PowerPoint Chapter 17

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PowerPoint Chapter 17

  1. 1. Chapter 17 Integrated Marketing Communications
  2. 2. Chapter Overview <ul><li>Promotion </li></ul><ul><li>Marketing Communications </li></ul>
  3. 3. Integrated Marketing Communications <ul><li>Coordination of all promotional activities to produce a unified customer-focused promotional message </li></ul><ul><ul><li>Success of any IMC program depends on identifying the members of an audience and understanding what they want </li></ul></ul>
  4. 4. <ul><li>Where’s The Tracker? </li></ul><ul><ul><li>Tracker’s IMC Program Included a Game for Chevrolet Tracker That Drew 1.3 Million Entries Online and Another 100,000 Offline </li></ul></ul>
  5. 5. Example of an Ad Enhancing GM’s Integrated Marketing Communications Program
  6. 6. <ul><li>Importance of Teamwork </li></ul><ul><ul><li>IMC requires a total strategy including all marketing activities, not just promotion </li></ul></ul><ul><ul><li>Successful implementation of IMC requires that everyone involved in every aspect of promotion function as a team </li></ul></ul>
  7. 7. <ul><li>Role of Databases in Effective IMC Programs </li></ul><ul><ul><li>With the growth of the Internet, marketers have been given the power to gather information faster and to organize it easier than ever before </li></ul></ul><ul><ul><li>By sharing this knowledge appropriately among all relative parties, a firm can lay the foundation for a successful IMC program </li></ul></ul>
  8. 8. The Communications Process <ul><li>An effective promotional message accomplishes three tasks: </li></ul><ul><ul><li>It gains the receiver’s attention </li></ul></ul><ul><ul><li>It achieves understanding </li></ul></ul><ul><ul><li>It stimulates the receiver’s needs and suggests an appropriate method of satisfying them </li></ul></ul><ul><li>AIDA concept </li></ul>
  9. 9. See if this ad gets your attention. Keep in mind not all advertisements are designed to sell a product or service. So what is this ad’s objective(s)?
  10. 10. Example of an Ad Accomplishing the Three Tasks of the Communications Process for Its Target Market
  11. 11. <ul><li>Global Difficulties with the Communication Process </li></ul><ul><ul><li>In China: KFC’s slogan: “Finger lickin’ good” came out as “Eat your fingers off” </li></ul></ul><ul><ul><li>Also in China: Coca-Cola had thousands of signs made using the translation: “Ke-kou-ke-la” </li></ul></ul><ul><ul><ul><li>Depending on the dialect this means . . . </li></ul></ul></ul><ul><ul><ul><li>“ Bite the wax tadpole,” or </li></ul></ul></ul><ul><ul><ul><li>“ Female horse stuffed with wax” </li></ul></ul></ul><ul><ul><li>In Taiwan: Pepsi’s slogan, “Come alive with the Pepsi generation” came out as “Pepsi will bring your ancestors back from the dead” </li></ul></ul>
  12. 12. Objectives of Promotion <ul><li>Provide Information </li></ul><ul><ul><li>Disney World Ad promoting a free video to provide Information for vacation planning </li></ul></ul>
  13. 13. <ul><li>Increase Demand </li></ul><ul><ul><li>Some promotions are aimed at increasing primary demand, the desire for a general product category </li></ul></ul><ul><ul><li>More promotions are aimed at increasing selective demand, the desire for a specific brand </li></ul></ul>
  14. 14. <ul><li>Differentiate the Product </li></ul><ul><ul><li>Homogenous demand for many products results when consumers regard the firm’s output as virtually identical to its competitors’ </li></ul></ul>
  15. 15. Daewoo Lanos Television Ad Differentiating Its Product from Those of the Competition
  16. 16. Identify how two competitors, Visa and MasterCard, go about differentiating their products in these two ads.
  17. 17. <ul><li>Accentuate the Product’s Value </li></ul><ul><ul><li>Promotion can explain the greater ownership utility of a product to buyers </li></ul></ul><ul><ul><li>Johnson & Johnson First Aid To Go! Accentuating a Product’s Value </li></ul></ul>
  18. 18. <ul><li>Stabilize Sales </li></ul><ul><ul><li>For the typical firm, sales fluctuations may result from cyclical, seasonal, or irregular demand </li></ul></ul><ul><ul><li>Stabilizing these variations is often an objective of promotional strategy </li></ul></ul>Class Discussion Is the purpose of this ad primarily to provide information, increase demand, differentiate the product, accentuate the product’s value or stabilize sales?
  19. 19. Elements of the Promotional Mix <ul><li>Promotional mix : blend of personal selling and nonpersonal selling designed to achieve promotional objectives </li></ul><ul><ul><li>Personal selling </li></ul></ul><ul><ul><li>Nonpersonal selling </li></ul></ul>
  20. 20. <ul><li>Advertising </li></ul><ul><ul><li>Paid, nonpersonal communication through various media with the hope of informing or persuading members of a particular audience </li></ul></ul>
  21. 21. <ul><li>Product Placement </li></ul><ul><ul><li>Marketer pays a motion picture or television program owner a fee to display his or her product prominently in the film or show </li></ul></ul>Big budget movies, such as The Matrix, feature prominent placement of various products throughout the movie.
  22. 22. <ul><li>Sales Promotion </li></ul><ul><ul><li>Marketing activities that stimulates consumer purchasing </li></ul></ul><ul><ul><li>Trade promotion </li></ul></ul>
  23. 23. TV AD using a popular sales promotion technique: A free premium with the purchase of an item.
  24. 24. <ul><li>Direct Marketing </li></ul><ul><ul><li>Direct communications other than personal sales contact between buyer and seller, designed to generate sales, information requests, or store visits </li></ul></ul>
  25. 25. <ul><li>Public relations : firm’s communications and relationships with its various publics </li></ul><ul><li>Publicity : stimulation of demand for good, service, place, idea, person, or organization by unpaid placement of commercially significant news or favorable media presentations </li></ul>
  26. 26. Sponsorships <ul><li>Provision of funds for a sporting or cultural event in exchange for a direct association with the events; in e-commerce, a long-term linkage between a Web site and a marketer </li></ul>
  27. 27. <ul><li>Sponsorship Spending has more than tripled during the past 10 years to almost $10 Billion. </li></ul><ul><ul><li>AT&T : A Sponsor of the PGA Tour </li></ul></ul>
  28. 28. <ul><li>Growth of Sponsorships </li></ul><ul><ul><li>Sponsorship has grown rapidly during the past 30 years </li></ul></ul><ul><li>How Sponsorship Differs from Advertising </li></ul><ul><ul><li>Degree of control </li></ul></ul><ul><ul><li>Nature of the message </li></ul></ul><ul><ul><li>Audience reaction </li></ul></ul><ul><ul><li>Measurements of effectiveness </li></ul></ul>
  29. 29. Direct Marketing <ul><li>Rapidly growing promotional mix element </li></ul><ul><ul><li>Related overall spending total $1.7 trillion </li></ul></ul><ul><li>Direct Marketing Communication Channels </li></ul>
  30. 30. <ul><li>Direct Mail </li></ul><ul><ul><li>Marketers combine information from internal and external databases, surveys, coupons, and rebates that require responses to provide information about consumer lifestyles, buying habits, and wants </li></ul></ul><ul><ul><li>Catalogs </li></ul></ul>
  31. 31. <ul><li>Telemarketing : Includes outbound contacts by salespeople or inbound contacts initiated by customers who want to obtain information and place orders </li></ul>Offering Toll-Free Telephone Numbers to Catalog Shoppers
  32. 32. <ul><li>Direct Marketing via Broadcast Channels </li></ul><ul><ul><li>Brief (30 to 90 second) direct response ads on television or radio </li></ul></ul><ul><ul><li>Home shopping channels like: </li></ul></ul><ul><ul><ul><li>QVC </li></ul></ul></ul><ul><ul><ul><li>HSN </li></ul></ul></ul><ul><li>Infomercial : promotional presentation for a single product running 30 minutes or longer in a format that resembles a regular television program </li></ul>
  33. 33. <ul><li>Electronic Direct Marketing Channels </li></ul><ul><ul><li>E-mail direct marketing is a natural and easy extension of traditional direct mail marketing </li></ul></ul><ul><li>Other Direct Marketing Channels </li></ul><ul><ul><li>Print media is generally not as effective as Web marketing or telemarketing for direct marketers </li></ul></ul>
  34. 34. <ul><li>Peoplepc </li></ul><ul><ul><li>This Print Ad Supplements a Promotional Campaign That Is Primarily Based on Broadcast Advertising </li></ul></ul>
  35. 35. <ul><li>Starbucks Encore </li></ul><ul><ul><li>Starbucks’ Direct-Response Print Ad </li></ul></ul>
  36. 36. Developing an Optimal Promotional Mix <ul><li>Factors that influence the effectiveness of a promotional to mix: </li></ul><ul><ul><li>Nature of the market </li></ul></ul><ul><ul><li>Nature of the product </li></ul></ul><ul><ul><li>Stage in the product life-cycle </li></ul></ul><ul><ul><li>Price </li></ul></ul><ul><ul><li>Funds available for promotion </li></ul></ul>
  37. 37. Promotional Strategies <ul><li>Pulling strategy </li></ul><ul><li>Pushing strategy </li></ul>
  38. 38. <ul><li>Colgate Total </li></ul><ul><ul><li>Using a Pulling Strategy With Ads Like This Combined With a Pushing Strategy Created Strong Demand for This Improved Product </li></ul></ul>
  39. 39. Budgeting for Promotional Strategy <ul><li>Percentage-of-sales method </li></ul><ul><li>Fixed-sum-per-unit method </li></ul><ul><li>Meeting competition method </li></ul><ul><li>Task-objective method </li></ul>
  40. 40. Measuring the Effectiveness of Promotion <ul><li>Two basic measurement tools: </li></ul><ul><ul><li>Direct sales results </li></ul></ul><ul><ul><li>Indirect evaluation concentrates on quantifiable indicators of effectiveness like: </li></ul></ul><ul><ul><ul><li>Recall </li></ul></ul></ul><ul><ul><ul><li>Readership </li></ul></ul></ul>
  41. 41. The Value of Marketing Communications <ul><li>Social Importance </li></ul><ul><ul><li>Society provides no commonly accepted set of standards regarding taste </li></ul></ul><ul><ul><li>The one generally accepted standard in a market society is freedom of choice </li></ul></ul><ul><ul><li>Promotion helps achieve socially oriented objectives like the elimination of drug abuse </li></ul></ul>
  42. 42. <ul><li>Promotional Message Addressing a Universal Social Concern </li></ul>
  43. 43. <ul><li>Merck Vaccine Division </li></ul><ul><ul><li>The Social Importance of Marketing Communications </li></ul></ul>
  44. 44. <ul><li>Business Importance </li></ul><ul><ul><li>Promotion has become increasingly important to both large and small firms </li></ul></ul><ul><ul><li>Promotion is an effective tool to change attitudes, boost brand loyalty and increase sales </li></ul></ul><ul><ul><li>Both business and nonbusiness enterprises recognize the importance of promotion </li></ul></ul>
  45. 45. The effectiveness of advertisements like this classic to encourage brand loyalty and increase sales is well-documented.
  46. 46. <ul><li>Economic Importance </li></ul><ul><ul><li>Effective promotion has allowed society to derive benefits not otherwise available </li></ul></ul><ul><ul><li>Promotion increases the number of units sold, which lowers production costs and sales prices </li></ul></ul>

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