Chapter 13 Integrated Marketing Communications Advertising Sales Promotion

Chapter 13 Integrated Marketing Communications: Advertising, Sales Promotion, and Public Relations

Road Map: Previewing the Concepts Discuss the process and advantages of integrated marketing communication. Define the five promotion tools and discuss the factors that must be considered in shaping the overall promotion mix. Describe and discuss the major decisions involved in developing an advertising program. Explain how sales promotion campaigns are developed and implemented. Explain how companies use public relations to communicate with their publics. 13 -2

American Standard Your mission – prepare a promotion campaign for American Standard’s line of toilets. Campaign materials – media ads, direct mailing, and personal contacts – to build sales and market share. 13 -3

Marketing Communication Mix or Promotion Mix Product’s Design Product’s Price Stores that Sell the Product’s Package 13 -4

Marketers Have Shifted Away From Mass Marketing Less Broadcasting 2 Factors are Changing the Face of Today’s Marketing Communications: Improvement in Information Technology Has Led to Segmented Marketing More Narrowcasting Market Fragmentation Led to Media Fragmentation The Changing Communications Environment 13 -5

The Need for Integrated Marketing Communications With Integrated Marketing Communications (IMC), the Company Carefully Integrates and Coordinates Its Many Communications Channels to Deliver a Clear, Consistent, and Compelling Message About the Organization and Its Products. 13 -6

Integrated Marketing Communications (Fig. 13 -1) 13 -7

Setting the Overall Communication Mix Advertising Personal Selling Sales Promotion Public Relations Direct Marketing Reaches Many Buyers, Repeats Message Many Times, Impersonal, Expensive Personal Interaction, Relationship Building, Most Expensive Promo Tool Wide Assortment of Tools, Rewards Quick Response, Efforts Short-Lived Very Believable, Dramatize a Company or Product, Underutilized Nonpublic, Immediate, Customized, Interactive 13 -8

Push versus Pull Promotion Strategy (Fig. 13 -2) 13 -9

Advertising is centuries old. U. S. advertisers spend in excess of $244 billion each year; worldwide spending exceeds $465 billion. Advertising is used by: Business firms, Nonprofit organizations, Professionals, and Social agencies. 13 -10

Major Decisions in Advertising (Fig. 13 -3) 13 -11

Setting Advertising Objectives Persuasive Advertising Informative Advertising Build Selective Demand Inform Consumers or i. e Sony DVD Players Build Primary Demand i. e DVD Players Advertising Objective Specific Communication Task Accomplished with a Specific Target Audience During a Specific Period of Time Comparative Advertising Reminder Advertising Keeps Consumers Compares One Brand Thinking About a Product to Another i. e. Coca-Cola i. e. Avis vs. Hertz 13 -12

Advertising objectives can be classified by primary purpose: to inform, persuade, or remind. Think of examples of ads that address each of these objectives. Using Table 13 -1, discuss why your examples fit the chosen objective. 13 -13

Setting the Advertising Budget Methods of Setting the Advertising Budget for Each Product and Market. Affordable Based on What the Company Can Afford Percentage-of-Sales Based on a Certain Percentage of Current or Forecasted Sales Objective-and-Task Competitive-Parity Based on Determining Based on the Competitors’ Objectives & Tasks, Promotion Budget Then Estimating Costs 13 -14

Developing Advertising Strategy Consists of Two Major Elements and Companies are Realizing the Benefits of Planning These Two Elements Jointly. Creating the Advertising Selecting the Advertising Media Messages 13 -15

Creating the Advertising Message: Message Strategy Develop a Message Focus on Customer Benefits Creative Concept “Big Idea” Visualization or Phrase Advertising Appeals Meaningful, Believable & Distinctive 13 -16

Developing Advertising Strategy: Message Execution Testimonial Evidence Scientific Evidence Technical Expertise Slice of Life Typical Message Execution Styles Personality Symbol Lifestyle Fantasy Mood or Image Musical 13 -17

Advertising Strategy: Selecting Advertising Media Deciding on reach, frequency, and impact. Choosing among the major media types. Media habits of target customers, Nature of the product, Types and costs of messages. Selecting specific media vehicles. Specific media within each general media type. Deciding on media timing. Scheduling advertising over the course of a year. 13 -18

Evaluating Advertising Program Evaluation Communication Effects (Copy Testing) Is the Ad Communicating Well? Sales Effects Is the Ad Increasing Sales? 13 -19

Other Advertising Considerations Sales Departments in Small Companies Advertising Departments in Larger Companies Advertising Agency Firm that Assists Companies in the Planning, Creation, & Implementation of Their Advertising Programs 13 -20

What is Sales Promotion? Sales Promotion Offers Short-Term Incentives to Encourage Purchase or Sales of a Product or Service. Offers Reasons to Buy NOW. 13 -21

Rapid Growth of Sales Promotion Sales promotion can take the form of consumer promotions, business promotions, trade promotions, or sales force promotions. Rapid growth in the industry has been achieved because: Product managers are facing more pressure to increase their current sales, Companies face more competition, Advertising efficiency has declined, Consumers have become more deal oriented. 13 -22

Sales Promotion Objectives Consumer Promotions: increase short-term sales or help build long-term market share. Trade Promotions: get retailers to: carry new items and more inventory, advertise products, give products more shelf space, and buy product ahead. Sales Force: getting more sales support. In general, sales promotion should focus on consumer relationship building. 13 -23

Major Consumer Sales Promotion Tools Sample Trial amount of a product Coupons Savings when purchasing specified products Cash Refunds Refund of part of the purchase price Packs Premiums Advertising Specialties Reduced prices marked on the label or package Goods offered free or low cost as an incentive to buy a product Articles imprinted with an advertiser’s name given as gifts 13 -24

Major Consumer Sales Promotion Tools Patronage Rewards Point-of-Purchase Contest Sweepstakes Games Cash or Other Award Offered for Regular Use of a Product Displays or Demonstrations at the Point of Purchase Consumers Submit an Entry to be Judged Consumers Submit Their Names for a Drawing Consumers Receive Something Each Time They Buy Which May Help Them Win a Prize 13 -25

Which of the sales promotion tools described in the chapter would be best for stimulating sales of the following products or services? Gummy Bears new Black Cherry flavor, Proctor & Gamble’s efforts to bundle laundry detergent and fabric softener together in a combined marketing effort, Outpost. com attempts to help consumers remember what it sells as well as its Web address. 13 -26

Major Trade Sales Promotion Tools Trade-Promotion Objectives Trade-Promotion Tools Persuade Retailers or Wholesalers to Carry a Brand Discounts Give a Brand Shelf Space Allowances Promote a Brand in Advertising Free Goods Push a Brand to Consumers Push Money Specialty Ad Items 13 -27

Major Business Sales Promotion Tools Business-Promotion Objectives Business-Promotion Tools Generate Business Leads Conventions Stimulate Purchases Trade Shows Reward Customers Sales Contests Motivate Salespeople 13 -28

Developing the Sales Promotion Program Decide on the Size of the Incentive Set Conditions for Participation Determine How to Promote and Distribute the Promotion Program Determine the Length of the Program Evaluate the Program 13 -29

What is Public Relations? Public Relations Involves Building Good Relations With the Company’s Various Publics by Obtaining Favorable Publicity, Building Up a Good Corporate Image, and Handling or Heading Off Unfavorable Rumors, Stories, and Events. 13 -30

Major Public Relations Functions Press Relations or Agentry Product Publicity Public Affairs Public Relations Departments May Perform Any or All of the Following Functions: Lobbying Investor Relations Development 13 -31

Major Public Relations Tools News Web Site Speeches Public Service Activities Special Events Corporate Identity Materials Audiovisual Materials Written Materials 13 -32

Rest Stop: Reviewing the Concepts Discuss the process and advantages of integrated marketing communication. Define the five promotion tools and discuss the factors that must be considered in shaping the overall promotion mix. Describe and discuss the major decisions involved in developing an advertising program. Explain how sales promotion campaigns are developed and implemented. Explain how companies use public relations to communicate with their publics. 13 -33