IMC Partners & Industry Organization LECTURE-21 IMC Partners & Industry Organization

Chapter Questions Who are the IMC partners? How is the agency world organized? How do media partners fit in? Behind the message is the company (client) How does the agency/client relationship work?

Chapter Perspective: Changing World Old World New World Marketing Communications Dominated by Advertising Agencies More Use of Other Marketing Communications Functions Focus on mass media Willingness to consider other media to reach consumers

Opening Case: Phelps Group +

Opening Case: Phelps Group Challenge: Answer: Results: Get feedback for the agency’s work “The Wall” of ideas Surveys of clients, suppliers, and employees “Wallbangers” and “BrainBanger’s Balls” Recognized as a very creative agency Impressive client list: Petco, Whole Foods, Panasonic

Three Players in the Golden Triangle

IMC in Action: Mall of America

IMC In Action: Mall of America Challenge: Answer: Results: Promote Mall of America’s 10th anniversary An IMC campaign featuring: The theme: “Celebrating a decade of fun” Effort to involve as many media partners as possible USA Today front page story CBS Sunday Morning piece AP story carried by 30 newspapers

1st Part of Golden Triangle: The Agency

Most Common Types of Agencies Advertising Advertising Direct Marketing Direct Marketing Sales Promotion Events Events Agencies Relationship Marketing Relationship Marketing IMC IMC Public Relations Packaging Public Relations Packaging

Tales From the Real World In an attempt to attract new clients, some ad agencies have jumped on the IMC bandwagon and now position themselves as “IMC agencies.” In the real world, it’s important to look deeper: some of these agencies simply say they can handle IMC but really don’t have the organization or experience to adequately address all the IMC functions

2nd Part of Golden Triangle: The Media

Media Depend on Outside Sources To make a profit Advertisers Content To fill time and space: TV and radio: programming Newspaper: news and features

Ultimate form of integration: Disney Disney Store Logo Disney World Logo Disney Online ABC Logo Media Integration @ Disney Touchstone Pictures Logo Disney Channel Logo Fox Kids Logo ESPN Logo

3rd Part of Golden Triangle: Companies

Two Types of Marketing Efforts B2B B2C

Some Firms Do Both: Nike B2B Nike’s Relationship with shoe retailers like Foot Locker B2C Niketown stores selling shoes directly to consumers

Example of Centralized Control

Example of Decentralized Control +

Agency/Media/Company Compensation Commission: A payment that represents a percentage of a client’s total media spending Cost of media advertising: Rs. 5 million (100%) Amount agency bills to client: Rs. 5 million (100%) Amount agency pays media Rs. 4.25 million (85%) Amount agency keeps Rs. 750,000 (15%) Commission = Rs. 750,000

IMC Planning Starts at Zero Zero-based planning A process that determines objectives and strategies based on current brand and marketplace conditions

Tales From the Real World In the real world, many organizations pay lip service to “zero-based” planning or ignore it completely. Why? It’s human nature. It is simply much easier and less time consuming to find last year’s plan, dust it off, make a few minor changes, and present it as a new plan. There’s only one problem: last year’s SWOTs may no longer apply. As a result, the new plan may be addressing old issues—and wasting marketing dollars.

Reasons for IMC Planning Provides a Rational Process Provides a Rational Process Informs Everyone of Expectations Informs Everyone of Expectations IMC Planning Reasons Ensures That the Program Is Integrated Ensures That the Program Is Integrated Helps Identify Budget Creates a Benchmark for Measuring Results Helps Identify Budget

Where it Fits in the Organization Business Plan: Focused on the profits and brand equity Corporate Level Department Plan: Marketing operations/ production, human resources Department Level MC Level IMC plan: Advertising, publicity, sales promotion, events and sponsorships, direct response

Insight: Cross-Functional IMC Teams Some basic principles for managing cross-functional teams: Long-term focus: Keep team members in place for an extended period rather than assembling them for ad hoc projects Constant contact: Frequent meetings are important; however, members can also keep in constant contact via email Work space: Assigning a cross-functional team its own work space helps keep team members informed Support from the top: Top management must support the idea of cross-functional planning by providing adequate resources

Final Note: IMC is driving the need for closer agency-client relationships Fallout: some marketers are consolidating their relationships with fewer agencies IBM cut 70 agencies from its $500 million account

Bibliography Marketing Management – A South Asian Perspective by Philip Kotler, Kevin Lane Keller, Abraham Koshy & Mithileshwar Jha, 13th Edition, Published by Pearson Education, Inc. Strategic Marketing Management – Meeting The Global Marketing Challenges by Carol H. Anderson & Julian W. Vincze Published by Houghton Mifflin Company. Principles of Advertising & IMC by Tom Duncan 2nd Edition, Published by McGraw-Hill Irwin. Principles of Marketing by Philip Kotler & Gary Armstrong Thirteenth Edition, Published by Prentice Hall

The End: "Never worry about numbers. Help one person at a time, and always start with the person nearest you." - Mother Teresa