Transcript Marketing: Managing Profitable Customer Relationships

Integrated Marketing
Communications Strategy
Chapter 14
1
Definition

Marketing communications
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The means by which firms attempt to inform,
persuade, and remind consumers, directly or
indirectly, about the products and brands they
sell.
Marketing Communications Mix
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The specific mix of advertising, personal
selling, sales promotion, and public relations a
company uses to pursue its advertising and
marketing objectives.
Goal 1: Know the tools of the marketing communications mix
Integrated marketing communications
Carefully blended mix of promotion tools
Advertising
Personal
selling
Sales
promotion
Public
relations
Direct
marketing
Consistent,clear,and
compelling company
and product
Messages.
Two Factors
are Changing the Face of Today’s
Marketing Communications:
Improvements in
Information Technology
Has Led to
Segmented Marketing
More Narrowcasting
Media Fragmentation
Marketers Have Shifted
Away From Mass
Marketing
Less Broadcasting
Market Fragmentation Led to
The Changing Communications Environment
Integrated Marketing
Communications
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Integrated Marketing Communications
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The concept under which a company carefully
integrates and coordinates its many
communications channels to deliver a clear,
consistent, and compelling message about the
organization and its products.
Goal 1: Know the tools of the marketing communications mix
Integrated Marketing
Communications
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The Need for Integrated Marketing
Communications
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Conflicting messages from different sources or
promotional approaches can confuse company
or brand images
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The problem is particularly prevalent when
functional specialists handle individual forms of
marketing communications independently
Goal 1: Know the tools of the marketing communications mix
Promotional Mix
Any paid form of nonpersonal presentation and promotion of ideas, goods
or services by an identified sponsor.
Promotion Tools
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Advertising
Personal Selling
Sales Promotion
Public Relations
Direct Marketing
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Reaches large, geographically
dispersed audiences, often with
high frequency
Low cost per exposure, though
overall costs are high
Consumers perceive advertised
goods as more legitimate
Dramatizes company/brand
Builds brand image; may
stimulate short-term sales
Impersonal; one-way
communication
Goal 4: Understand methods for setting budgets and designing the mix
Promotional Mix
Personal presentation by the firm’s sales force for the perpose of making
sales and building customer relationship.
 Most effective tool for
building buyers’ preferences,
convictions, and actions
 Personal interaction allows
for feedback and
 Advertising
adjustments
 Relationship oriented
 Personal Selling
 Buyers are more attentive
 Sales Promotion
 Sales force represents a
 Public Relations
long-term commitment
 Direct Marketing
 Most expensive of the
promotional tools
Promotion Tools
Goal 4: Understand methods for setting budgets and designing the mix
Promotional Mix
Short-term incentives to encourage the purchase or sale of a product or service.
Promotion Tools
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Advertising
Personal Selling
Sales Promotion
Public Relations
Direct Marketing
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Makes use of a variety of
formats: premiums,
coupons, contests, etc.
Attracts attention, offers
strong purchase
incentives, dramatizes
offers, boosts sagging
sales
Stimulates quick response
Short lived
Not effective at building
long-term brand
preferences
Goal 4: Understand methods for setting budgets and designing the mix
Promotional Mix
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 rumor stories and events.
Promotion Tools
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Advertising
Personal Selling
Sales Promotion
Public Relations
Direct Marketing
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Highly credible
Many forms: news stories, news
features, events and
sponsorships, etc.
Reaches many prospects missed
via other forms of promotion
Dramatizes company or benefits
Often the most underused
element in the promotional mix
Goal 4: Understand methods for setting budgets and designing the mix
Promotional Mix
Direct connections with carefully targeted individual consumers to both
obtain an immediate response and cultivate lasting consumer relationships.
Promotion Tools
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Advertising
Personal Selling
Sales Promotion
Public Relations
Direct Marketing
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Many forms: Telephone
marketing, direct mail, online
marketing, etc.
Four distinctive characteristics:
 Nonpublic
 Immediate
 Customized
 Interactive
Well-suited to highly targeted
marketing efforts
Goal 4: Understand methods for setting budgets and designing the mix
Communication Platforms
Advertising
 Print and broadcast ads
 Packaging inserts
 Motion pictures
 Brochures and booklets
 Posters
 Billboards
 POP displays
 Logos
 Videotapes
Sales Promotion
 Contests, games,
sweepstakes
 Premiums
 Sampling
 Trade shows, exhibits
 Coupons
 Rebates
 Entertainment
 Continuity programs
Communication Platforms
Personal Selling
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Sales presentations
Sales meetings
Incentive programs
Samples
Fairs and trade shows
Public Relations
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Press kits
Speeches
Seminars
Annual reports
Charitable donations
Publications
Community relations
Lobbying
Identity media
Company magazine
Communication Platforms
Direct Marketing
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Catalogs
Mailings
Telemarketing
Electronic shopping
TV shopping
Fax mail
E-mail
Voice mail
Blogs
Websites
The promotional mix
Slide 18-15
Factors that influence the use of
promotional tools
Slide 18-23
INTEGRATED MARKETING
COMMUNICATIONS—DEVELOPING THE
PROMOTIONAL MIX
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Stages of the Buying Process
 Prepurchase Stage
 Purchase Stage
 Postpurchase Stage
Slide 18-32
How the importance of promotional
elements varies during the stages of
consumer’s purchase decision
Slide 18-33
Elements in the Communication Process
Steps in Developing Effective
Communication
Identifying the Target Audience
Determining the communication
objectives
Designing a Message
Choosing Media
Selecting the Message Source
Collecting Feedback
Developing Effective
Communication
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Step 1: Identifying the Target Audience
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Affects decisions related to what, how, when,
and where message will be said,
as well as who will say it
Step 2: Determining Communication
Objectives
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Six Buyer readiness stages
Awareness
Knowledge
Liking
Preference
Conviction
Purchase
Goal 3: Learn the steps in developing effective marketing communications
Designing a message
Message content
What to say?
Message structure
& Message format
How to say?
Developing Effective
Communication
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Step 3: Designing a Message
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AIDA framework guides message design
Message content contains appeals or themes
designed to produce desired results
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Rational appeals
Emotional appeals
 Love, pride, joy, humor, fear, guilt, shame
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Moral appeals
Goal 3: Learn the steps in developing effective marketing communications
Developing Effective
Communication
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Step 3: Designing a Message
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Message Structure: Key decisions are required
with respect to three message structure
issues:
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Whether or not to draw a conclusion
One-sided vs. two-sided argument
Order of argument presentation
Message Format: Design, layout, copy, color,
shape, movement, words, sounds, voice, body
language, dress, etc.
Goal 3: Learn the steps in developing effective marketing communications
Choosing Media
Personal
communication
channel
Word-of-mouth
influence
Non-personal
communication
channel
Developing Effective
Communication
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Step 4: Choosing Media
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Personal communication channels
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Includes face-to-face, phone, mail, and Internet
chat communications
Word-of-mouth influence is often critical
Nonpersonal communication channels
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Includes media, atmosphere, and events
Goal 3: Learn the steps in developing effective marketing communications
Developing Effective
Communication
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Step 5: Selecting the Message Source
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Highly credible sources are more persuasive
A poor spokesperson can tarnish a brand
Step 6: Collecting Feedback
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Recognition, recall, and behavioral measures
are assessed
May suggest changes in product/promotion
Goal 3: Learn the steps in developing effective marketing communications
Setting the Promotional Budget
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Setting the Total Promotional Budget
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Affordability Method
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Percentage-of-Sales Method
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Budget is set at a level that a company can afford
Past or forecasted sales may be used
Competitive-Parity Method
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Budget matches competitors’ outlays
Goal 4: Understand methods for setting budgets and designing the mix
Setting the Promotional Budget
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Setting the Total Promotional Budget
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Objective-and-Task Method
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Specific objectives are defined
Tasks required to achieve objectives are
determined
Costs of performing tasks are estimated, then
summed to create the promotional budget
Goal 4: Understand methods for setting budgets and designing the mix
The objective and task approach
Slide 18-47
Setting the Promotional Mix
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Setting the Overall Promotion Mix
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Determined by the nature of each promotion
tool and the selected
promotion mix strategy
Goal 4: Understand methods for setting budgets and designing the mix
US Measured
Advertising
Spending by
Media
Slide 18-46
Setting the Promotional Budget and
Mix
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Promotion Mix Strategies
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Push strategy: trade promotions and personal
selling efforts push the product through the
distribution channels.
Pull strategy: producers use advertising and
consumer sales promotions to generate strong
consumer demand for products.
Goal 4: Understand methods for setting budgets and designing the mix
Push versus pull promotion strategy
Producer
marketing
activities
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Producer
Retailer &
wholesalers
Reseller
marketing
activities
Consumers
Push strategy
Demand
Producer
Demand
Retailer &
wholesalers
Producer marketing activities
Real Marketing 14.2
Pull strategy
Consumers
Socially Responsible
Communications
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Personal Selling
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Salespeople must follow the rules of “fair
competition”
Three-day cooling-off rule protects ultimate
consumers from high pressure tactics
Business-to-business selling
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Bribery, industrial espionage, and making false and
disparaging statements about a competitor are
forbidden
Goal 4: Understand methods for setting budgets and designing the mix
Advertising, Personal selling.
Public relations & Sales
Promotions
Chapter 15 & 16
Definition
 Advertising

Any paid form of nonpersonal
presentation and promotion of
ideas, goods, or services by an
identified sponsor.
Major Advertising Decisions
Message Decisions
•Message Strategy
•Message Execution
Objectives
Setting
•Communication
objectives
•Sales Objectives
Budget Decisions
•Affordable Approach
•Percent of sales
•Competitive parity
•Objective and task
Campaign Evaluation
•Communication Impact
•Sales Impact
Media Decisions
•Reach, Frequency, Impact
•Major Media Types
•Specific Media Types
•Media Timing
Four important decisions in
developing advertising program
Setting advertising objectives
 Setting the advertising budget
 Developing the advertising strategy
 Evaluating advertising campaigns
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Setting Advertising Objectives
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Advertising objectives can be classified by primary purpose:
 Inform
 Introducing new products, suggesting new uses,
informing price change etc.
 Persuade
 Becomes more important as competition increases [Sony
offers best quality]
 Comparative advertising [We’re number two, so we try
harder]
 Remind
 Most important for mature products [Coca-Cola]
 Reminding customers where to buy it
Informing
Setting the advertising budget
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Several factors should be considered when setting the ad
budget:
 Stage in the PLC: New products, big ad budget to aware
and persuade; mature brands - low
 Market share: building the market or taking market
share requires large ad budget.
 Level of competition: many competitors - large
 Ad clutter: high - large
 Degree of brand differentiation: undifferentiated brand –
heavy ad budget
Developing advertising strategy
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Two major elements:
 Creating ad messages
 Selecting ad media
Creating ad messages: increase number of TV channels,
average ad expose numbers, remote control etc.
 Message strategy: what general message to be
communicated?
 Advertising appeal: Three characteristics: appeals
must be
 Meaningful: pointing out benefits
 Believable: deliver promised benefits
 Distinctive: how better than the competing brands?
Developing advertising strategy
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Message execution: Turn big idea into actual ad
execution that will capture target market’s attention
and interest. Creative people must find the best style,
tone, words, and format for executing the message.
 Many execution styles: slice of life, musical,
personality symbol, scientific evidence.
 Tone: +ve or –ve tone
 Words: “Buy cheap socks and you’ll pay through
the toes” Hanes Socks.
 Format: Illustration, headline, copy
Developing advertising strategy
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Select advertising media: Major steps in media selection are
 Decide on level of reach, frequency and impact:
 Choose among the major media types by considering:
 Target consumer media habits, nature of the product:
fashion are best advertised in color magazines, auto
performance on TV
 Types of messages: major sale – news paper, lots of
technical data - magazine, and
 Costs: the cost of reaching 1,000 people using the
media.
 Select specific media vehicles: specific media within each
general media type. nTV, ATN Bangla; Ittefaq, Times, Daily
Star, Independence.
 Decide on media timing: Hallmark – occasions, Even
continuity or uneven Pulsing.
Advertising
Major Media Types
Newspapers
 Television
 Direct Mail
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Radio
 Magazines
 Outdoor
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Internet
Evaluating Advertising
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Measuring communications effects
 Is the intended message being communicated
effectively and to the intended audience?
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Measuring sales effect
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Has the campaign generated the intended sales growth?
(much more difficult to measure)
Definition
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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
unfavorable rumors, stories, and events.
Major functions of public relations
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Press Relations or Agency - creating and placing
newsworthy information in the media
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Product Publicity - publicizing specific products
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Public Affairs - building and maintaining national or local
community relations (e.g. sponsoring concerts)
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Lobbying - building and maintaining relations with
legislators and government officials
Major functions of public relations
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Investor Relations - maintaining relationships with
shareholders and others in the financial community
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Development - maintaining relationships with donors or
members of not-for-profit organizations
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Crisis Management - helping a company in the media
spotlight because of a problem with product, employees, or
business
Definition
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Personal selling
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Personal representation by the firm’s sales force for the
purpose of making sales and building customer
relationship
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One of the oldest professions in the world
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Today, most salespeople are well-educated, well-trained
professionals who work to build and maintain long-term
relationships with customers.
The Role of the Sales Force
Represent the Company
to Customers to Produce
Company Profit
Sales Force
Serves as a Critical Link
Between a Company and its Customers Since They:
Represent Customers to
the Company to Produce
Customer Satisfaction
Major Steps in Effective Selling
Prospecting and Qualifying
Preapproach
Approach
Presentation and Demonstration
Handling objections
Closing
Follow-up
Steps in the Selling Process
Prospecting
Salesperson Identifies Qualified Potential
Customers.
Qualifying
Process of Identifying Good Prospects
and Screening Out Poor Ones.
Preapproach
Salesperson Learns as Much as Possible
About a Prospective Customer and About
his/her Offer Before Making a Sales Call.
Approach
Salesperson Meets the Buyer For the First
Time.
Steps in the Selling Process
Presentation and
Demonstration
Salesperson Tells the Product “Story” to the
Buyer Using the Need-Satisfaction Approach.
Dislike: pushy, late, deceitful, unprepared, disorganized
Value most: good listening, thorough, honesty, dependability,
empathy, respect
Handling
Objections
Salesperson Seeks Out, Clarifies, and
Overcomes Customer Objections to Buying.
Closing
Salesperson Asks the Customer for an Order.
Follow-Up
Occurs After the Sale and Ensures Customer
Satisfaction and Repeat Business.
Sales force structure
Territorial sales
force structure
Sales force
structure
Product sales
force structure
Customer sales
force structure
Definition
 Sales
Promotion
Short-term incentives to encourage
the purchase or sale of a product or
service.
 Can be targeted at final buyers,
retailers and wholesalers, business
customers, and the sales force.
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Consumer Promotion Tools
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Samples: Lifebuoy mini pack shampoo.
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Coupon: certificates, save $10 when you
purchase with certificates
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Cash Refunds (Rebates): Dell, mailing rebates
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Price packs (cents-off deals): reduced price
marked on the label or package. “two for the
price of one”
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Contests: suggestions, filling up essay, Games
etc.
Consumer Promotion Tools
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Advertising Specialties: articles imprinted with
advertiser’s name. pens, calendars, key rings,
matches, T shirts, caps, coffee mugs.
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Premiums: goods offered either free or at low
cost. (Gold or silver)
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Patronage Rewards: frequent flier-programs
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Point-of-Purchase Communications: Display at
pop. Big Lipstick, Burger picture.