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Lamb, Hair, McDaniel 2010-2011 CHAPTER 16 Integrated Marketing Communications 1 Learning Outcomes LO 1 Discuss the role of promotion in the marketing mix LO 2 Discuss the elements of the promotional mix LO 3 Describe the communication process LO 4 Explain the goal and tasks of promotion 2 Learning Outcomes LO 5 Discuss the AIDA concept and its relationship to the promotional mix LO 6 Describe the factors that affect the promotional mix LO 7 Discuss the concept of integrated marketing communications 3 The Role of Promotion in the Marketing Mix Discuss the role of promotion in the marketing mix LO1 4 The Role of Promotion Promotional Strategy A plan for the optimal use of the elements of promotion: Advertising Public Relations Sales Promotion Personal Selling LO1 5 The Role of Promotion in the Marketing Mix Overall Marketing Objectives Marketing Mix • • • • Product Place Promotion Price Target Market LO1 Promotional Mix • • • • Advertising Public Relations Sales Promotion Personal Selling Promotion Plan 6 Competitive Advantage High product quality Rapid delivery Low prices Excellent service Unique features LO1 7 The Role of Promotion in the Marketing Mix LO1 8 The Promotional Mix Discuss the elements of the promotional mix LO2 9 The Promotional Mix Combination of promotion tools used to reach the target market and fulfill the organization’s overall goals. LO2 Advertising Public Relations Sales Promotion Personal Selling 10 The Promotional Mix Most commonly distributed by traditional media, though increasingly through nontraditional media, such as Web sites, e-mail, and blogs. LO2 11 Advertising Media Traditional Advertising Media LO2 Television Radio Newspapers Magazines Books Direct mail Billboards Transit cards New Advertising Media Internet Banner ads Viral marketing E- mail Interactive video 12 Advertising Advantages Reach large number of people Low cost per contact Disadvantages Total cost is high National reach is expensive for small companies Can be microtargeted LO2 13 Public Relations Helps an organization communicate with customers, suppliers, stockholders, government officials, employees, and the community. LO2 14 The Function of Public Relations LO2 15 Sales Promotion Marketing activities— other than personal selling, advertising, and public relations—that stimulate consumer buying and dealer effectiveness. LO2 16 Sales Promotion Free samples Contests Premiums Trade Shows Vacation Giveaways Coupons LO2 End Consumers Company Employees Trade Customers 17 Personal Selling Planned presentation to one or more prospective buyers for the purpose of making a sale. LO2 18 Personal Selling LO2 Traditional Selling Attempts to persuade the buyer into a specific point of view. Win-lose outcome. Relationship Selling Long-term relationships, create a win-win outcome 19 Elements of the Promotional Mix LO2 20 Marketing Communication Describe the communication process LO3 21 Communication Communication The process by which meanings are exchanged or shared through a common set of symbols. LO3 22 Marketing Communication Categories of Communication Interpersonal Communication LO3 Mass Communication 23 Marketing Communication As Senders As Receivers Inform Develop messages Persuade Adapt messages Remind Spot new communication opportunities LO3 24 The Communication Process Noise Sender Encoding Message Message Channel Decoding Message Receiver Feedback Channel LO3 25 Characteristics of the Elements in the Promotional Mix LO3 26 Characteristics of the Elements in the Promotional Mix Advertising Communication Mode Communication Control Feedback Amount Indirect and impersonal Low Little Feedback Speed Delayed Message Flow Direction One-way Message Content Control Yes Sponsor Identification Yes Reaching Large Audience Message Flexibility LO3 Fast Same message to all audiences 27 Characteristics of the Elements in the Promotional Mix Public Relations Communication Mode Communication Control Feedback Amount Usually indirect, impersonal Moderate to low Little Feedback Speed Delayed Message Flow Direction One-way Message Content Control No Sponsor Identification No Reaching Large Audience Message Flexibility LO3 Usually fast Usually no direct control 28 Characteristics of the Elements in the Promotional Mix Sales Promotion Communication Mode Communication Control Feedback Amount Feedback Speed Message Flow Direction Usually indirect and impersonal Moderate to low Little to moderate Varies Mostly one-way Message Content Control Yes Sponsor Identification Yes Reaching Large Audience Message Flexibility LO3 Fast Same message to varied target 29 Characteristics of the Elements in the Promotional Mix Personal Selling Communication Mode Communication Control Feedback Amount Feedback Speed Message Flow Direction Direct and face-to-face High Much Immediate Two-way Message Content Control Yes Sponsor Identification Yes Reaching Large Audience Message Flexibility LO3 Slow Tailored to prospect 30 Web 2.0 • • • • Blogs (online journals) Podcasting (online radio) Vodcasts (online videos) Social Networks (Facebook, MySpace, Twitter) LO3 31 Blogging Corporate Blogs Sponsored by a company or one of its brands and maintained by one or more of the company’s employees. Independent and not Noncorporate associated with the Blogs marketing efforts of any particular company or brand. LO3 32 The Communication Process Sender Feedback channel Receiver Message to be conveyed Message that was understood Encode message Decode message Transmit message Receive message LO3 Message channel 33 The Goals and Tasks of Promotion Explain the goals and tasks of promotion LO4 34 Goals and Tasks of Promotion Informing Reminding Target Audience Persuading LO4 35 Goals and Tasks of Promotion Informing Reminding PLC Stages: PLC Stages: Introduction Early Growth Maturity Target Audience PLC Stages: Growth Maturity Persuading LO4 36 Goals and Tasks of Promotion Informative Promotion Increase awareness Explain how product works Suggest new uses Build company image LO4 37 Goals and Tasks of Promotion Persuasive Promotion Encourage brand switching Change customers’ perceptions of product attributes Influence immediate buying decision Persuade customers to call LO4 38 Goals and Tasks of Promotion Reminder Promotion Remind customers that product may be needed Remind customers where to buy product Maintain customer awareness LO4 39 Barbie in China With Barbie’s U.S. sales diminishing, Mattel moved into China in a grand way. They opened a sixstory Barbie life-style store in Shanghai, which includes a spa, café, bar, and racks of Barbie Clothing. Mattel is aiming Barbie toward a new audience: club-age young women. By introducing Barbie into a culture unfamiliar with her, Mattel has the opportunity to expand Barbie’s appeal. LO4 Source: Rein, Shaun. “Barbie Goes to China,” Forbes.com, March 9, 2009. 40 Promotional Goals and the AIDA Concept Discuss the AIDA concept and its relationship to the promotional mix LO5 41 The AIDA Concept AIDA Concept Model that outlines the process for achieving promotional goals in terms of stages of consumer involvement with the message. Attention Interest Desire Action LO5 42 The AIDA Concept Action Desire Interest Attention LO5 Conative (doing) Affective (feeling) Cognitive (thinking) 43 The AIDA Concept LO5 44 Factors Affecting the Promotional Mix Describe the factors that affect the promotional mix LO6 45 Factors Affecting the Choice of Promotional Mix Nature of the product Stage in PLC Target market factors Type of buying decision Promotion funds Push or pull strategy LO6 46 Sales ($) Stage in the Product Life Cycle Maturity Introduction Growth Decline Time Light Advertising; preintroduction publicity LO6 Heavy use of Advertising; PR for awareness; sales promotion for trial Advertising, PR, brand loyalty; personal selling for distribution Ads decrease; sales promotion; personal selling; reminder & persuasive AD/PR decrease; limited sales promotion; personal selling for distribution 47 Target Market Characteristics For… Advertising Widely scattered market Sales Promotion Informed buyers Less Personal Selling LO6 Brand-loyal repeat purchasers 48 Type of Buying Decision Advertising Routine Sales Promotion Neither Routine nor Complex Advertising Public Relations Personal Selling Complex Print Advertising LO6 49 Available Funds Trade-offs with funds available Number of people in target market Quality of communication needed Relative costs of promotional elements LO6 50 Push and Pull Strategies PUSH STRATEGY Manufacturer promotes to wholesaler Wholesaler promotes to retailer Retailer promotes to consumer Consumer buys from retailer Orders to manufacturer PULL STRATEGY Manufacturer promotes to consumer Consumer demands product from retailer Retailer demands product from wholesaler Wholesaler demands product from manufacturer Orders to manufacturer LO6 51 Factors Affecting Promotional Mix Nature of the product Push or pull strategy Funds available LO6 Promotional Mix % Advertising % Public Relations % Sales Promotion % Personal Selling Product life cycle Target market characteristics Type of buying decision 52 Integrated Marketing Communications Discuss the concept of integrated marketing communications LO7 53 Integrated Marketing Communications Integrated Marketing Communications The careful coordination of all promotional messages to assure the consistency of messages at every contact point where a company meets the consumer. LO7 54 IMC Popularity Growth Proliferation of thousands of media choices Fragmentation of the mass market Slash of advertising spending in favor of promotional techniques that generate immediate response LO7 55 Integrated Marketing Communications LO7 56