Marketing An Introduction Second Canadian Edition Armstrong Kotler

Marketing: An Introduction Second Canadian Edition Armstrong, Kotler, Cunningham, Mitchell and Buchwitz Chapter Twelve Integrated Marketing Communications 1 Copyright © 2007 Pearson Education Canada

Looking Ahead • Explain why it is important for organizations to integrate their marketing communications. • Describe and discuss the major decisions involved in developing an advertising program. • List the major marketing communications goals achieved through sales promotions. • List and describe the steps in the personal selling process. • Discuss the major forms of direct response marketing. • Explain how companies use public relations to communicate with their publics. 2 Copyright © 2007 Pearson Education Canada

Marketing Communications Mix • Advertising. – Any paid form of non-personal presentation and promotion of ideas, goods or services by an identified sponsor. • Sales Promotion. – Short-term incentives to encourage the purchase or sale of a product or service. 3 Copyright © 2007 Pearson Education Canada

Marketing Communications Mix • Public relations. – Building good relations with the company’s various publics by obtaining favorable publicity, building up a good corporate image and handling or heading off unfavourable rumors, stories and events. • Personal selling. – Personal presentation by the firm’s sales force for the purpose of making sales and building customer relationships. 4 Copyright © 2007 Pearson Education Canada

Marketing Communication Mix • Direct Marketing. – Direct connections with carefully targeted individual consumers to both obtain an immediate response and cultivate lasting customer relationships—the use of telephone, mail, fax, e-mail, the Internet and other tools to communicate directly with specific consumers. 5 Copyright © 2007 Pearson Education Canada

The Changing Environment • Two factors are changing the face of today’s marketing communications: – Vast improvements in information technology are speeding the movement toward segmented marketing – As mass markets have fragmented, marketers are shifting away from mass marketing. 6 Copyright © 2007 Pearson Education Canada

Integrated Communications • Response to fragmented mass markets and new technologies. • Allows promotions to be more targeted. • Integrated means “fits together. ” – Message is consistent across all channels. – Generate leverage through repetition and multiple sources with the same message. • Promotional mix must be coordinated with other marketing mix elements. 7 Copyright © 2007 Pearson Education Canada

The Need for IMC • Using IMC, the company carefully integrates and coordinates its many communication channels to deliver a clear, consistent and compelling message about the organization and its brands. 8 Copyright © 2007 Pearson Education Canada

Marketing Agencies • Nature of marketing agencies is changing. • Past habit was to have different agencies. working on different promotional elements. – Result was more ineffective than an IMC approach. • Today’s agencies are striving to provide IMC strategies and services. 9 Copyright © 2007 Pearson Education Canada

IMC Process • Managing the customer relationship over time. – Start with audit. – Assess the influence of each promotional tool on the target market at each stage of the buying process. – Blend all elements into an integrated mix. – Take into consideration product, distribution and price. 10 Copyright © 2007 Pearson Education Canada

Promotional Strategies • Push strategy: – Promotional effort to channel members to stock, promote products to consumers. – Personal selling and trade promotion-driven. • Pull strategy: – Promotional effort to appeal directly to consumers. – Advertising and sales promotion-driven. 11 Copyright © 2007 Pearson Education Canada

Setting the Advertising Budget • Affordable. – Based on what the company thinks it can afford. • Percentage-of-sales. – Based on a percentage of current or forecasted sales. • Competitive-parity. – Set budget to match competitors. • Objective-and-task. – Set objectives, determine tasks to achieve objectives, sum of task costs equals budget. 12 Copyright © 2007 Pearson Education Canada

Advertising • Reach large masses of geographically dispersed. • Allows for repetition and targeting of audience. • Builds awareness, image, positioning. • Provides wide artistic possibilities. • Can be expensive, impersonal, one-way. • Media fragmentation makes finding large audience difficult. 13 Copyright © 2007 Pearson Education Canada

Setting Advertising Objectives • An advertising objective is a specific communication task to be accomplished with a specific target audience during a specific period of time. • Classified by purpose: – Inform. – Persuade. – Compare. – Remind. 14 Copyright © 2007 Pearson Education Canada

Developing Advertising Strategy • Whether advertising should be an element in an IMC campaign. • If yes, then strategy consists of two major elements: – Creating advertising messages. – Selecting advertising media. 15 Copyright © 2007 Pearson Education Canada

The Message Strategy • Need a good message to communicate. • Break through advertising clutter. • Media proliferation has made attracting attention very difficult for advertisers. • Identify customer benefits related to product’s positioning. • Need a creative concept, or “big idea” to express that message. 16 Copyright © 2007 Pearson Education Canada

Message Execution • Typical approaches: – Slice of life. – Lifestyle. – Fantasy. – Mood or image. – Musical. – Personality symbol. 17 – Technical expertise. – Scientific evidence. – Testimonial evidence or endorsement. Copyright © 2007 Pearson Education Canada

Selecting Advertising Media • Reach. – Percentage of people exposed to ad. • Frequency. – Number of times a person is exposed to ad. • Media impact. – The qualitative value of a message exposure through a given medium. 18 Copyright © 2007 Pearson Education Canada

Choosing Media Type • Newspapers, magazines, television, radio, outdoors, direct mail, online. • Factors to consider: – – Media habits of target consumers. Nature of the product. Type of message. Cost. • Media vehicles-- specific media within each general media type. • Media timing – schedules, seasons, patterns. 19 Copyright © 2007 Pearson Education Canada

Evaluating Advertising • Ultimate test is whether sales have increased. • Measure before and after an ad campaign to measure results. • Online advertising the easiest to measure based on conversion rates and the ability to prompt immediate calls to action. 20 Copyright © 2007 Pearson Education Canada

International Advertising • Think globally, but act locally. • Consider language, cultural differences. • Media costs and availability can vary. 21 Copyright © 2007 Pearson Education Canada

Sales Promotion • • • Coupons, contests, premiums, incentives. Used to attract attention. Provide incentive for trial or purchase. Generates results now versus later. Effectiveness easier to track than advertising. • May detract from brand equity and loyalty. 22 Copyright © 2007 Pearson Education Canada

Sales Promotion Objectives • Consumer: increase short-term sales or help build long-term market share. • Trade: get retailers to: – carry new items and more inventory. – advertise products. – give products more shelf space. – buy ahead. 23 Copyright © 2007 Pearson Education Canada

Personal Selling • Personal, flexible, two-way communication, provides direct feedback. • Builds preference, conviction, action. • Suited to complex, higher priced products. • Basis for building a buyer relationship. • Most expensive on a per contact basis. • Requires long-term commitment and ongoing management. 24 Copyright © 2007 Pearson Education Canada

Sales Force Organization • Territorial – each person is assigned a geographic territory. • Product – salespeople specialize in selling a particular product. • Customer – salespeople specialize in selling to particular types of customers. • Outside – salespeople work in the field. • Inside – salespeople sell via phone or email. 25 Copyright © 2007 Pearson Education Canada

The Personal Selling Process • Prospecting. – Identify qualified potential customers. • Pre-approach. – Learn as much as possible about customer first. • Approach. – Meet the customer for the first time. • Presentation. – Tell the “product story” to the buyer, highlighting customer benefits. 26 Copyright © 2007 Pearson Education Canada

The Personal Selling Process • Handling objections. – Seek out, clarify and overcome customer objections to buying. • Closing. – The salesperson asks the customer for an order. • Follow-up. – The salesperson follows up after the sale to ensure customer satisfaction and repeat business. 27 Copyright © 2007 Pearson Education Canada

Direct Response • Direct connections with carefully targeted individual consumers. • Immediate and interactive. • Cultivate lasting customer relationships. • Can supplement to existing channels. • Fastest growing form of marketing. • Low-cost and efficient. 28 Copyright © 2007 Pearson Education Canada

Database Marketing • An organized collection of comprehensive data about individual customers or prospects, including geographic, demographic, psychographic and behavioural data. • Allows marketing messages to be finetuned to specific groups of people. 29 Copyright © 2007 Pearson Education Canada

Telemarketing • Using the telephone to connect directly. • Used in both consumer and B 2 B markets. • Can be outbound or inbound calls. • Used for both sales and customer service. 30 Copyright © 2007 Pearson Education Canada

Direct Mail Marketing • Involves sending an offer, announcement, reminder or other item to a person at a particular address. • Permits high target-market selectivity. • Personal and flexible. • Easy to measure results. 31 Copyright © 2007 Pearson Education Canada

Catalogue Marketing • Direct marketing through print, video or electronic catalogues that are mailed directly. • With the Internet, more and more catalogues going electronic. • Print catalogues still the primary medium. • Harder to attract new customers with Internet catalogues. 32 Copyright © 2007 Pearson Education Canada

Direct-Response TV Marketing • Television spots that persuasively describe a product and give customers a toll-free number for ordering. – Infomercials. – The Shopping Channel. – Kiosks. 33 Copyright © 2007 Pearson Education Canada

Public Policy and Ethics • Key issues include: – Misleading consumers including deception and fraud. – Taking advantage of impulse buyers, those addicted to TV and unsophisticated buyers. – Privacy and protection of personal information. – Invasion of privacy at home and the “do not call” registry. 34 Copyright © 2007 Pearson Education Canada

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 unfavourable rumors, stories and events. 35 Copyright © 2007 Pearson Education Canada

Public Relations • News stories, features, press conferences, annual reports, corporate website. • Seen as more believable than advertising messages. • More cost efficient. • Can be difficult to control. • Can be proactive and reactive. 36 Copyright © 2007 Pearson Education Canada

Public Relations Functions • Press relations – get attention of media. • Product publicity – publicizing new products. • Public affairs – manage national or local community relations. • Lobbying – manage relations with legislators and officials. 37 Copyright © 2007 Pearson Education Canada

Public Relations Functions • Investor relations – manage relations with shareholders and financial community. • Development – fund raising for nonprofits. • Crisis management – manage reaction to sudden, bad publicity through problems with products, employees or the company. 38 Copyright © 2007 Pearson Education Canada

Public Relations Tools • • • News. • Audiovisual materials. Speeches. • Corporate identity Special events. materials. Buzz marketing. • Public service Mobile marketing. activities. Written materials. • Company website. 39 Copyright © 2007 Pearson Education Canada

Looking Back • Explain why it is important for organizations to integrate their marketing communications. • Describe and discuss the major decisions involved in developing an advertising program. • List the major marketing communications goals achieved through sales promotions. • List and describe the steps in the personal selling process. • Discuss the major forms of direct response marketing. • Explain how companies use public relations to communicate with their publics. 40 Copyright © 2007 Pearson Education Canada