Transcript Chapter 15 - Cengage Learning

Chapter 15
Integrated
Marketing
Communications
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Chapter Objectives
1. Explain how integrated marketing communications
relates to the development of an optimal promotional
mix.
2. Describe the communication process and how it relates
to the AIDA concept.
3. Explain how the promotional mix relates to the
objectives of promotion.
4. Identify the different elements of the promotional mix
and explain how marketers develop an optimal
promotional mix.
5. Describe the role of sponsorships and direct marketing
in integrated marketing communications.
6. Contrast the two major alternative promotional
strategies.
7. Explain how marketers budget for and measure the
effectiveness of promotion.
8. Discuss the value of marketing communications.
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 Promotion
Function of informing, persuading, and
influencing the consumer’s purchase
decision
 Marketing Communications
Transmission from a sender to a
receiver of a message dealing with the
buyer-seller relationship
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Integrated Marketing Communications
 Coordination of all promotional activities –
media advertising, direct mail, personal
selling, sales promotion, and public
relations – to produce a unified customerfocused promotional message
 Importance of Teamwork
IMC requires a total strategy including
all marketing activities, not just
promotion
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 Role of Databases in Effective IMC
Programs
With the growth of the Internet,
marketers have been given the power
to gather information faster and to
organize it easier than ever before
By sharing this knowledge
appropriately among all relative
parties, a firm can lay the foundation
for a successful IMC program
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The Communications Process
 An effective promotional message
accomplishes three tasks:
It gains the receiver’s attention
It achieves understanding by both
receiver and sender
It stimulates the receiver’s needs and
suggests an appropriate method of
satisfying them
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 AIDA concept (Attention-InterestDesire-Action) – an explanation of the
steps through which an individual
reaches a purchase decision
Sender
Encoding
Channel
Decoding
Response
Feedback
Noise
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 Global Difficulties with the Communication
Process
 In China: KFC’s slogan: “Finger lickin’ good” came
out as “Eat your fingers off”
 Also in China: Coca-Cola had thousands of signs
made using the translation: “Ke-kou-ke-la”
 Depending on the dialect this means . . .
 “Bite the wax tadpole,” or
 “Female horse stuffed with wax”
 In Taiwan: Pepsi’s slogan, “Come alive with the
Pepsi generation” came out as “Pepsi will bring
your ancestors back from the dead”
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Objectives of Promotion
 Provide Information
 Increase Demand
 Differentiate the Product
 Accentuate the Product’s Value
 Stabilize Sales
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Elements of the Promotional Mix
 Promotional mix: blend of personal selling
and nonpersonal selling designed to achieve
promotional objectives
Personal selling: interpersonal
promotional process involving a seller’s
person-to-person presentation to a
prospective buyer
Nonpersonal selling includes:
Advertising, Product placement, Sales
promotion, Direct marketing, Public
relations
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 Advertising
Paid, nonpersonal communication through
various media by a business firm, not-forprofit organization, or individual identified
in the message with the hope of informing
or persuading members of a particular
audience
 Product Placement
Marketer pays a motion picture or
television program owner a fee to display
his or her product prominently in the film
or show
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 Sales Promotion
Marketing activities that stimulates
consumer purchasing (includes: displays,
trade shows, coupons, premiums,
contests, product demonstrations, and
various nonrecurrent selling efforts)
Trade promotion
 Direct Marketing
Direct communications other than
personal sales contact between buyer
and seller, designed to generate sales,
information requests, or store visits
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 Public relations: firm’s communications
and relationships with its various publics
 Publicity: stimulation of demand for good,
service, place, idea, person, or organization
by unpaid placement of commercially
significant news or favorable media
presentations
 Guerilla Marketing: Unconventional,
innovative, and low-cost marketing
techniques designed to get consumers’
attention in unusual ways.
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Sponsorships
 Provision of funds for a sporting or cultural
event in exchange for a direct association with
the events or activity
 Growth of Sponsorships
 How Sponsorship Differs from Advertising
Sponsor’s degree of control, Nature of the
message, Audience reaction
Ambush marketing
 Assessing Sponsorship Results
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 Direct Marketing Communication Channels
Telephone
Direct Mail
Television
Newspaper
Magazine
Radio
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 Direct Mail
Marketers combine information from
internal and external databases, surveys,
coupons, and rebates that require
responses to provide information about
consumer lifestyles, buying habits, and
wants
 Catalogs
Over 10,000 different consumer mail-order
catalogs and thousands more for
business-to- business sales are mailed
each year generating over $57 million in
consumer sales and $36 million in B2B
sales
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 Telemarketing: promotional presentation
involving the use of the telephone for
outbound contacts by salespeople or
inbound contacts initiated by customers who
want to obtain information and place orders
 Direct Marketing via Broadcast Channels
Broadcast direct marketing includes:
Brief (30 to 90 and second) direct
response ads on television or radio
Home shopping channels like:
Quality Value Channel (QVC)
Home Shopping Network (HSN)
Infomercial
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 Electronic Direct Marketing Channels
Web advertising is an important component
of electronic direct marketing
E-mail direct marketing is a natural and
easy extension of traditional direct mail
marketing
 Other Direct Marketing Channels
Print media is generally not as effective as
Web marketing or telemarketing for direct
marketers
Magazine and newspaper ads with toll-free
telephone numbers, kiosks, and other
media are still useful in many situations
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Developing an Optimal Promotional Mix
 Factors that influence the effectiveness of
a promotional to mix:
Nature of the market
Nature of the product
Stage in the product life-cycle
Price
Funds available for promotion
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Pulling and Pushing
Promotional Strategies
 Pulling strategy: promotional effort by a
seller to stimulate demand among final users,
who will then exert pressure on the
distribution channel to carry the good or
service, pulling it though the marketing
channel
 Pushing strategy: promotional effort by a
seller to members of the marketing channel
intended to stimulate personal selling of the
good or service, thereby pushing it through
the marketing channel
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Budgeting for Promotional Strategy
 Percentage-of-sales method
 Fixed-sum-per-unit method
 Meeting competition method
 Task-objective method
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Measuring the Effectiveness of Promotion
 Two basic measurement tools:
Direct sales results measures the
effectiveness of promotion by revealing
the specific impact on sales revenues
for each dollar of promotional spending
Indirect evaluation concentrates on
quantifiable indicators of effectiveness
like:
Recall
Readership
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 Measuring Online Promotions
Early attempts at measuring online
promotional efforts involved counting hits
and visits
Incorporating direct response and
comparing different promotions for
effectiveness
Two major techniques for setting online
advertising rates:
Cost per impression (CPM)
Cost per response (click-throughs)
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The Value of Marketing Communications
 Social Importance
Criticisms of promotional messages as
tasteless and lacking any contribution to
society sometimes ignore the fact that society
provides no commonly accepted set of
standards
The one generally accepted standard in a
market society is freedom of choice for the
consumer
Promotion has become an important factor in
campaigns aimed at achieving socially
oriented objectives like the elimination of drug
abuse
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 Business Importance
Promotional strategy has become
increasingly important to both small and
large firms
Both business and nonbusiness
enterprises recognize the importance of
promotional efforts
 Economic Importance
Effective promotion has allowed society to
derive benefits not otherwise available
Subsidizes the information contents of
newspapers and the broadcast media
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