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An Introduction

to Integrated
Marketing
Communication

Lecture-1

Incredible India capture the world through Integrated


Communications

Marketing: American Marketing Association (AMA), the organization that


represents marketing professionals in the United States and Canada, defined
marketing as the process of planning and executing the conception, pricing,
promotion, and distribution of ideas, goods, and services to create exchanges
that satisfy individual and organizational objectives.

This definition of marketing focused on exchange as a central concept in


marketing and the use of the basic marketing activities to create and sustain
relationships with customers

Marketing Focuses on Relationships and Value

AMA adopted a revised definition of marketing in 2004, which is as follows:

Marketing is an organizational function and a set of processes for creating,


communicating and delivering value to customers and for managing customer
relationships in ways that benefit the organization and its stakeholders.

Value is the customers perception of all of the benefits of a product or service weighed
against all the costs of acquiring and consuming it. Benefits can be functional (the
performance of the product), experiential (what it feels like to use the product), and/or
psychological (feeling such as self-esteem or status that result from owning a particular
brand). Costs include the money paid for the product or service as well as other factors
such as acquiring information about the product/service, making the purchase, learning
how to use it, maintaining the product, and disposing of it. The focus on customer
relationships and value has led many companies to emphasize relationship marketing,
which involves creating, maintaining, and enhancing long-term relationships with
individual customers as well as other stakeholders for mutual benefit.

Advances in information technology, along with flexible manufacturing


systems and new marketing processes, have led to mass customization,
whereby a company can make a product or deliver a service in response to a
particular customers needs in a cost-effective way.

Marketers are giving more attention to the lifetime value of a customer


because studies have shown that reducing customer defections by just 5
percent can increase future profit by as much as 30 to 90 percent. As
companies focus more attention on customer retention, many are developing
customer relationship management (CRM) programs.

Consumers can log on to the Dell website and build their own computers
or to NikeiD.com to design personalized athletic shoes and other products.

Marketing Mix

These four Psproduct, price, place (distribution), and promotionare


elements of the marketing mix. The basic task of marketing is combining
these four elements into a marketing program to facilitate the potential for
exchange with consumers in the marketplace.

The primary is on one element of the marketing mix: the promotional


variable

Understanding Marketing
Communication

Marketing communication is an important P of marketing. It involves all


activities concerned with effectively communicating product information to
selected target audience.

A target audience is the group of consumers to whom marketing


communication messages are directed.

All marketing communication is done with a purpose . The prime purpose of


communication is to seek a cognitive, affective and behavioural response.

Marketing Communication Mix

Marketing communication is the set of all tools to promote a product. We can


divide these marketing communication mix tools in to High and Low control
messages.

High Control messages are those elements of the communication mix over
which an organization has greater control since they can be explicitly
planned, executed and delivered to consumers. E.g. Advertising, sales
Promotion, Direct Marketing, Special events etc.

Low control messages are spontaneous and not designed formally. E.g. an
organisations crisis management, Shareholders Interaction, Employee
Behaviour, Gossip, Consumer word of Mouth etc.

COMMUNICATION MIX TOOLS

Traditionally the promotional mix has included four elements: advertising, sales
promotion, publicity/public relations, and personal selling.

Each element of the promotional mix is viewed as an integrated marketing


communications tool that plays a distinctive role in an IMC program. Each may
take on a variety of forms. And each has certain advantages.

Advertising

Interactive/ Internet marketing

Sales promotion

Direct marketing

Publicity/ public relations

Personal selling

Unconventional Media

Packaging

Point of Purchase (POP) or Merchandise Material

Advertising Specialities

Sponsorships

Event Marketing

Trade shows and Exhibits

Customer Service

ADVERTISING
The non-personal
presentation of
ideas and
products by an
identified sponsor.

**PAID FOR**

ADVERTISING

The word advertising is derived from its Latin root ad verter, which means
to turn towards and to attract attention to.

According to Philip Kotler & American Marketing Association. The


advertising is any paid form of non personal presentation of

Ideas

Goods

Services by an identified sponsor that is called Advertising.

Objectives of Advertising

Inform

Persuade

Remind

Reinforce

Types of Advertising: Classified on the basis of


the nature or purpose of advertisement

Brand Building Advertisement

Tactical Advertising- Direct Response Advertising

National Advertising

Retail Advertising

Public Service Advertising

Corporate Advertising

Trade Advertising

SALES PROMOTION
2 for 1 Sale
Buy One,
Get One
Free
stimulate

purchases
increase store traffic

$2 off
after 8PM
on Tuesday

SALES PROMOTION
Marketing activities-other than
personal selling, advertising and
public relations-that stimulate
consumer buying and dealer
effectiveness.

GOAL is to enhance and speed up the


effectiveness of the other three.

SALES PROMOTION TOOLS


Free
Free samples
samples
Contests
Contests
Premiums
Premiums
Trade
Trade Shows
Shows

Popular
Popular Tools
Tools
for
for
Consumer
Consumer Sales
Sales
Promotion
Promotion

Vacation
Vacation Giveaways
Giveaways
Coupons
Coupons

DIRECT MARKETING

direct communication
with consumers
to generate a response in the
form of an order,
a request for further information,
or a visit to a retail outlet.

DIRECT MARKETING
The Growth of Direct Marketing
The Value of Direct Marketing
Direct Orders
Lead Generation
Traffic Generation

Technological, Global, and


Ethical Issues in Direct Marketing
Slide 18-55

FIGURE 18-9 Direct marketing expenditures, sales, and


employment by medium

Slide 18-56

PUBLIC RELATIONS/ PUBLICITY


The marketing function that
evaluates public attitudes, identifies
areas within the organization that the
public may be interested in, and
executes a program of action to earn
public understanding and acceptance.

PUBLICITY
PUBLIC RELATIONS

Creating demand
for a business or
product by placing
news about it in
the media

Internet/Interactive Marketing
The internet is the ultimate direct marketing medium and fastest growing advertising medium. While
internet remains the most powerful digital media other interactive media also allow for active
participation from or interactivity with the recipient.
In other words , Interactive media allow two way communication b/w organisation and its audiences. E.g.
mobile telephony, Computer games, Kiosk based terminals, Interactive television, Electronic storage
media, etc.

Ways the Internet Can Be Used as a Source of


Publicity

Tae-Bo has really changed my life. Ive lost weight, toned-up,


and feel better than ever.
-Susie Wells, CA

A company web site can be used to obtain and display positive feedback.

Ways the Internet Can Be Used as a Source of


Publicity
OnlineNews.com
Car shopping on the web
Buying a car on the web just got easier!
Autobytel.com will help you get the financing, pick
out the model, color and extras. Then they provide a
quote from a local dealer. All at the touch of a keypad.

A businesss goods, services, or web site might be mentioned in an Internet newsgroup.

PERSONAL SELLING
The PERSONAL presentation of a product or
company to one or more potential buyers

PERSONAL SELLING

the two-way flow of communication between


a buyer and seller, often in face-to-face
encounter, designed to influence a persons
or groups purchase decision or groups
purchase decision.

INTEGRATED MARKETING COMMUNICATIONS

IMC

A method of carefully coordinating


all promotional activities to
produce a consistent, unified
message that is customer focused.

I can send it out, but how do I know what was received ?

THE COMMUNICATION PROCESS


The process by which we exchange or share
meanings through a common set of symbols.
Noise
Noise

Source
Source

Encoding
Encoding
Message
Message

Message
Message
Channel
Channel

Feedback
Feedback
Channel
Channel

Decoding
Decoding
Message
Message

Receiver
Receiver

Criteria for Selecting Media


Communication
CommunicationMode
Mode
Communication
CommunicationControl
Control
Feedback
FeedbackAmount
Amount
Feedback
FeedbackSpeed
Speed
Message
MessageFlow
FlowDirection
Direction
Message
MessageContent
ContentControl
Control
Sponsor
SponsorIdentification
Identification
Reaching
ReachingLarge
LargeAudience
Audience
Message
MessageFlexibility
Flexibility

The promotional mix

FIGURE 18-A Factors that influence the use of promotional


tools

Slide 18-23

INTEGRATED MARKETING COMMUNICATIONS


DEVELOPING THE PROMOTIONAL MIX
The Target Audience

Slide 18-24

INTEGRATED MARKETING COMMUNICATIONS


DEVELOPING THE PROMOTIONAL MIX
The Product Life Cycle
Introduction Stage
Growth Stage
Maturity Stage
Decline Stage

Slide 18-27

FIGURE 18-3 Promotional tools used over the product life


cycle of Purina Dog Chow

Slide 18-28

INTEGRATED MARKETING COMMUNICATIONS


DEVELOPING THE PROMOTIONAL MIX
Product Characteristics
Complexity
Risk
Ancillary Services

Slide 18-30

INTEGRATED MARKETING COMMUNICATIONS


DEVELOPING THE PROMOTIONAL MIX
Stages of the Buying Process
Prepurchase Stage
Purchase Stage
Postpurchase Stage

Slide 18-32

FIGURE 18-4 How the importance of promotional elements


varies during the stages of consumers purchase decision

Slide 18-33

INTEGRATED MARKETING COMMUNICATIONS


DEVELOPING THE PROMOTIONAL MIX
Channel Strategies
Push Strategy
Pull Strategy
Direct-to-Consumer

Slide 18-34

FIGURE 18-5 A comparison of push and pull promotional


strategies

Slide 18-35

DEVELOPING AN IMC PROGRAM


Identifying the Target Audience
Specifying Promotion Objectives
Hierarchy of Effects
Awareness
Interest
Evaluation
Trial
Adoption
Slide 18-41

FIGURE 18-6 The promotion decision process

Slide 18-42

DEVELOPING AN IMC PROGRAM


Setting the Promotion Budget
Percentage of Sales Budgeting
Competitive Parity Budgeting (Matching
Competitors or Share of Market)
All-You-Can-Afford Budgeting
Objective and Task Budgeting

Slide 18-45

FIGURE 18-7 U.S. promotion expenditures by companies in


2003

Slide 18-46

FIGURE 18-8 The objective and task approach

Slide 18-47

DEVELOPING AN IMC PROGRAM


Selecting the Right Promotional Tools
Designing the Promotion
Scheduling the Promotion

Slide 18-48

ETHICS AND SOCIAL RESPONSIBILITY ALERT


How Do You Like Your E-Mail? Opt-out or Optin Are Your Choices

Slide 18-58

Corporate Plan (Corporate Objectives and


Strategies)
Marketing Plan( Marketing Objectives and
strategies)
Steps involved in the Marketing Plan
Situational Analysis
Set Marketing Objectives
Devise Marketing Strategies
Frame Implementation factor
Monitor and evaluate performance

IMC Plan
(IMC Objectives and strategies)

Situational Analysis
Determine a Problem or Opportunity
Determine the Communication Objectives
Determine the Budget
Develop IMC Strategies

Select Target Audience

Arrive at the Communication Mix

Design Message strategies

Determine Media strategies


Implement strategies and monitor activities
Evaluate the Planning Process

Reasons for Growing IMC Importance

Decreasing Impact of Traditional Advertising

Proliferation of new ways to reach Consumers

Demand for greater Accountability

Growth of Database Marketing

Growth of International Marketing

Emphasis on Relationship Marketing

Tighter Control over Communication

Changing Compensation structure of agencies

Need For a single Brand Custodian

Need for creating brand identity: Brand, Brand Recognition, Brand Identity, Brand
equity.

Benefits of IMC
IMC provides greater:

Brand Differentiation

Accountability with in a firm

Trust Among Consumers

Levels of effectiveness in cutting through message clutter than single


strategies

IMC wraps communications around customers and helps them move through
the various stages of the buying process.

This 'Relationship Marketing' cements a bond of loyalty with customers which


can protect them from the inevitable onslaught of competition.

IMC also increases profits through increased effectiveness. At its most basic level, a unified
message has more impact than a disjointed myriad of messages.

IMC can boost sales by stretching messages across several communications tools to create more
avenues for customers to become aware, aroused, and ultimately, to make a purchase.

Carefully linked messages also help buyers by giving timely reminders, updated information and
special offers which, when presented in a planned sequence, help them move comfortably
through the stages of their buying process.

IMC also makes messages more consistent and therefore more credible. This reduces risk in the
mind of the buyer which, in turn, shortens the search process and helps to dictate the outcome
of brand comparisons.

Barriers to the adoption of IMC

Top Management Support (lack of).

Accurate Metrics (lack of).

Manpower (lack of).

Changes needed in the organization

Theoretical and practical foundations (lack of).