I n t e r n a t i o n a l M a r k e t i n g Integrated Marketing Communications and International Advertising Chapter t h E d i t i o n P h i l i p R. C a t e o r a M a r y C. G i l l y J o h n L. G r a h a m McGraw-Hill/Irwin International Marketing 14/e Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved.

16-2 What Should You Learn? Local market characteristics that affect the advertising and promotion of products The strengths and weaknesses of sales promotion and public relations in global marketing When global advertising is most effective; when modified advertising is necessary

16-3 What Should You Learn? The effects of a single European market on advertising The effect of limited media, excessive media, paper and equipment shortages, and government regulations on advertising and promotion budgets The communication process and advertising misfires

16-4 Introduction Not product, but consumer Not price, but cost Not place, but convenience Not promotion, but communication Not product, but consumer Not price, but cost Not place, but convenience Not promotion, but communication Traditional “4 Ps”vs. IMC’s “4 Cs”

16-5 Introduction Integrated marketing communications (IMC) comprises: Objective: the successful sale of a product or service IMC advertising Personal selling Sales promotions Direct selling Public relations Internet communication relationships Trade show

16-6 Sales Promotions in International Markets 1.Cents-off 2.In-Store Demonstrations 3.Samples 4.Coupons 5.Gifts Sales promotions are marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation Examples of sales promotion include: Sales promotions are short-term efforts directed to the consumer or retailer to achieve such specific objectives as consumer- product trial or immediate purchase 6.Product Tie-Ins 7.Contests 8.Sweepstakes ( 彩金 ) 9.Sponsorship of Special Events, 10.Point-Of-Purchase Displays

16-7 Case Study: Gift Giving Exhibitors at a trade show could not understand why Chinese visitors were not stopping by their booth. Workers were wearing green hats and were using them as giveaways as well. They later learned that for many Chinese, green hats are associated with infidelity; the Chinese expression “He wears a green hat” indicates that a man’s wife has been cheating on him. When they discarded the green hats and gave out T-shirts and coffee mugs instead, they had a number of Chinese visitors (Dresser, 1996)

16-8 International Public Relations Public relations (PR) is creating good relationships with the popular press and other media  To help companies communicate messages to customers, the general public, and governmental regulators Bridgestone/Firestone Tires safety recall Global workplace standards Building an international profile Corporate sponsorships

16-9 Crisis Public Relations 1.address the public immediately following the discovery of the crisis promptly 2.maintain honesty because the public is more willing to forgive an honest mistake than a calculated lie. 3.to be informative because the media as well as the public will create their own rumors if no information is given to them by the corporation in crisis. 4.to be concerned and show the public you care because people will be more forgiving. 5.maintain two-way relationships 1.address the public immediately following the discovery of the crisis promptly 2.maintain honesty because the public is more willing to forgive an honest mistake than a calculated lie. 3.to be informative because the media as well as the public will create their own rumors if no information is given to them by the corporation in crisis. 4.to be concerned and show the public you care because people will be more forgiving. 5.maintain two-way relationships There are five steps are to manage any crisis public relations situation.

16-10 Case Study: Crisis PR Toyota Recalls More Cars, But Customers Stay Loyal Questions Why did Toyota recall cars? How many defected cars have been recalled? What is the results of recalling cars? Toyota Recalls More Cars, But Customers Stay Loyal Questions Why did Toyota recall cars? How many defected cars have been recalled? What is the results of recalling cars?

16-11 Top 20 Global Advertisers ($ millions) Exhibit 16.1

16-12 Top 100 Advertisers’ Global Spending ($ millions) Exhibit 16.2

16-13 Top Ten Advertisers (Russia and China – $ millions) Exhibit 16.3 (A) Russia (B) China

16-14 International Advertising Decisions involving advertising are those most often affected by cultural differences among country markets Consumers respond in terms of their culture, its style, feelings, value systems, attitudes, beliefs, and perceptions Advertising’s function is to interpret the qualities of products in terms of consumer needs, wants, desires, and aspirations, the emotional appeals, symbols, and persuasive approaches Reconciling an international advertising campaign with the cultural uniqueness of markets is the challenge confronting the international or global marketer

16-15 International Advertising 1.Perform marketing research 2.Specify the goals of the communication 3.Develop the most effective message(s) for the market segments selected 4.Select effective media 5.Compose and secure a budget 6.Execute the campaign 7.Evaluate the campaign relative to the goals specified

16-16 Advertising Strategy and Goals Marketing problems  Require careful marketing research  Thoughtful and creative advertising campaigns ► In country, regional, and global markets Increased need for more sophisticated advertising strategies Balance between standardization of advertising themes and customization Consumer cultures  Related to shared sets of consumption-related symbols, such as convenience, youth, American, internationalism and humanitarianism.

16-17 Product Attributes and Benefit Segmentation Different cultures usually agree on the benefit of the primary function of a product or service Other features and psychological attributes of the item can have significant differences  Cameras  Yogurt  Almonds Blue Diamond  Assumes that no two markets will react the same ► Each has its own set of differences ► Each will require a different marketing approach and strategy

16-18 Regional Segmentation Pan-European communications media highlights need for more standardized promotional efforts Costs savings with a common theme in uniform promotional packaging and design Legal restrictions slowly being eliminated

16-19 Case: Office Table

16-20 Case: Video ads Case: Video ads

16-21 Global Advertising and the Communications Process If not properly considered, different cultural contexts can increase the probability of misunderstandings Effective communication  Demands the existence of a “psychological overlap” between the sender and the receiver It can never be assumed that “if it sells well in one country, it will sell in another”

16-22 The International Communications Process Exhibit 16.4

16-23 Legal Constraints Comparative advertising Advertising of specific products Control of advertising on television Accessibility to broadcast media Limitations on length and number of commercials Internet services Special taxes that apply to advertising

16-24 Linguistic Limitations Language is one of the major barriers to effective communication through advertising Translation challenges Low literacy in many countries Multiple languages within a country In-country testing with the target consumer group avoids problems caused by linguistic differences

16-25 Cultural Diversity Knowledge of cultural diversity must encompass the total advertising project Existing perceptions based on tradition and heritages are often hard to overcome Subcultures Changing traditions

16-26 Media Limitations and Production and Cost Limitations Media limitations may diminish the role of advertising in the promotional program Examples of production limitations:  Poor-quality printing  Lack of high-grade paper Low-cost reproduction in small markets poses a problem in many countries

16-27 Media Planning and Analysis – Tactical Considerations Availability Cost Coverage Lack of market data

16-28 Media Planning and Analysis – Tactical Considerations Newspapers Magazines Radio and television Satellite and cable TV

16-29 Media Planning and Analysis – Tactical Considerations Direct mail The Internet The New Social Media  Word-of-mouth (WOM)  Social networking, blogs, virtual workds, and video sharing, etc. Other media  Billboard, cinema, private car, etc.

16-30 Media Penetration in Selected Countries (per 1,000 persons) Exhibit 16.5

16-31 Top Ten Websites in Three Countries (visitors per month) Exhibit 16.6

16-32 Social Networking Goes Mobile (Percent of Respondents) Exhibit 16.7

16-33 Campaign Execution and Advertising Agencies Managed by advertising agencies  Local domestic agency  Company-owned agency  Multinational agency with local branches Compensation  Commonly 15 percent throughout the world  Some companies moving to reward-by-results

16-34 World’s Top Ten Advertising Agency Organizations Exhibit 16.8

16-35 International Control of Advertising – Broader Issues Consumer criticism Deceptive advertising Decency and blatant( 公然 ) use of sex Self-regulation Government regulations

16-36 Summary An integrated marketing communications (IMC) program includes coordination among advertising, sales management, public relations, sales promotions, and direct marketing Currently companies are basing their advertising strategies on national, subcultural, demographic, or other market segments The major problem facing international advertisers is designing the best messages for each market served

16-37 Summary The availability and quality of advertising media vary substantially around the world Advances in communication technologies are causing dramatic changes in the structure of the international advertising and communications industries