elicit a Direct Response
Transactions Can Occur Anywhere
E-Commerce is Another Form of Direct Marketing
Business is Conducted Between Buyers and Sellers Using Electronic Exchange Media
1.8

35. Creating an Event to Showcase a Firm’s Brand POINT-OF-PURCHASE
shelf-talkers, signage, easel stands, bottle-neckers, price cards, hang-tags, pop-ups
SPONSORSHIP
Funding an Event
Creating an Event to Showcase a Firm’s Brand
POINT-OF-PURCHASE
Materials Used in Retail Setting to Attract Shoppers’ to a Company’s Brand
SUPPORTIVE COMMUNICATIONS
Used to Target Audiences Outside Mainstream Media or Electronic Communications
1.9

36. SUPPORTIVE COMMUNICATIONS
Used to Target Audiences Outside Mainstream Media or Electronic Communications

37. PUBLIC RELATIONS
Communication that can Foster Goodwill Between a Firm and its Many Constituent Groups
PERSONAL SELLING
Presentation of Information about a Firm’s Products or Services by One Person to Another Person or to a Small Group of People
1.10

38. Personal Selling is the Most Important Variable in the
Promotional Mix of Many
Organizations
1.11

39. ROLE OF PROMOTION IN MARKETING STRATEGY
Must Have Marketing Strategy Decisions about Products (Brand)
Branding – Established Name, Term, Symbol or Design that Identifies for Consumers that a Product is being Offered by a Particular Seller and Clearly Distinguished the Product of that Seller from those Offered by Competitors
1.12

40. 1.12

41. ROLE OF PROMOTION IN MARKETING STRATEGY
Role of Promotion in Marketing Strategy Affects 3 Key Aspects of Decision Making with Respect to Brands
Creating the Marketing Mix
Achieving Effective Market Segmentation, Product Differentiation, and Positioning
Enhancing Revenues and Profits
1.13

42. Assumes a Wide Range of Responsibilities Related to: Conception
ROLE OF PROMOTION IN THE MARKETING MIX
Assumes a Wide Range of Responsibilities Related to:
Conception
Pricing
Distribution Brands
Product (Brand)
1.14

43. ROLE OF PROMOTION IN THE MARKETING MIX
Promotion Affects the Product Area of the
Marketing Mix
Information and Persuasion
Introduction of New Brand or Brand Extensions
Building and Maintaining Brand Loyalty
Among Consumers
Within the Trade
1.15

44. One Role for Promotion is to Help Introduce Brand Extensions
Like this Extension of Jell-O into
the Yogurt Market
1.16

45. ROLE OF PROMOTION IN THE MARKETING MIX Price
Effects the Consumer Market
Effects the Trade Market
Distribution
Consumer Access to Brands
Securing Trade Distribution
1.17

46. Promotion is Important in Helping to Execute These Strategies
Market Segmentation
Product Differentiation
Positioning
External
Internal
1.18

47. The Role of Promotion in Revenue and Profits
Sales Occur
Brand has Well-Conceived Marketing Mix
Complete Marketing Mix
Good Promotion
Large-Scale Demand /Production Produces
Cost to Produce Item is Reduced
Known as Economies of Scale
Brand Loyalty at Any Cost
Firm Raises Prices
Known as Inelasticity of Demand
1.19

48. Promotional Tools Help Increase Brand Loyalty
1.20

49. Integrated Marketing Communications
FACTORS CONTRIBUTING TO IMC’s RISING PROMINENCE
Fragmentation of Media
Better Audience Assessment Through Database Technology
Consumer Empowerment
Increased Advertising Clutter
Shifting Channel Power
Desire of Greater Accountability
1.21

50. Clutter of Advertising
Promotion and IMC
Help Cut Through the
Clutter of Advertising
1.22

51. Participants in IMC Management
Marketing Organization
Marketing Plan
Goal & Objectives
Customer/Prospect Databases
IMC Management
Personal Selling
Advertising Agency
Research
Creative Strategies
Production
Message Placement
Public Relations
Advertising
Sales Promotions
P-O-P
Supportive
Specialized Promotion Organizations
Media Organizations
Event Management Firms
Web Site Designers
Sales Promotions Agencies
Direct Marketing Agencies
Public Relations Firms
P-O-P Agencies & Designers
Internet Advertising
Sales Promotions
Direct Marketing
e-Commerce
1.23

52. 1.22

53. THE PROMOTION INDUSTRY: MARKETERS, AGENCIES, and MEDIA ORGANIZATIONS

54. The Promotion Industry in Transition
ALTERED BY SIX TRENDS
Information in Marketplace is an Interactive System
between Marketers and Consumers
Proliferation of Cable TV, Direct-Marketing & Alternative New Media Causes Media Fragmentation
Growing Investment in Advertising Causes Media Clutter

55. Growing Investment in Advertising Causes Media Clutter

56. The Promotion Industry in Transition
ALTERED BY SIX TRENDS
New Communications/Distributions Channels are Growing in Influence
Fragmentation of Marketing Budgets Resulting in Greater Portions of Budgets going to Trade & Consumer Promotions
Improved Information Systems Allow Retailers & Distributors more Control over Marketing & Promotional Decisions

57. Structure of the Promotion Industry and Participants in the Process
Marketers
Manufacturers Resellers, retailers, Government and
and service firms wholesalers, and social organizations distributors
Advertising and
Promotion Agencies
Advertising agencies: Agency services: Agency compensation:
Full-service agencies Account services Commission
Creative boutiques Marketing research Markup charges
Media-buying services Creative and production Fee system
Interactive agencies services Pay-for-results
In-house agencies Media planning research
Promotion agencies:
Direct marketing and
database agencies
E-Commerce agencies
Event planning
Design firms
Public relations firms
Sales staffing and training
firms

58. External Facilitators
Marketing and Production facilitators
advertising research Consultants
firms Information
intermediators
Media Organizations
And Trade Partners
Media Organizations: Interactive media Trade Partners:
Broadcast media Support media Wholesalers, distributors,
Print media Media conglomerates retailers
B-to-B trade
communities Internet portals
Target Audience(s)
Household consumers Business and professional Government and social
Trade resellers buyer organizations

59. Structure of Promotion Industry
Producer of Consumer products and services, etc…
MARKETERS
Manufacturing and Service Firms
Trade Resellers
Federal, State and Local Governments
Social Organizations
March of Dimes
Nature Conservancy
MAKNA
Organizations that that buy products to sell to consumers

63. 2.5

64. 2.5

65. Marketer that Relies on Advertising
The U.S. Government is a
Marketer that Relies on
Advertising
2.5

66. Structure of Promotion Industry (con’t)
Grey Global Group, Omnicom Group
AGENCIES
Advertising Agencies
Full Service Agency
Creative Boutique
Interactive Agency
In-House Agency
Media-Buying Agency
Idea factories
Visit
Gap, Calvin Klein, Revlon do their own in-house work

67. A German advertising agency with the colorful name "indigo:"

68. AGENCIES
Promotional Agencies
Direct Marketing and Database Agencies
Fulfillment Centers
E-Commerce Agencies
Sales Promotion Agencies
Consumer Sales Promotion
Trade Sales Promotion
Event-Planning Agencies
Design Firms
Logo Design
Public Relations Firms
Sales, Staffing, Training & Assessment Firms

69. Marketers Develop Logo Designs that Last, Like this Pillsbury Logo
Design Firms Help
Marketers Develop Logo
Designs that Last,
Like this Pillsbury Logo
2.9

71. AGENCIES
Agency Services
Account Services
Marketing Research
Creative & Production
Creative Services
Production Services
Media-Planning and Buying
Administrative

72. AGENCIES (con’t) Agency Compensation Commissions Markup Charges
Fee System
Pay-for-Results
2.72

73. Approaches to Determining the Advertising Appropriation
All you can afford
Pick all that is left after all other relevant allocations have been made.
this approach is used by Small fishes (small companies with small budget) or may be by some other firms that are big when they are introducing the new product.
This approach is merely an availability oriented budget and unsophisticated.
In the competition-matching approach, marketers try to match their major competitors’ appropriations in terms of absolute dollars or to allocate the same percentage of sales for advertising that competitors allocate. 20 20 20 20 18 20 20

74. Approaches to Determining the Advertising Appropriation
Competitive Parity (Matching)
Match or base their sales promotion budget to that of the major competitors.
The logic attributed to this method is that the collective minds of the companies in the industry probably generate promotion budget that are close to optimal and any departure from the industry norms may lead to promotion war.
In the competition-matching approach, marketers try to match their major competitors’ appropriations in terms of absolute dollars or to allocate the same percentage of sales for advertising that competitors allocate. 20 20 20 20 18 20 20

75. Approaches to Determining the Advertising Appropriation
Percent-of-Sales %
Used to determine the promotional budget of the company. So they more or less pull certain percentage of the sales made in a fixed period. E.g. last year or for several past years. This decision is more dependent on the current business scenario and current working of the company.
It might be that the company may consider just last years sales figures under consideration as they may have made great sales.
You may take one year or an average of several this depends on many condition in which the org functions.
I In the percentage of sales approach, marketers multiply a firm’s past sales, plus a factor for planned sales growth or decline, by a standard percentage based on what the firm traditionally spends on advertising and what the industry averages. 19 19 19 19 17 19 19

76. Approaches to Determining the Advertising Appropriation
Objective-and-Task
Set the ultimate promotion objectives. That may relate to reach short term sales objectives .
These objectives may even relate to introducing a new product, stimulate trial, increasing distribution, etc., within a specified period of time.
Determine how much money would be required to fulfill each of these tasks in order to achieve the promotion objectives. If the cost happens to be greater that money available then the objectives should be refined or the funds are made available the contingency reserve or by reducing the budgets of the other promotional activities.
Determining the advertising budget
I. The advertising appropriation is the total amount of money a marketer allocates for advertising for a specific time period.
II. Many factors affect the amount of the advertising appropriation, including size of geographic market, distribution of buyers within the market, type of product advertised, and the firm’s sales volume relative to competitors’.
III. Various techniques are used to determine the advertising appropriation.
A. In the objective and task approach, marketers initially determine the objectives that campaign is to achieve and then attempt to list the tasks required to accomplish them. Once the tasks have been determined, their costs are added to ascertain the appropriation required to accomplish the objectives. 18 18 18 18 16 18 18

77. EXTERNAL FACILITATORS
Marketing and Advertising Research Firms
Consultants
Production Facilitators
Information Intermediator
Trade Partners

78. EXTERNAL FACILITATORS
Marketing and Advertising Research Firms
Consultants
Production Facilitators
Information Intermediator
Trade Partners

79. Broadcast Media Interactive Media Print Media Support Media
Media Organizations
and Trade Partners
Available to Marketers
Broadcast Media
Interactive Media
Print Media
Support Media
Media Conglomerates
Wholesalers, Retailers, B2B Communities, Portals

80. Media Organizations and Trade Partners Available to Marketers

81. AUDIENCES Household Consumers Trade Resellers
Business and Professional Buyers
Government and Social Organizations