Think Marketing

Third Edition

Chapters 15 and 16
IMC and Global Marketing

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Learning Outcomes
1. Identify the role and function of various consumer
promotion activities.
2. Identify the role and function of various trade promotion
activities.
3. Explain the role of experiential marketing in marketing
today.
4. Describe the role of personal selling in the marketing
communications mix.
5. Describe the basic steps in the selling process.

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Learning Outcomes
1. Outline the importance of International trade for Canada
and Canadian corporations
2. Describe the factors an organization considers when
pursuing global markets
3. Outline the various business strategies commonly used
when entering foreign markets.
4. Describe the nature of marketing strategies used by firms
when seeking global market opportunities.

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Sales Promotion
“Activity that provides special incentives to bring about
immediate action from consumers, distributors, and the
organization’s sales force.”

“Advertising appeals to the heart and sales

promotion to the wallet.”

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Sales Promotion
There are two principle kinds of sales promotion:

Consumer Promotion
Activity promoting extra brand sales by offering the
consumer an incentive over and above the product’s
inherent benefits.

Trade Promotion
Promotional activity directed at distributors that is designed
to increase sales volume and encourage merchandising
support for a manufacturer’s product.

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Consumer Promotion
Incentives offered consumers to prompt extra brand sales.
The incentives are part of a “pull” strategy used at point-of-
sale.

Manufacturer Wholesaler Retailer Consumer

• Trial purchase
Promotion • Repeat purchases (loyalty)
Objectives
• Multiple purchases

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Consumer Promotion Activities
Marketers have many good options available to stimulate
brand sales.
• Coupons
• Free Samples
• Contests
• Cash Refunds and Rebates
• Premiums
• Loyalty (Frequent Buyer) Programs

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Coupon Strategies
“Price-saving incentives to motivate immediate purchase of a
specific product.”

Direct mail, print media and online

Media-Delivered delivery of coupons achieve trial
Coupons purchase objectives; useful in
introduction and growth stages.

In-pack and on-pack delivery of

Product-Delivered coupons helps achieve loyalty
Coupons objectives; useful in late growth and
mature stages.

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Coupon Strategies: Applied

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Free Sample Strategies
Free product distributed to potential users in trial sizes or
regular sizes; an effective strategy when launching a new
product.

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Loyalty Programs
Programs that offers consumers some kind of bonus or
incentive when they make a purchase.
Figure 15.6 Some Different Types of Customer Loyalty Programs

Type Description of Program

Fast food and coffee chains hand out cards that get stamped or
Appreciation punched with each purchase. After a certain number of
purchases, the customer receives a “free” coffee/food item.
The consumer collects points, dollars, or miles with rewards
Rewards
related to the company’s business (e.g., Canadian Tire money).
Consumers earn points with purchases from partner companies
Partnerships (e.g., Air Miles partners with Shell Canada, Rexall, Safeway,
Metro, and Budget car rentals, among others).
Shoppers are offered rebates based on the amount they spend.
Rebates Costco’s executive membership offers a 2 percent annual rebate
on most purchases.

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Loyalty Strategies: Applied

Special sales and free

offers to customers in
the Shoppers Drug
Mart database
encourage customers
to visit the stores more
frequently and to buy
more goods.

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Trade Promotion
“Incentives offered distributors to secure marketing support.”
The incentives offered are part of a “push” strategy.

Manufacturer Wholesaler Retailer Consumer

• Secure listings
Promotion • Increase volume
Objectives
• In-store merchandising activity

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Trade Promotion Strategies (1 of 2)
Trade promotion offers that help push a product through the
channel and improve sales in retail stores include:
• Cooperative Advertising
• Trade Allowance
• Performance Allowance
• Dealer Premium
• Dealer-Display Material (POS)

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Trade Promotion Strategies (2 of 2)

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Experiential Marketing
“A type of marketing that creates awareness of a product by
having the customer interact directly with the product.”

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Events and Sponsorships
Event marketing and sponsorships fall under the umbrella of
experiential marketing.

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Primary Types of Sponsorships

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Sports Sponsorship
Figure 15.14 The Various Levels of Sports Event Marketing

Costs associated with sponsorship increase at each level.

Local Regional National International Global

Minor sports Ontario Summer Canada Summer U.S. Open Olympic Games
programs, road Games, OHL, Games, (Golf), Tour de
races for Western Jr. Canadian France, British
charitable Hockey League Curling Grand Prix
causes Championship

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Venue Marketing
A company or brand is linked to a physical site, such as a
stadium, arena or theatre.

• Air Canada Centre

• Rogers Arena

• Rexall Place

• Bell Centre

In what cities are these buildings?

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Festivals, Fairs and Annual Events
Sponsorships

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Cause Marketing Sponsorships

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Strategic Considerations for Event
Marketing
The fit between the event and the sponsor must be a good
one.
The following principles should guide the decision to
participate:
• Select events offering “exclusivity”
• Use sponsorships to complement other promotional
activity
• Choose the target carefully
• Select an event with an image that sells
• Establish firm selection criteria
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Analyzing Global Market Opportunities
The external environments of foreign markets must be
analyzed before deciding to enter.

• Economic
• Consumers
• Political Marketing
• Legal/Regulatory Strategy

• Technical
• Competition

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Economic Environment
Economic variables such as natural resources, population,
income distribution, employment and education are
evaluated.

There are three broad classifications of economies:

• Government-Controlled Economy
• Market-Controlled Economy
• Mixed Economy

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The Nature of Global Economies
Figure 16.2 The Nature of Global Marketing Economies
Government-Controlled Market-Controlled
Mixed Economy
Economy Economy
• Strong central • Market operates by • Simultaneous operations
government makes voluntary exchange of publicly and privately
economic decisions owned companies
• Consumers usually have • Consumers have much • Some government
much less product product choice control to protect local
choice industries and workers
• Government controls • Laws of supply and • Laws of supply and
industries and demand prevail demand prevail
companies
• Difficult market to enter • Effective marketing • Possible barriers to entry
essential for company for foreign companies
growth

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Consumer Environment (1 of 2)
Variations is culture and language creates a need for diverse
marketing strategies in foreign markets.

Even within foreign countries a marketer should examine

differences in:
• Culture
• Language
• Needs and Motivation

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Political Environment
Government policies, laws and regulations must be abided
by. New governments can change the rules.

Example:
In the 1970s the government of India ordered Coca-Cola to
dilute its investment there and to turn over its secret formula;
Coca-Cola had no choice but to pull out completely. Coca-
Cola did not return until 1993, when a more liberalized
government was in power.

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Trade Barriers
To protect local industries a country may resort to any
number of tactics.
• Tariff

• Quota

• Local Content Law

• Embargo

• Boycott

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Legal and Regulatory Environment
Marketers must know what they can and cannot do with a
product in a foreign country. Awareness of local laws for
packaging and advertising are essential.

Example:
• Packaging in Canada must be bilingual; therefore, U.S.
companies must develop separate packages if they pursue
the Canadian market.

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Technology Environment
Technology presents opportunities for developing new
products and how marketing activities are performed.

An organization must ensure that a foreign country has the

technology and skill required to make and market its
products.
Example:
When Japanese and South Korean auto companies began
producing in Canada the skills existed but Canadian
employees had to be educated in their management style
and way of doing business.
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Market Entry Strategies
Figure 16.5 Strategies for Entering Global Markets
Risk Commitment Control
Export Joint Ventures Direct Investments
Direct Licensing Manufacturing facilities
Indirect Contract manufacturing Assembly facilities
International franchising Acquire local company

Risk, commitment, and control increase as a marketing organization

moves from simply exporting goods to a foreign country to actually
manufacturing the goods in a foreign country.

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Marketing Strategy for Global Markets (1 of 2)
The assessment of the external environment leads to a
marketing strategy decision.

Global Same marketing strategy in all

Strategy foreign markets

Country-Centered Unique marketing strategy for

Strategy each foreign market

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Product Strategy
There are three commonly used product strategies:

Standardized Same product offered in all

Product foreign markets.

Adapted Product altered to local tastes;

Product common in fast food industry.

Local Evaluate local tastes and

Product develop accordingly.
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Characteristics of Truly Global Brands
Some Characteristics of Strong Brands

• Has leadership at home • Has a compelling platform • Is obsessed with

that propels it beyond innovation
domestic borders
• Is associated with its country • Is ever-renewing and is • Makes money
of origin tailored to local markets

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Price Strategy
Foreign market conditions influence price strategy.

• Local competition
• Value of currency
• Trade restrictions in place

Dumping: selling goods at a much lower price in a foreign

market; dumping is often an issue among local competitors.

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