Transcript KOM 5325 (INTEGRATED MARKETING COMMUNICATIONS)

Integrated Marketing Communications
(KOM 5325)
Hamisah Zaharah Hasan, PhD
[email protected]
03-8946 8667
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.
Course Objectives:
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analyze the differences between
the major marketing
communication functions (C4);
•
evaluate a company’s marketing
and promotional
situation (P4);
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develop effective Integrated
Marketing
Communications strategies and
programs (A4) and
contribute to the planning and
coordinating of group
work (CS, LL)
Course Evaluation
Assignment 1 :
Midterm exam :
Group project :
Final exam :
10 points
20 points
30 points
40 points
Welcome to 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.
• Advertisers were not clear of
advertising in the new millennium …..
• The industry realized its vulnerability
to the outside world
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.
• Many marketers
manage its various
marketing &
promotional functions
separately. Different
budgets, views of
market, goals &
objectives.
• 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
…. 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
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 …..
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
….. 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.
….. 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.
Significant marketing
development
Added value of integrating
various communication
functions
Maximize return on
investment
Media
VS
INTERNET, VCD,
DVD, MOBILE
PHONE
RADIO/TV/MAGAZINES/
NEWSPAPER
AVOID DUPLICATION ---- integrate marcom
activities
NEW TECHNOLOGY NEW ENVIRONMENT --- new
ways to reach consumers
DIFFERENT CONSUMERS ----- sophisticated,
demanding,
EXPENSIVE TRADITIONAL MEDIA
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
INTRODUCTION
to
PROMOTION
and
INTEGRATED MARKETING
COMMUNICATIONS
Relationship Between Promotion,
the Promotional Mix, and
Integrated Marketing Communications
PROMOTION
• 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
INTEGRATED MARKETING COMMUNICATIONS (IMC)
• Manages the Processes and Activities of Using Promotional Tools
• Unified Way
• Produces a Synergistic Communications Effect
1.3
• Promotion:
• Process
• Promotion Mix:
• Tools
• IMC:
• Management of the
Promotion Mix
1.4
The Promotional Mix
ADVERTISING
 Paid Mass Media Attempt to Persuade
 Complex System of Strategic Planning and
Creative Genius
INTERNET ADVERTISING
 Electronic Mail (e-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
ADVERTISING
Example of Sales Promotion
Example of Mass
Media
Advertising
1.6
Example of Sales Promotion
1.7
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
shelf-talkers, signage, easel stands,
bottle-neckers, price cards, hangtags, 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
SUPPORTIVE COMMUNICATIONS
Used to Target Audiences Outside
Mainstream Media or Electronic
Communications
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
Personal Selling is the Most
Important Variable in the
Promotional Mix of Many
Organizations
1.11
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
1.12
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
ROLE OF PROMOTION IN THE MARKETING
MIX
– Assumes a Wide Range of Responsibilities
Related to:
• Conception
• Pricing
• Distribution Brands
– Product (Brand)
1.14
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
• Building and Maintaining Brand Loyalty
Within the Trade
1.15
One Role for Promotion is to
Help Introduce Brand Extensions
Like this Extension of Jell-O into
the Yogurt Market
1.16
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
• Promotion is Important in Helping to
Execute These Strategies
– Market Segmentation
– Product Differentiation
– Positioning
• External
• Internal
1.18
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
Promotional Tools Help
Increase Brand Loyalty
1.20
Integrated Marketing Communications
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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
Promotion and IMC
Help Cut Through the
Clutter of Advertising
1.22
Participants in IMC Management
Marketing Organization
•Marketing Plan
•Goal & Objectives
•Customer/Prospect
Databases
Advertising Agency
•Research
•Creative Strategies
•Production
•Message Placement
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
IMC Management
Personal Selling
Public Relations
Advertising
Sales Promotions
P-O-P
Internet Advertising
Supportive
Direct Marketing
e-Commerce
Sales Promotions
1.23
1.22
THE PROMOTION
INDUSTRY:
MARKETERS,
AGENCIES,
and
MEDIA
ORGANIZATIONS
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
Growing Investment in Advertising Causes
Media Clutter
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
Structure of the Promotion Industry and Participants in the Process
Marketers
Manufacturers
and service firms
Resellers, retailers,
wholesalers, and
distributors
Government and
social organizations
Advertising and
Promotion Agencies
Advertising agencies:
Full-service agencies
Creative boutiques
Media-buying services
Interactive agencies
In-house agencies
Promotion agencies:
Direct marketing and
database agencies
E-Commerce agencies
Event planning
Design firms
Public relations firms
Sales staffing and training
firms
Agency services:
Account services
Marketing research
Creative and production
services
Media planning research
Agency compensation:
Commission
Markup charges
Fee system
Pay-for-results
Marketing and
advertising research
firms
External Facilitators
Production facilitators
Consultants
Information
intermediators
Media Organizations
And Trade Partners
Media Organizations:
Broadcast media
Print media
Interactive media
Support media
Media conglomerates
Trade Partners:
Wholesalers, distributors,
retailers
B-to-B trade
communities
Internet portals
Target Audience(s)
Household consumers
Trade resellers
Business and professional
buyer
Government and social
organizations
Structure of Promotion Industry
MARKETERS
• Manufacturing and Service Firms
• Trade Resellers
• Federal, State and Local Governments
• Social Organizations
– March of Dimes
– Nature Conservancy
– MAKNA
Producer of
Consumer
products and
services, etc…
Organizations
that that buy
products to
sell to
consumers
2.5
2.5
The U.S. Government is a
Marketer that Relies on
Advertising
2.5
Structure of Promotion Industry (con’t)
AGENCIES
– Advertising Agencies
• Full Service Agency
• Creative Boutique
• Interactive Agency
• In-House Agency
• Media-Buying Agency
Grey Global Group,
Omnicom Group
Idea
factories
Visit http://www.ad4ever.com
Gap, Calvin
Klein, Revlon do
their own inhouse work
A German advertising agency with the
colorful name "indigo:"
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
Design Firms Help
Marketers Develop Logo
Designs that Last,
Like this Pillsbury Logo
2.9
AGENCIES
Agency Services
Account Services
Marketing Research
Creative & Production
Creative Services
Production Services
Media-Planning and Buying
Administrative
AGENCIES (con’t)
–Agency Compensation
•Commissions
•Markup Charges
•Fee System
•Pay-for-Results
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.
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.
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.
%
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.
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EXTERNAL FACILITATORS
Marketing and Advertising
Research Firms
Consultants
Production Facilitators
Information Intermediator
Trade Partners
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EXTERNAL FACILITATORS
Marketing and Advertising
Research Firms
Consultants
Production Facilitators
Information Intermediator
Trade Partners
Media Organizations
and Trade Partners
Available to Marketers
 Broadcast Media
 Interactive Media
 Print Media
 Support Media
 Media Conglomerates
 Wholesalers, Retailers,
B2B Communities, Portals
Media Organizations and Trade Partners Available
to Marketers
AUDIENCES
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Household Consumers
Trade Resellers
Business and Professional Buyers
Government and Social
Organizations