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Prof Ashok Kumar
Text books : Advertising and Promotion 7th Edn             An Integrated Marketing Communication                    perspe...
2.1      Factors contributing to importance of IMC2.2      Participants in IMC management,2.3      IMC Planning Process2.4...
Unit 7   IMC –International Perspective           2Unit 8   Legal, Social & Ethical Aspects of IMC   2Unit 9   Case Studie...
A management concept designed to make all aspects ofmarketing communications such as internal , external( advertising, sal...
IMC’s aim : PERSUADE   WITH TARGETED AUDIENCES TO           INFLUENCE ATTITUDES AND BEHAVIOR                          Info...
MARKETING COMMUNICATIONS OBJECTIVES          •   Increase Market Penetration          •   Develop Repeat Purchase Behavior...
The levels of integration such as Horizontal, Vertical,Internal, External and Data integration help tostrengthen Integrate...
.Vertical Integration means marketing and communicationsobjectives must support the higher level corporate objectivesand c...
Effective Marketing Communications• Step 1: Identifying the target audience  – Includes assessing the audience’s perceptio...
Communication theoryAccording to Source Credibility Theory, acceptance of themessage depends on:Expertness and Trustworthi...
Message Content                   Expertness           TrustworthinessExpertness is defined as                   Trustwort...
According to Source Attractiveness Theory, which is basedon social psychological research, the acceptance of themessage de...
This theory explains the message acceptance in two ways:Identification and Conditioning.Identification is when the target ...
Brand communication strategy           without having Consumer insight is             Likewinking at a pretty girl in dark...
Consumer       DecisionValuedelivery
Persuasive communication models to shift the attitude                                Hierarchy-of-             AIDA       ...
AIDA and Hierarchy of Effects                to persuade the target audience                                         Purch...
Foote, Cone & Belding Grid for effective       communication strategy                     Thinking       Feeling     Invol...
Best Print Ads January 2012
Media Agency’s organization structure                                       Agency                                       D...
KEY Account Management – Within an advertising agency the account manageror account executive is tasked with handling all ...
Market Researchers – Advertising agencies employ market researchers who assessa client’s market situation, including under...
IMC Plan– An IMC plan outlines all the advertising or  marketing communication activities.– Usually done on an annual basi...
Regulation of         PromotionSelf-Regulation• Association of Advertising council Central Regulation• Ministry of IB
STEPS of IMC Plan•Situation analysis•Marketing objectives•Marketing budget•Marketing strategies•Marketing tactics•Evaluati...
Message strategy– Key Consumer Insight– Big Idea– Executions
Examples of Niche Agencies•   Media shops – Mindshare, Madison, Starcom•   Creative boutiques – Ray and Kesavan•   Event m...
Effects of communicationMessage Knowledge     Attitude   From Grunig & Hunt (1984)              Behaviour
Media evaluation system•   Influence or tone•   Message communicated•   Prominence•   Audience reached•   Consultant/spoke...
Evaluation model                                  Research methodsOUTCOME                 Change                          ...
Techniques for Setting Promotion            Budgets       • All - You - Can - Afford       • Competitive Parity       • Pe...
Elements of the Promotion                    Mix                           Advertising                         Public Rela...
When Elements of Promotion Are Most                                     Useful                                            ...
Factors that Affect the Promotion                   MixNature of the ProductStage in the Product Life CycleTarget Market C...
Creating a Promotion        Plan          Analyze the Marketplace           Identify Target Market         Set Promotion O...
Criteria for Setting Promotion           Objectives        Promotion objectives should:            be measurable, concrete...
Examples of Promotion          ObjectivesObjective: To Inform (Awareness)To increase the top-of-mind awareness level for P...
Effects of                                          Advertising                                                           ...
Major Types of                     Advertising                                Corporate Image              Institutional  ...
Advertising Campaign Decision                 Process             Determine the campaign objectives.Make creative decision...
Common Advertising        AppealsProfitProfit              Save money, keep from losing money                    Save mone...
Executional Styles for               Advertising                 Scientific        Slice-of-Life  Musical                 ...
Methods Used to Evaluate Advertising Campaigns           Pretests           Examples:           • Consumer jury tests     ...
The Tools of Public     Relations                       New Product Publicity                        Product Placement    ...
Tools for Consumer Sales            Promotion                               Coupons                               Premiums...
Tools for Trade Sales            Promotion    Trade Allowances      Push Money                                   Six      ...
Advantages of Personal       Selling            Detailed            Detailed         Information          Information    M...
Advertising Versus Personal           SellingPersonal Selling is more important if...The product has a high value.It is a ...
Differences Between Traditional & Relationship                                 Selling         Traditional Personal Sellin...
Steps in the Selling      Process                         Generating Sales Leads                          Qualifying Sales...
Functions of Sales             Management                                Set Sales     Evaluate                   Objectiv...
Cost Determinants of          200                  Price          150                                                     ...
Break-Even             Analysis                                                  Total Revenue                            ...
Steps in Setting the Right          Price          Establish Pricing Goals         Estimate Demand, Costs,                ...
Legal and Ethical Issues in           Pricing                       Unfair Trade Practices Key Legal Key Legal            ...
Discounts, Allowances, and             Rebates    Cash                                   EDLP  Discount  Quantity         ...
Geographic   Pricing                 FOB Origin              Uniform Delivered  Pricing  Pricing Tactics  Tactics       Zo...
Special Pricing       Tactics                          Single     Two-Part             Price              Flexible      Pr...
Integrated Marketing Communication
Integrated Marketing Communication
Integrated Marketing Communication
Integrated Marketing Communication
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Transcript of "Integrated Marketing Communication"

  1. 1. Prof Ashok Kumar
  2. 2. Text books : Advertising and Promotion 7th Edn An Integrated Marketing Communication perspective . By Blech .G and BlechM and Keyoor Purani Strategic Communications, Planning for effective Public relation & Marketing . 5th Edn . By Dubuque, I.A Kendall / Hunt .
  3. 3. 2.1 Factors contributing to importance of IMC2.2 Participants in IMC management,2.3 IMC Planning Process2.4 Structure of Promotion Industry,Unit 3 IMC – Marketing Environment & 5 Understanding the Consumer Behavior3.1 Understanding of Marketing Environment3.2 Segmentation, Targeting and Positioning3.3 Understanding the consumer buying behaviorUnit 4 IMC- communication Process 44.1 Understanding IMC communication Process4.2 Understanding the Massage, Objective and4.3 budgeting for IMC Response hierarchy modelsUnit 5 IMC Strategies 45.1 Creative Strategy5.2 Media StrategyUnit 6 IMC Tool 96.1 Advertising6.2 Sales Promotion6.3 Public Relations & Corporate Advertising6.4 Internet Advertising & E-commerce6.5 Direct Marketing6.6 Sponsorship & Point-of-purchase6.7 Personal Selling & Sales Management
  4. 4. Unit 7 IMC –International Perspective 2Unit 8 Legal, Social & Ethical Aspects of IMC 2Unit 9 Case Studies and Guest Session & 5 Assignment
  5. 5. A management concept designed to make all aspects ofmarketing communications such as internal , external( advertising, sales promotion, online media, social network ,public relations, and direct marketing ) , horizontal and verticalwork together as a unified force, rather than permitting each towork in isolation. Basic premise :“The sum is always greater than their parts” – Provided theyspeak consistently with one voice all the time, every time . Why integration?• Consistency, else confusion• Clarity, else confusion• Impact, since different Marcom tools have different strengths• The tools of IMC thus need to be integrated
  6. 6. IMC’s aim : PERSUADE WITH TARGETED AUDIENCES TO INFLUENCE ATTITUDES AND BEHAVIOR Inform Reinforce Persuade Remind
  7. 7. MARKETING COMMUNICATIONS OBJECTIVES • Increase Market Penetration • Develop Repeat Purchase Behavior • Establish Customer Relationships • Increase Rate of Consumption • Encourage Product Trial • Stimulate Impulse Buying • Stimulate Demand • Differentiate the Product • Establish a Product Image • Influence Sales Volume • Establish, Modify, or Reinforce Attitudes • Develop Sales Leads • Stimulate Interest • Establish Understanding • Build Support & Acceptance
  8. 8. The levels of integration such as Horizontal, Vertical,Internal, External and Data integration help tostrengthen Integrated Communications.Horizontal Integration occurs across the marketing mixand across business functions - for example,production, finance, distribution and communicationsshould work together and be conscious that theirdecisions and actions send messages to customers.While different departments such as sales, direct mailand advertising can help each other through DataIntegration. This requires a marketing informationsystem which collects and shares relevant data acrossdifferent departments
  9. 9. .Vertical Integration means marketing and communicationsobjectives must support the higher level corporate objectivesand corporate missions.Internal Integration requires internal marketing - keeping allstaff informed and motivated about any new developmentsfrom new advertisements, to new corporate identities, newservice standards, new strategic partners and so on.External partners such as advertising and PR agencies,channel to work closely together to deliver a single seamlesssolution - a cohesive message - an integrated message.
  10. 10. Effective Marketing Communications• Step 1: Identifying the target audience – Includes assessing the audience’s perceptions of the company, product, and competitors’ company/product image• Step 2: Cognitive, affective, and behavioral objectives may be set• Step 3: AIDA model guides message design
  11. 11. Communication theoryAccording to Source Credibility Theory, acceptance of themessage depends on:Expertness and Trustworthiness of the source.Expertness is defined as the perceived ability of thesource to make valid assertions.Trustworthiness is defined as the perceived willingness ofthe source to make valid assertions.Target Audience acceptance increases with theexpertness of the source and the ability of the audience toevaluate the product.
  12. 12. Message Content Expertness TrustworthinessExpertness is defined as Trustworthiness isthe perceived ability of the defined as thesource to make valid perceived willingnessassertions. of the source to make valid assertions. Acceptance by target audience
  13. 13. According to Source Attractiveness Theory, which is basedon social psychological research, the acceptance of themessage depends on :1.Familiarity, Likeability & Similarity.Familiarity is the audiences knowledge of the sourcethrough exposure.2.Likeability is the affection for the sources physicalappearance and behavior .3.Similarity is the resemblance between source andreceiver.
  14. 14. This theory explains the message acceptance in two ways:Identification and Conditioning.Identification is when the target audience begins to identifywith the sources attractiveness, and hence tends to accepthis opinions, beliefs, habits, attitudes etc.Conditioning is when the attractiveness of the source issupposed to pass on to the brand after regular association ofthe source with the brand.
  15. 15. Brand communication strategy without having Consumer insight is Likewinking at a pretty girl in dark. “Ogilvy & Mather India” (O&M), India’s largest advertising agency 17
  16. 16. Consumer DecisionValuedelivery
  17. 17. Persuasive communication models to shift the attitude Hierarchy-of- AIDA EffectsStages Model Model AwarenessCognitive Attention stage Knowledge Liking InterestAffective Preference stage Desire ConvictionBehavior Action Purchase stage
  18. 18. AIDA and Hierarchy of Effects to persuade the target audience Purchase Conviction Preference Liking KnowledgeAwareness Attention Interest Desire Action AIDA
  19. 19. Foote, Cone & Belding Grid for effective communication strategy Thinking Feeling Involvement 2 1 High Affective Informative Emotional Strategy appeal 3 Involvement Habit 4 Low Formation Self- ego Consumer Satisfaction Conditioning
  20. 20. Best Print Ads January 2012
  21. 21. Media Agency’s organization structure Agency Director Market surveyKey Account Creative Media Planning Post Finance and andManagement Planning & buying production client billing BehaviorAnd services division Division Division research
  22. 22. KEY Account Management – Within an advertising agency the account manageror account executive is tasked with handling all major decisions related to aspecific client. These responsibilities include locating and negotiating to acquireclients. Once the client has agreed to work with the agency, the account managerworks closely with the client to develop an advertising strategy. For very largeclients, such as large consumer products companies, an advertising agency mayassign an account manager to work full-time with only one client and, possibly,with only one of the client’s product lines. For smaller accounts an accountmanager may simultaneously manage several different, though non-competing,accounts.Creative Team –The principle role of account managers is to manage the overalladvertising campaign for a client, which often includes delegating selective tasksto specialists. For large accounts one task account managers routinely delegateinvolves generating ideas, designing concepts and creating the final dvertisement,which generally becomes the responsibility of the agency’s creative team. Anagency’s creative team consists of specialists in**GRAPHIC DESIGN SECTION**COPY WRITING SECTION**FILM PRODUCTION**AUDIO PRODUCTION**COMPUTER PROGRAMMING
  23. 23. Market Researchers – Advertising agencies employ market researchers who assessa client’s market situation, including understanding customers and competitors, andalso are used to test creative ideas. For instance, in the early stages of anadvertising campaign researchers may run focus group sessions with selectedmembers of the client’s target market in order to get their reaction to severaladvertising concepts. Researchers are also used following the completion of anadvertising campaign to measure whether the campaign reached its objectives.**CONSUMER RESEARCH**MARKET AUDIT**MARKET SURVEYSMedia Planners – Once an advertisement is created, it must be placed through anappropriate advertising media. Each advertising media, has its own unique methodsfor accepting advertisements, such as different advertising cost structures differentrequirements for accepting ad designs, different ways placements can be purchased(e.g., direct contact with media or through third-party seller), and different timeschedules (i.e., when ad will be run). Understanding the nuances of different mediais the role of a media planner, who looks for the best media match for a client andalso negotiates the best deals.**MEDIA SURVEY*TARGET AUDIENCE STUDY**MEDIA PLANNING*MEDIA BUYING
  24. 24. IMC Plan– An IMC plan outlines all the advertising or marketing communication activities.– Usually done on an annual basis– Companies may develop a campaign plan, which is more tightly focused on solving a particular marketing communication problem.– A campaign plan typically includes a variety of messages carried in different media and sometimes targeted to different audiences.
  25. 25. Regulation of PromotionSelf-Regulation• Association of Advertising council Central Regulation• Ministry of IB
  26. 26. STEPS of IMC Plan•Situation analysis•Marketing objectives•Marketing budget•Marketing strategies•Marketing tactics•Evaluation of performance
  27. 27. Message strategy– Key Consumer Insight– Big Idea– Executions
  28. 28. Examples of Niche Agencies• Media shops – Mindshare, Madison, Starcom• Creative boutiques – Ray and Kesavan• Event management agencies- Wizcraft• Sales Promotion agencies• Direct marketing outfits – Lintas Direct• PR houses – Genesis• Research suppliers – MARG, IMRB, Nielsen
  29. 29. Effects of communicationMessage Knowledge Attitude From Grunig & Hunt (1984) Behaviour
  30. 30. Media evaluation system• Influence or tone• Message communicated• Prominence• Audience reached• Consultant/spokesman quoted• Type of article
  31. 31. Evaluation model Research methodsOUTCOME Change Quantitative surveys behaviour Focus groups Change attitudes Understand messages InterviewsOUTTAKE Response analysis Retain messages Messages in the media Media content analysis Message presentation Expert analysisOUTPUT Message content Feedback Media selection Observations Source: Macnamara
  32. 32. Techniques for Setting Promotion Budgets • All - You - Can - Afford • Competitive Parity • Percent of Sales • Market Share • Objective and Task
  33. 33. Elements of the Promotion Mix Advertising Public RelationsIngredients Ingredients of the of the Promotion Personal Selling Promotion Mix Mix Sales Promotion Internet Promotion
  34. 34. When Elements of Promotion Are Most Useful AdvertisingEffectiveness Personal selling Sales promotion Public relations Awareness Knowledge Liking Preference Conviction Purchase Very effective Somewhat effective Either not effective or inefficient
  35. 35. Factors that Affect the Promotion MixNature of the ProductStage in the Product Life CycleTarget Market CharacteristicsType of Buying DecisionPromotion budgetPush–and–Pull Strategies
  36. 36. Creating a Promotion Plan Analyze the Marketplace Identify Target Market Set Promotion Objectives Develop Promotion Budget Choose Promotion Mix
  37. 37. Criteria for Setting Promotion Objectives Promotion objectives should: be measurable, concrete be based on sound research, with a well-defined target audience be realistic reinforce the overall marketing plan and relate to specific marketing objectives
  38. 38. Examples of Promotion ObjectivesObjective: To Inform (Awareness)To increase the top-of-mind awareness level for Peter Panpeanut butter from 16 percent to 24 percentObjective: To Persuade (Attitudinal)To increase the percentage of parents who feel that Peter Panpeanut butter is the best peanut butter for their children from22 percent to 35 percentObjective: To RemindTo remind consumers that Peter Pan peanut butter is thecreamiest peanut butter and is available at their nearest groceryand convenience stores
  39. 39. Effects of Advertising DiminishingReturn on Advertising Expenditures returns on additional spending Increasing efficiency as ad budget becomes sufficient Advertising Spending
  40. 40. Major Types of Advertising Corporate Image Institutional Advertising Advocacy Advertising Types Types of ofAdvertisingAdvertising Pioneering Product Competitive Advertising Comparative
  41. 41. Advertising Campaign Decision Process Determine the campaign objectives.Make creative decisions. Make media decisions. Evaluate the campaign.
  42. 42. Common Advertising AppealsProfitProfit Save money, keep from losing money Save money, keep from losing moneyHealthHealth Body-conscious, healthy Body-conscious, healthyLove or RomanceLove or Romance Sell cosmetics and perfumes Sell cosmetics and perfumes Social embarrassment, growing old, losing Social embarrassment, growing old, losingFearFear health, power health, powerAdmirationAdmiration Celebrity endorsement effective Celebrity endorsement effectiveConvenienceConvenience Fast-food and microwave products Fast-food and microwave productsFun and PleasureFun and Pleasure Vacations, beer, amusement parks Vacations, beer, amusement parksVanity and Egotism Expensive, conspicuous itemsVanity and Egotism Expensive, conspicuous items
  43. 43. Executional Styles for Advertising Scientific Slice-of-Life Musical LifestyleDemon- Common Common Spokes- person/stration Executional Executional Testimonial Styles Styles Mood or Fantasy Image Real/ Animated Humorous Product Symbols
  44. 44. Methods Used to Evaluate Advertising Campaigns Pretests Examples: • Consumer jury tests • Portfolio or unfinished rough tests • Physiological tests Post-tests Examples: • Recognition tests • Recall tests • Attitude measures • Audience size measurement
  45. 45. The Tools of Public Relations New Product Publicity Product Placement Customer Satisfaction Major Major Phone Lines Tools ToolsUsed ByUsed By Consumer Education PR PRAgencyAgency Event Sponsorship Issue Sponsorship Web Sites
  46. 46. Tools for Consumer Sales Promotion Coupons Premiums Six SixCategories Categories Frequent Buyer Programs of ofConsumer Consumer Contests and Sales Sales SweepstakesPromotionsPromotions Samples Point-of-Purchase Displays
  47. 47. Tools for Trade Sales Promotion Trade Allowances Push Money Six Six Training Categories Categories of of Trade Trade Free Merchandise Sales Sales Promotions Promotions Store Demonstrations Business Meetings,Conventions, Trade-Shows
  48. 48. Advantages of Personal Selling Detailed Detailed Information Information Message Control Message Control Targeted Targeted Cost Control Cost Control Closing Sales Closing Sales
  49. 49. Advertising Versus Personal SellingPersonal Selling is more important if...The product has a high value.It is a custom-made product.There are few customers.The product is technically complex.Customers are geographically concentrated.Advertising/Sales Promotion is more important if...The product has a low value.It is a standardized product.There are many customers.The product is simple to understand.Customers are geographically dispersed.
  50. 50. Differences Between Traditional & Relationship Selling Traditional Personal Selling Relationship Selling Sell products (goods and services) Sell advice, assistance, and counsel Focus on closing sales Focus on improving the customer’s bottom line Limited sales planning Considers sales planning as top priority Spend most contact time telling Spend most contact time attempting to build a customers about product problem-solving environment with the customer Conduct “product-specific” needs Conduct discovery in the full scope of the assessment customer’s operations “Lone-wolf” approach to the account Team approach to the account Proposals and presentations based Proposals and presentations based on profit on pricing and product features impact and strategic benefits to the customer Sales follow-up focused on product Sales follow-up is long term, focused on delivery long-term relationship enhancementSource: Robert M. Peterson, Patrick L. Shul, and George H. Lucas, Jr., “Consultative Selling: Walking the Walk in the New Selling Environment,”National Conference on Sales Management, Proceedings, March 1996.
  51. 51. Steps in the Selling Process Generating Sales Leads Qualifying Sales Leads Basic Basic Making the Sales ApproachSteps inSteps in Making the Sales the the PresentationSelling SellingProcessProcess Handling Objections Closing the Sale Following Up
  52. 52. Functions of Sales Management Set Sales Evaluate Objectives Structure Sales Force Sales ForceManage Major Tasks of Major Tasks of Determine Sales ForceTurnover Sales Sales Size Management Management Develop Motivate Compen-Sales Force sation Plan Train Sales Recruit Sales Force Force
  53. 53. Cost Determinants of 200 Price 150 MCDollars ATC 100 AVC 50 AFC 0 1 2 3 4 5 6 7 8 9 10 Quantity
  54. 54. Break-Even Analysis Total Revenue Break Even Profits Total CostsPrice ($) Fixed Costs Losses Quantity (units)
  55. 55. Steps in Setting the Right Price Establish Pricing Goals Estimate Demand, Costs, and Profits Choose Strategy Fine-Tune Base Price $ $ $ $ Price $ $ Right $ $
  56. 56. Legal and Ethical Issues in Pricing Unfair Trade Practices Key Legal Key Legal Price Fixingand Ethicaland Ethical Issues IssuesRelated to Related to Price Price Discrimination Price Predatory Pricing
  57. 57. Discounts, Allowances, and Rebates Cash EDLP Discount Quantity Seasonal Discount Price Discounts Price Reductions Reductions Functional Promotional Discount AllowancesTrade Loading Rebates
  58. 58. Geographic Pricing FOB Origin Uniform Delivered Pricing Pricing Tactics Tactics Zone PricingBased on Based onGeographyGeography Freight-Absorption Basing-Point
  59. 59. Special Pricing Tactics Single Two-Part Price Flexible Pricing PricingBundle Common Common ProfessionalPricing Special Pricing Special Pricing Services Tactics TacticsOdd-Even Price Pricing Lining Bait Leader Pricing Pricing
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