12-1 Chapter 12- Promotion Strategy and IMC  Promotion: The coordination of marketing communication efforts to influence attitudes or behavior  Marketing communications purpose: –Inform –Remind –Persuade –Build relationships

12-2 Traditional Forms: The Promotion Mix  Advertising  Sales promotion  Personal selling  PR (and special events) –Publicity  Direct Marketing (per this text)

12-3 Integrated marketing communication (IMC):  Process that marketers use to plan, develop, execute, and evaluate coordinated, measurable, persuasive brand communication programs over time to targeted audiences –Consumers see the variety of messages from a firm as a whole  Coordinated, consistent messages across all media (advertising, Website, etc.) *

12-4 Figure Communication Model

12-5 Marketer Control over the Elements in the Promotion Mix –The extent of the marketer’s control over different communication elements varies – Control varies inversely with credibility! – Represents a trade-off for marketers

12-6 Mass Appeals: reach many customers at once  Advertising: Nonpersonal communication from an identified sponsor using mass media –Provides marketers with total control –Rich and dynamic advertising images can help to build or reinforce brand image –May provide factual information or offer reminders to consumers –Lacks credibility with cynical consumers –Can be expensive

12-7 Mass Appeals  Sales promotion: Contests, coupons, and other incentives designed to build interest or encourage product purchase during a specified period –Provides retailers with incentives to support a brand –Builds retailer and consumer excitement –Encourages immediate purchase and trial –Reaches price-sensitive consumers –Does not focus on building brand loyalty –Promotional clutter is hard to break through

12-8 Mass Appeals  Public relations: Communication activities that create or maintain a positive image (“goodwill”*) of a firm and its products  Publicity: ‘News’ that attracts the attention of the public usually via media (newspapers, magazines, television new programs, etc.) Viewed as coming FROM the media. –With respect to publicity in particular: Relatively low cost Highly credible Poor message control; no guarantee that message will even reach the intended target Can be difficult to track results

12-9 Personal Appeals: Communicate on an individual level  Personal selling: Direct interaction between a company representative and a customer –Flexible; salespeople can modify the message to match customer needs –Immediate feedback is available to sales rep –High cost per contact –Difficult to ensure message consistency between different sales representatives

12-10  Direct marketing: Efforts to gain a direct response from an individual consumer –Easily target specific customers with different offers –Easily measure results –Can provide extensive information and multiple offers with a single appeal –Facilitates marketing database information collection –Consumers dislike some forms of direct marketing –Higher cost per contact than mass appeals

12-11 Buzz Appeals  Word-of-mouth (WOM) marketing: –Efforts by a company to stimulate customer word-of- mouth (activities that give people a reason to talk about the product)  Buzz marketing: –Using high-profile entertainment or news that gets people to talk about the brand  Viral marketing: –Creating entertaining or informative messages to be passed along

12-12  Guerrilla marketing: –Activities that “ambush” consumers with promotional content in places they are not expecting to encounter this kind of activity  Experiential marketing: –Marketing activities that attempt to give customers an opportunity to actually interact with a brand  Consumer-generated media: –The online consumer-generated comments, opinions, and product-related stories available to other consumers through digital media

12-13 Ethical Issues in Buzz Marketing  Ethical problems in buzz marketing can occur when: –Activities are designed to deceive consumers –Specifically directing buzz marketing at children or teens –Buzz marketing activities damage property –Stealth marketing activities deliberately deceive or lie on behalf of clients –Shilling, comment SPAM, or SPAM is used

12-14 Integrated Marketing Communication (IMC)  With IMC, marketers plan and execute communication programs that create and maintain long-term relationships with customers by satisfying needs –IMC unifies all marketing communication tools to send a consistent, persuasive message –IMC is becoming increasingly important because…

12-15 Characteristics of IMC –Begins with the customer –Creates a single unified voice for firm –Seeks to develop relationships with customers through one-to-one marketing and tiering and “share of customer” –Relies on two-way communication –Focuses on stakeholders and customers –Generates continuous communication –Focuses on changing behavior: Measures results (marketing ROI)

12-16 IMC and Database Marketing  IMC efforts rely on marketing databases  Database marketing: –The creation of an ongoing relationship with a set of customers who have identifiable interest in a product –Customers’ responses become part of the ongoing communication process

IMC and Database Marketing  Database marketing: –creation of ongoing relationship with a set of customers who have identifiable interest in a product  Customers’ responses become part of ongoing communication process –Is interactive –Locates new customers –Is measurable –Builds relationships –Stimulates cross-selling –Yields trackable responses

12-18 Figure Steps to Develop an IMC Plan

12-19 Developing the IMC Plan  Step 1: Identify target audiences –Always 1 st step as it drives all other decisions  Step 2: Establish the communication objectives –Create awareness –Inform the market –Create desire –Encourage purchase and trial –Build loyalty

12-20 Figure The Hierarchy of Effects

12-21  More simplistic version of previous slide –A = Attention (Awareness) – I = Interest (Knowledge) –D = Desire (same as chart – Desire) –A = Action (Purchase) AIDA Principle

12-22  Step 3: Determine and allocate the marketing communication budget –Determine the total promotion budget Ideally determined based on what is needed vs. what is available or choosing an arbitrary number –Decide on a push or pull strategy Push strategy: firm moves products through the channel by convincing channel members to offer them Pull strategy: firm moves products through the channel by building desire among consumers, convincing retailers to respond to demand –Allocate budget to a specific promotion mix Developing the IMC Plan

12-23  Step 4: Design the promotion mix –Type of appeal Rational appeal: product-focused; factual/technical information; “reason why” Emotional appeal: focus on customer lifestyle; emotional response to product usage/outcomes (see other types of appeals in Ch. 13) –Communication channel (See media in Ch. 13) Developing the IMC Plan

12-24  Step 5: Evaluate the effectiveness of the communication program  For sales promotion –Measure sales response  For advertising –Measure brand awareness, recall, and image before and after ad campaign  For personal selling –Analyze and compare sales performances by territory and sales force  For publicity: – Clip articles appearing in media