MARKETING

Chapter 17
Integrated Marketing
Communications

Etzel Walker Stanton

Chapter Objectives

• What is promotion?
• What types of promotion are there?
• What is the promotional mix?
• What is the Integrated Marketing Communication
Process?
• What are some possible promotional objectives?
• What are some methods used to budget promotional
activities?
The Role of Promotion in Marketing

Promotion is the element in an organization’s

marketing mix that serves to inform, persuade and
remind the market regarding the organization and/or its
products.

 It includes all the means by which a company communicates

directly with potential customers.
 It is an attempt to influence feelings, beliefs, or behavior.

 It is an attempt to shift the demand curve for a firm’s goods or

services
Promotion and Marketing
Customers shall know that a
product exists, also know about its
Informs benefits, how it works and how to
get it
Due to competition even customer
have many choices for basic
Persuades physiological needs so products nee
a persuasive message
Out of Sight, out of mind,
Reminds Product availability and its
potential to satisfy a need

Changes location &

shape of demand curve
 Demand goal Demand goal
with promotion with promotion
Price

Price
Demand Demand
without without
promotion promotion
Quantity Quantity
a. A shift in the demand b. Changing the shape
curve to the right. (or elasticity)
of the demand curve.
Promotion Methods
• Advertising
– paid form (identified sponsor); non-personal
presentation
– primary demand and selective demand
– television, radio, newspaper, magazines, direct mail,
mass transit vehicles, outdoor displays, handbills,
catalogs, directories
• Sales Promotion
– paid form; short term incentives to encourage purchase
or sale of a product or service
– event sponsorships, contests, trade shows, in-store
displays, rebates, samples, premiums, discounts,
coupons
 Promotion Methods

• Public Relations
– paid form; wide variety of mass and personal
communications that are image directed
– contribute to the favorable attitudes and opinions toward
an organization and its products
– newsletters, annual reports, lobbying, supporting
charitable or civic events
• Publicity
– not paid form; non-personal presentation
– involves news stories about an organization or its
products
• Personal Selling
– paid form; personal presentation to prospective
customer
Types of Promotion

NON-
PERSONAL PERSONAL

Personal Advertising, P.R.,

PAID Selling, Sales Promotion
P.R.

NOT- PAID Publicity

Promotional Mix

Refers to the particular combination of elements

(advertising, personal selling, publicity, public
relations, sales promotion) used by an
organization as part of its promotional strategy.
Promotional Mix
Promotion

Advertising

Product
Personal Selling

Sales Promotion Marketing

Price
Mix

Public Relations

Distribution
Publicity
 Advertising
Public relations and publicity
Personal selling
Sales promotion
•Effectiveness

Attention Interest Desire Action

Advertising, public relations, publicity best for attention.

Personal selling and sales promotion best for desire and action.
Integrated Marketing Communication
Integrated Marketing Communication (IMC) is a strategic
business process used to plan, develop, execute and
evaluate coordinated communication with an organization’s
publics.

All communication activities shall be coordinated, coherent

and supplementing each other in order to create an IMPACT

IMC begins with coordination of promotion with other 3 P’s

as only powerful product can be advertised effectively, also
middleman are very important for promotion
An Audience Perspective
The IMC approach takes an audience perspective when
planning and coordinating the organization’s communication
activities

Very little information comes from promotion to audience

and other contributors are personal experience, friends
opinions and comparisons made by competitors so the
promotion shall create an IMPACT and highly coordinated
IMC Elements
Characteristic
• Awareness of target audience information sources and their
media watching habits
• Understand audience knowledge and relationship with
desired response
• Use mix of promotion each with specific objectives
• Coordination to have consistency
• Continuous flow of information to audience needs
Implementing IMC
Several promotional campaigns with some running concurrently
and simultaneously at local, regional, national
and international level
Evaluating IMC
Various forms of evaluation
1) Findings of IMC (whether advertising has reinforced personal
selling)
2) Compare results with objectives ; Some typical objectives are
i) Awareness of a company or a brand
ii) Interest in a product or brand
iii) Action i.e. response to direct mail, customer inquiries etc
Barriers to IMC
• Departments are apart
• Lack of internal coordination and communication
• Belief that promotion shall be free and not planned at
objective levels
• Relying on only one form of promotion
The Communication Process
•Source •Encoding •Message •Channel •Noise •Decoding •Receiver

•Feedback

Source - party sending the message to another party

Encoding - the process of putting thought in symbolic form
Message - the set of symbols that the sender transmits
Channel - the paths through which the message moves from sender
to receiver
Noise - extraneous disturbances that interfere with communication
Selective Exposure Perception Retention
Decoding - the process by which the receiver assigns meaning to the
symbols transmitted by the sender
Receiver - the party receiving the message sent by another party
Feedback - the part of the receiver’s response that the receiver
communicates back to the sender
 MESSAGE
CHANNEL
•Select the media
ENCODING THE DECODING
•or other vehicle
MESSAGE THE MESSAGE
•to carry the message
Create an ad, Receiver compares
display, or sales message to
presentation frame of reference
NOISE MESSAGE
MESSAGE AS Competing ads, AS RECEIVED
INTENDED
other Knowledge, beliefs,
A promotional idea in
distractions or feelings of
marketer’s mind
receiver changed
FEEDBACK
RESPONSE
Impact measured
Ranges from simple
using research, sales,
awareness to
or another measure
purchase
The Communication Process
Process of sending some information to some other person
Elements include Message, Source, Channel and Receiver

People decode same message differently

Relationship between Promotion and Communication
1- Message can take many forms e.g. physical, symbolic etc
2- Endless creativity and variety of media having reach,
credibility, flexibility an cost
3- How message is decoded/interpreted depends on its from
and capacity and interest of recipient e.g. vocabulary,
verbal sophistication
4- Measurable Objectives
Marketing Communicator
• The marketing communicator must:
– Identify the target audience
– Clarify the response sought (awareness -
knowledge - liking - preference - conviction -
purchase)
– Choose a message
– Choose the channel (or media)
– Select source attributes – how source is
portrayed to the receiver
– Collect feedback
Determining the Promotional Mix
Promotional mix is combination of promotional activities

Factors influencing promotional mix

1- Target Audience
Target audience may be final consumer (existing or
prospective) or decision makers (in case of children)

Promotion aimed at middleman is called Push Strategy

whereas Promotion aimed at final consumer is termed as
Pull Strategy
• Push Strategy
– aimed at middlemen
– personal selling, sales promotions like contests
for salespeople, tradeshows
• Pull Strategy
– aimed at the end user
– advertising, sales promotions like premiums,
samples, in-store demonstrations
 PUSH
STRATEGY
•Producer •Wholesaler •Retailer •Consumer

PULL
STRATEGY
•Producer •Wholesaler •Retailer •Consumer

•Product flow •Promotion effort

2- Promotional Objectives
Six stages of Buyer Readiness (Hierarchy of Effects)
AIDA
– Awareness – Let buyer know product or brand exists
(attention)
– Knowledge - learning about a product’s or brand’s
features (interest)
– Liking - positive feeling about the product or brand
Change from indifferent to liking a product (interest)
– Preference - find one brand more attractive (desire)
– Conviction - actual decision or commitment to
purchase (desire)
– Purchase - buying the product (action)
3- Nature of the product
i) Unit value
For low unit value product, advertising is suggested and for
high unit value, personal selling is suitable
ii) Degree of Customization
Standardized product, advertising is suitable and for
customized products Personal Selling is better
iii) Presale and Post sale services
Products requiring frequent services require Personal Selling
e.g. Lawn Mowers and Power Boats
4) Stage in Product Life Cycle
In the introduction stage, informative advertising is used to
create awareness about new product as well as Personal
Selling
In growth stage, intensive advertising with persuasive
Message to meet competition
5) Funds Available
Companies having more budgets can do effective promotion
e.g. T.V Ads whereas low budget approach use Viral
Marketing where Consumers spread information about a
company to other people as well as Network Marketing
Determining the Promotional Budget

A challenging task as difficult to get and difficult to defend

Promotional Methods are usually concerned with Advertising

but may be applicable to any promotional activity
1) Percentage of Sales
– past or anticipated sales and most widely used
Step 1 past advertising spending = %age of sales
past sales
Step 2 %age of sales x next year sales forecast = New budget
Benefits includes easy to calculate, promotion is related to sales
whereas drawbacks include treat promotion as a result of sales
and not cause of it, decrease promotion when sale decline
whereas otherwise required
2) All Available Funds
– all money available to build sales and share, whatever is
left after spending on basic expenses
– Usually at the time of launch of a product
3) Following Competition
– match expenditures of competitors or to spend in
proportional to market share
– Following industry average or one competitor
Problems include competitors may be doing wrong or
company’s promotional objectives might be different from
competitors

4) Task or Objective
– determine task or objectives to be accomplished and
allocate funds to reach them
– best method to use
– Also called buildup method
DHL’s Integrated Marketing Campaign
DHL’s Outdoor Advertising
DHL’s Print Advertising
DHL’s Print Advertising Links to
Employees