An Introduction to Integrated Marketing Communications

Tutored by : Prof. Sunil D Anto

The Growth of Advertising and Promotion

Expenditure in Billions of Dollars
Advertising Outside U.S. U.S. Sales Promotion 2004 1980

U.S. Advertising

$0

$50

$100

$150

$200

$250

$300

$350

What is Marketing?
Value Marketing :

- As an exchange function (of value, information..) - Focus on customer relationship & value

Relationship marketing Mass customization Customer relationship management (CRM)

Traditional Approach to Marketing Communications

Point of purchase

Publicity

Sales promotion

Special events

Media Advertising

Packaging

Direct response

Public relations Direct marketing

Interactive marketing

Separate, non-related, non-sync

Evolution of IMC
The call for synergy, strategic integration & broader outlook starts in 1980s
The American Association of Advertising Agencies (4As) developed one of the first definitions of IMC, defining it as: 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 for example, general advertising, direct response, sales promotion, and public relations- and combines these disciplines to provide clarity, consistency, and maximum communications impact.

..for 3Cs (Clarity, Consistency, Constancy) & for max impact

Contemporary Definition of IMC

IMC is a strategic business process used to plan, develop, execute and evaluate coordinated, measurable, persuasive brand communication programs with consumers, customers, prospects employees and other relevant external and internal audiences (*the stakeholders) . - Don Schultz, Northwestern University, USA

The goal of IMC is to generate short-term financial returns (ROMCI) and build long-term brand value.

A Contemporary Perspective of IMC

Recognized as a business process

IMC

Importancerelevant audiences Multiple of relevant audience Demand for accountability and Demand for accountability Measurement of Outcomes

2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

Contemporary IMC Approach

Packaging Sales promotion Direct response

Point of purchase Publicity

Media Advertising

Public relations

Interactive marketing

Direct marketing

Special events

One Look One Voice

Reasons for the Growing Importance of IMC

From
Media advertising Mass media Manufacturer dominance General focus Low agency accountability Traditional compensation Limited Internet availability

Toward
Multiple forms of communication tools (EM&S, DM, SP, IM..) Specialized media Retailer dominance Data-based , targeted marketing marketing Greater agency accountability
Performance-based compensation

Widespread Internet availability

IMC and Branding

Brand Identity is a combination of factors: Name, logo, symbols, design, packaging, product or service performance, and image or associations in the consumers mind. IMC plays a major role in the process of developing and sustaining brand identity and equity.

2005 Brand Value

(Billions of Dollars)

1. Coca-Cola 2. Microsoft 3. IBM 4. GE 5. Intel 6. Nokia 7. Disney 8. McDonalds 9. Marlboro 10. Mercedes

$67.52 $59.94 $53.38 $46.99 $35.59 $26.45 $26.44 $26.01 $24.84 $21.19

Basic Elements of the Promotional Mix

Advertising Direct Marketing Interactive/ Internet Marketing Sales Promotion Public Relations Publicity/Public (&Publicity) Relations

*ADISaPP

Personal Selling

Advertising
Paid forms of non-personal communication
About an organization, product, service, or idea by an identified sponsor No feedback from audience Important for products and services aimed at mass consumer markets Cost effective ?

Classifications of Media Advertising

National Advertising

Retail/Local Advertising Primary vs. Selective Demand Advertising

Consumers
Business-to-Business Advertising

Professional Advertising

Trade Advertising

Organizations

Direct Marketing constituents

Direct Mail Internet Sales Direct Response Advertising

Direct Marketing
Shopping Channels Catalogs Telemarketing

DM Advantages & Disadvantages

Advantages: changes in society (two-income households, greater use of credit) have made consumers more receptive to the convenience of direct-marketed products allows a company to be very selective and target its marketing communications to specific customer segments messages can be customized to fit the needs of specific market segments effectiveness of direct-marketing efforts are easier to assess than other forms of promotion Disadvantages: consumers and businesses are being bombarded with unsolicited mail and phone calls which makes them less receptive to direct-marketing direct marketing has image problems problems with clutter as their are too many direct-marketing messages competing for consumers attention !

Bose Uses Direct Response Advertising

Interactive/Internet Marketing
Interactive media Internet Media Storage devices (DVD-R, CD-ROMs, etc.) Kiosks Interactive television Digital cell phones Back-and-forth communication Happens in real time Users participate in and modify the form and content of information

Characteristics of IM as an IMC Tool

The Internet

Educates or informs customers

A persuasive communication advertising medium

A sales tool or an actual sales vehicle

Obtains customer database information

Communicates and interacts with buyers

Provides customer service and support

Builds and maintains customer relationships

Sales Promotion Tools

Coupons Samples Premiums
Contests/Sweepstakes

Trade Allowances

POP Displays Training Programs Trade Shows Co-op Coop Advertising

Refunds/Rebates Bonus Packs Loyalty Programs Events

Consumer-oriented
[For end-users]

Trade-oriented
[For the channel]

Various Uses of Sales Promotion

Introduce new products Get existing customers to buy more

Combat competition

Attract new customers

Sales Promotion
Enhance personal selling Maintain sales in off season

Tie in advertising & personal selling

Increase retail inventories

2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

Public Relations

is the process of systematically planning and distributing information in an attempt to control and manage image and the nature of the publicity received.

Advertising Vs. PR
Factor Control Credibility Reach Advertising Great Lower Measurable Schedulable Publicity Little Higher Undetermined

Frequency
Cost Flexibility Timing

Uncontrollable
Low/Unspecified

High/Specific
High Specifiable

Low Tentative

Public Relations Tools

Publicity Vehicles * Vehicles

Special Publications

Community Activities

Corporate Advertising

Cause-related Marketing

Public Affairs Activities

Special Event Sponsorship

* Publicity Vehicles
Feature Articles

News Releases

Publicity Vehicles

Interviews

Press Conferences

Special Events

IMC Audience Contact Tools

Broadcast media (TV/radio)
Print media (newspapers, magazines)

Public Relations/ publicity

Internet/ interactive

Out-of-home (OoH) media

Direct marketing

Target Audience
(Mr./Ms. Hu Ku) *
Personal selling Sales Promotion

Point-of-purchase (displays, packaging)

Word-of-mouth

Events and sponsorship

Product placements (TV and movies)

The Marketing Plan

1. A detailed situation analysis

2. Specific marketing objectives

3. A marketing strategy and program

4. A program for implementing the strategy

5. A process for monitoring and evaluating performance

Integrated Marketing Communications Planning Model

Review of marketing plan Promotional program situation analysis Analysis of the communications process Budget determination Develop integrated marketing communications programs Advertising Sales promotion Sales promotion objectives Sales promotion strategy PR/ publicity PR/ publicity objectives PR/ publicity strategy Personal selling Personal selling objectives Personal selling strategy Direct marketing Direct marketing objectives Direct marketing strategy Internet/ interactive Internet/ interactive objectives Internet/ interactive strategy

Advertising objectives
Message strategy

Integrate and implement marketing communications strategies

Monitor, evaluate and control IMC Program