What is InternationalIntegrated MarketingCommunication and Advertising?
4 What are the components of the International Promotional Mix / Integrated Marketing Communications (IMC)? Advertising* Advertising*16-2 Sales Promotion Sales Promotion Trade Shows Trade Shows Personal Selling* Personal Selling* Direct Selling Direct Selling Public Relations Public Relations *Usually The Major Components
Advertising• Any paid message placed in a medium.• Nonpersonal communication by an identified sponsor across international borders, using broadcast, print, and/or interactive media
Consumer Sales Promotion • Sponsored communications to the target consumer or trade segment that stimulate purchases or improve relationships with middlemen • Examples: – Point-of-Sale Displays – Free Samples – Coupons – Gifts – Sweepstakes – Contests
Sales Promotion• Sales promotions could be a vital tool when introducing a product internationally. Sampling or couponing, among other promotion strategies, could be a great way to introduce the product to an international market. E.g. Worked for Tang, General Mills pre-sweetened orange juice mix, in Latin America.• One barrier to sales promotion is that it requires support from local retailers and distributors. Eg, grocery stores must be able to cash in coupons that its customers redeemed. This entails sending the coupons and paperwork to the accounting department of the company offering the promotion. This strategy did not work for A.C. Neilson in Chile. The Chilean supermarket union opposed the coupon incentive and the promotion failed.
International PublicityA communication about a companyand/or the company’s products thatthe company does not pay for.Can be negative or positive.
International Publicity Examples •Due to its independent nature, it isconsidered more credible than any other component of the promotional mix. •The company can influence publicitythrough public relations. •Publicity includes: – Print articles – Broadcast messages – Word-of-mouth communication about the company and/or its products – Internet increases publicity venues.
International Public RelationsA concerted effort on the part of a company togenerate good will among publics (community,government, consumers, employees, and amongothers) that are essential to the company.
International Public Relations Examples• News Releases/Letters/Company Publications: – Companies must regularly communicate with their publics. – When new products are introduced, companies should offer news releases, press releases, and/or company publications promoting the new product or service.• Event Sponsorship and Presence: – Growing venue for international marketing communications. – Important tool for shaping public opinion.
International Advertising Decisions1. Decide whether to standardize or adapt advertising.2. Develop the most effective message(s) for the market segments selected.3. Select effective media.4. Compose and secure a budget.
Is this exampleofStandardizedor AdaptedAdvertising?In Italy, whereJames Bond isconsidered toouptight, adsignored starand featured aconvict with theline: “Youbetter have agood reason tomiss the nextJames Bondfilm.”
Bruce Almighty in MalaysiaMotorists pass a billboard advertisinga billboard Jim Carrey’s latest movie“Bruce Almighty: along a highway inKuala Lumpur, Malaysia.Government censors havepostponed the Malaysian release ofthe movie pending a decision onwhether to ban it for trivializing thesubject of God.” AP Aug. 10, 2003
Standardize or adapt advertising?• Standardize? – Reduce costs – Accelerates product launches – Consumers preferences and product references may becoming more similar – Increases control, especially where local resources are questionable
Barriers To Standardization• Communication infrastructure• Agencies might not serve a particular market• Consumer literacy• Attitudes toward product country of origin• Differing culture, values and purchase motivations• Differing language• Legal restrictions and self-regulation
Message Standardize or Adapt?“Cavity reducing fluoride toothpaste sells well in the U.S. where healthy teeth care perceived as important, but has limited appeal in markets such as Great Britain and France where the reason for buying toothpaste is breath control.”
Message / Positioning: Standardize or Adapt?• Differing culture, values and purchase motivations affects advertising message – E.g. In Germany, bicycle is primary source of transportation; promote it as reliable, optimal performance regardless of weather – In U.S., primarily used for recreation, focus on weekend fun.
Language? Standardize or Adapt• Problems with translation, pronunciation• Idioms• Multiple languages in country
Misfires in Advertising• Phonetic Problems with Brand Names - Bardok (Sounds like Brothel in Russian) - Coca Cola (Sounds like bite the Wax Tadpole) - Misair (Sounds like Misery in French)• Translations• Intent Translation - Stepping Stone - Stumbling Block - Car Wash - Car Enema - Highly Rated - Over Rated• Symbols - Owl - Bad Luck in India• Other Countries make mistakes too - Zit (Chocolate from Germany) - Koff (Beer)
Using English In Local Advertisements• English: Requires less space in print and broadcasting time Conveys a cosmopolitan attitude Endows a product or service with status
Using English and U.S. Movie Stars in Local Advertisements• English: – Requires less space in print and broadcasting time. – Conveys a cosmopolitan attitude. – Endows a product or service with status.
Areas of Advertising Legislation• Mandatory Use of Language (Belgium, Canada, France, Mexico only).• Price Advertising• Sales• Prohibition of Misleading Advertising.• Comparative Advertising• Advertising Using Product Tests.• Environmental Claims• Protection of Children
Advertising Legislation Varies by country; examples: - France: Requirement to keep the French language pure - Islamic countries: Ban the use of sex in advertising - European Union Directive does not permit advertising that directly exhorts minors to buy a product; that directly encourages minors to persuade their parents to purchase the goods advertised, show minors in dangerous situations - European Union Directive prohibits television advertising for tobacco products and prescription drugs - European Union is attempting to harmonize broadcasting laws - The Italian government limits television advertising to 12 percent of airtime per hour and four percent over a week on state channels, and 18 percent per hour and 15 percent per week on commercial stations. In addition, the top Italian television stations do not guarantee that advertising shown on their stations will reach the target audience.
Comparative Advertising European Union Directive (Effective May, 2000)• Comparative Advertising will be allowed Provided: – It is not misleading; – It compares goods or services intended for the same purpose; – It objectively compares one or more material, relevant, verifiable and representative features of those goods or services; – It does not create confusion between the competitor and the advertiser; – It does not discredit the trade-marks, goods, services or business of the competitor; and – It does not take unfair advantage of the reputation of the competitor’s trade-mark.
Media Decisions• Certain media selections make sense for some countries but not for others.• For instance, Peru and Mexico see the highest percentage of advertising dollars spent on television advertising (84 percent and 73 percent, respectively) of any countries.• In Kuwait and Norway the vast majority of advertising dollars in their country spent on print media (91 percent and 77 percent, respectively).• Outdoor advertising plays entirely different roles in Bolivia (48 percent of advertising) and Germany (three percent of advertising).
Worldwide AdvertisingExpenditures by Medium (in billions U.S.$) Media North Europe Japan America Newspapers 44.02 28.50 7.88 Magazines 14.33 13.54 2.97 Television 52.69 25.15 13.41 Radio 17.89 3.89 1.33 Outdoor 4.34 4.57 3.71 Internet 4.88 0.75 0.59 Directories 13.77 3.41 1.24 Direct mail 46.07 15.89 2.77 Sources: “Global Adspend Trends: Global TV Advertising,” International Journal of Advertising, Vol. 22, No. 4, 2003, pp. 567–568.
Media Planning Considerations• Availability- some too few; others too many• Cost-prices not fixed; susceptible to negotiation• Coverage-wide variety of media required to reach majority of market• Lack of Market Data
Media Selection• Newspapers• Magazines• Radio & Television• Satellite and Cable Television• Direct Mail• Internet• Other Media
Newspapers• Too many (Uruguay (pop. 3 million) 21 newspapers with combined circulation of 553,000)• Too few (Japan only 5 national daily newspapers with page limits of 16 -20)• Advertising may not be distinguishable from editorial
Magazines• Have small circulation and unreliable circulation figures• May have to rely on international edition of U.S. magazines• See Ad Age International for circulation and rates
Radio and Television• Major communications media in most nations; TV out pulls radio• Legislation varies, e.g. – France, 12 minutes per hour per TV channel – South Korea, Both government owned stations broadcast only a few hours per day – Most likely to be forbidden by government edict to accept certain advertising
Satellite and Cable TV• Satellite TV broadcasting growing importance, e.g. Sky Channel – Potentially lead to greater standardization & wider coverage – Challenges advertising creativity
Media Formats• Advertising on Kiosks and Fences• Outdoor Umbrellas• Billboards• Plastic Shopping Bags
Various International Formats, Features, and Trends • Posters on Kiosks and Fences Advertising Yes mineral water Advertising Marlboro cigarettes on fences in Bangladesh. on a kiosk in Poland.
Italian Yellow PagesFlorence Busses Italian (Venice) Billboards
What is global vs. local in these ads?
Budgeting Decisions• Objective-and-Task Method: – Identify advertising goals. – Conduct research – Determine cost of achieving goals. – Allocate the necessary sum.• Percent-of-Sales Method – Base budget on past or projected sales.
Budgeting Decisions (contd.) • Historical Method – Base budget on past expenditures giving more weight to recent expenditures. • Competitive Parity – Use international competitors’ budgets as benchmark. • Executive-judgment method – Use collective executive opinion. • All-You-Can-Afford