Transcript Advertising and Promotion

Chapter 2
IMC Role in Marketing
Chapter Objectives
• Understand the marketing process and the role of
advertising and promotion in an organization’s
integrated marketing program.
• Know how the various decisions of the marketing
mix influence and interact with advertising and
promotional strategy.
Chapter 2 : IMC Role in Marketing
Chapter Objectives
• Understand the target market process in an
integrated marketing communications program.
• Recognize the role of market segmentation and its
use in an integrated marketing communications
program.
• Understand the concepts of market positioning
and brand positioning.
Chapter 2 : IMC Role in Marketing
Marketing and Promotions Process
Model
Chapter 2 : IMC Role in Marketing
Market Analysis
• Market opportunity analysis
– Favourable demand trends
– Unsatisfied customer needs and opportunities
– Companies compete effectively
• Competitive analysis
– Direct and indirect competition
– Competitive advantage
Chapter 2 : IMC Role in Marketing
The Target Market Process
Segment the market
Select a target market
Determine the market positioning strategy
Chapter 2 : IMC Role in Marketing
Segment the Market Bases for Segmentation
• Geographic segmentation.
– Province - region - country - climate.
• Demographic segmentation.
– Age - sex - family status - education - occupation - income
- social class.
• Psychographic segmentation.
– Values - personality traits - lifestyles.
Chapter 2 : IMC Role in Marketing
Segment the Market Bases for Segmentation
• Behaviouristic segmentation.
– Divide groups based on their usage, loyalties, buying
responses.
– Usually combined with another segment profile
• Benefit segmentation.
– Types of specific needs or wants to be satisfied.
– A variety of benefits can be derived from the same
product but for different groups.
What benefits can be derived from the purchase of a
watch?
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Select a Target Market
•
Two steps:
1. Determine how many segments to enter
2. Determine which segments offer the most potential
Three potential market coverage alternatives:
1. Undifferentiated marketing – one product for entire
market
2. Differentiated marketing – compete in segments,
different strategies for each
3. Concentrated marketing – efforts on one specific
segment in order to gain market share,
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Determine the Market Positioning
Strategy
• The final decision of the market(s) in which firms
wish to compete, combined with the specific
elements of the marketing mix designed to fulfill
the respective needs of the market(s).
Segment the
Market
Select a
Target Market
Determine the
Market positioning
strategy
The target market process
Chapter 2 : IMC Role in Marketing
Marketing Program Interaction
• Product decisions and IMC
• Price decisions and IMC
• Distribution decisions and IMC
• IMC decisions relating to marketing strategy
The notion of positioning with IMC
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Product Decisions
A product is a bundle of benefits or values
Product symbolism refers to what a product or
brand means to customers
• Product quality, branding, packaging, service,
warranties and company name contribute to
consumers’ perceptions
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Product Decisions
Branding: Positions the product in the consumers
mind.
– Brand name communicates attributes and
meaning
– Advertising creates, reinforces and maintains
brand equity
– Added value and goodwill
Chapter 2 : IMC Role in Marketing
Product Decisions
Packaging:
– Packaging has become increasingly important
– It is often the customer’s first exposure to
product
– Creates an impression of the brand
– Shape, size, colour, lettering can create a
distinct brand image and identity for a product.
• Functional aspects (Tylenol’s Safe Ty-Lock)
• Absolute Vodka – Distinct package
• Duracell package – battery tester
Chapter 2 : IMC Role in Marketing
Pricing Decisions
Price Decisions for IMC
What the consumer must give up to purchase a
product
• Cost include:
– Time
– Mental activity
– behavioural effort
Chapter 2 : IMC Role in Marketing
Pricing Decisions
• The communications strategy must be consistent
with the price of the product
• Product quality, competition, and advertising all
interact in determining what price a firm can and
should charge
• Walmart $$$
Holt Renfrew$$$$
Chapter 2 : IMC Role in Marketing
Pricing Decisions
Pricing and Advertising Strategies go together
PREMIUM PRICE = HIGH EXPECTATIONS
HIGHER AD EXPENDITURES
LOW PRICE = LOWER EXPECTATION
LOWER AD EXPENDITURES
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Distribution Decisions
Marketing channel decisions involve:
Making the product or service available for use or
consumption.
• Are consistent with product and pricing strategies.
What message/image does a product that is sold at
Holt Renfrew convey?
What message image does a product that is sold at
Walmart covey?
Chapter 2 : IMC Role in Marketing
Distribution Decisions
• Marketing channel decisions involve:
– Selecting
– Managing
– Motivating
Intermediaries/resellers
• Intermediaries (resellers): are……
– Wholesalers
– Distributors
– Brokers
– Retailers
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Promotional Push Strategy
• Programs designed to persuade the trade to
stock, merchandise, and promote a
manufacturer’s products
• The goal is to push the product through the
channels of distribution by aggressively selling
and promoting the item to the resellers, or trade
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Promotional Pull Strategy
• Spending money on advertising and sales
promotion efforts directed toward the ultimate
consumer.
• The goal is to create demand among consumers
and encourage them to request the product
from the retailer.
Chapter 2 : IMC Role in Marketing
Push Versus Pull
Push Policy
Pull Policy
Producer
Producer
Wholesaler
Wholesaler
Retailer
Retailer
Consumer
Consumer
Information Flow
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Positioning
The art and science of fitting the product or service
to one or more segments of the broad market in
such a way as to set it meaningfully apart from
competition.
How is the product positioned in the
consumers mind?
Chapter 2 : IMC Role in Marketing
Positioning
• Brand positioning strategy.
– Relates to the image of the product or brand relative to a
competing brand for a given competitive space as
defined by certain product market or category
characteristics.
• Brand position.
– The opinion a consumer has of a brand.
Chapter 2 : IMC Role in Marketing
Brand Positioning Strategy Options
• Attributes and benefits
• Price/quality
• Use or application
• Product user
• Competitor
• Repositioning
• Product class
Chapter 2 : IMC Role in Marketing
Determine the Market Positioning
Strategy
Full Service
Air Canada
Low Price
High Price
West Jet
Limited Service
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Brand Positioning Strategy Process
Positioning Strategy Process
1. Identify competitors.
2. Assess consumers’ perceptions of competitors.
3. Determine competitors’ positions in relation to
each other.
4. Analyze the consumers’ preferences.
Chapter 2 : IMC Role in Marketing
Brand Positioning Strategy Process
5. Make the brand positioning strategy decision.
• Is the segmentation approach appropriate?
• Are there sufficient resources available?
• How strong is the competition?
• Is the current brand positioning strategy working?
6. Monitor the position. Track changes in consumer
perception.
Chapter 2 : IMC Role in Marketing