Integrated Marketing Communication Strategy PRINCIPLES OF MARKETING Eighth Edition Philip Kotler and Gary Armstrong Chapter 14 Integrated Marketing Communication Strategy

The Marketing Communications Mix This CTR relates to the material on pp. 422-423. The Marketing Communications Mix Advertising Personal Selling Any Paid Form of Nonpersonal Presentation by an Identified Sponsor. Tools of The Marketing Communications Mix Advertising. Advertising is any paid form of nonpersonal presentation and promotion of ideas, goods, or services by an identified sponsor. Advertising often utilizes mass media and may be adapted to take advantages of a given mediums strengths to convey information. Sales Promotion. Sales promotions consist of short-term incentives to encourage purchase of sales of a product or service. Limited time offers or dated coupons are common sales promotions. Public Relations. Public relations is an on-going process of building good relations with the various publics of the company. Key elements in the process are obtaining favorable publicity, building and projecting a good "corporate image," and designing an information support and response team to respond proactively to unfavorable rumors, stories, or events. Personal Selling. Personal selling describes the use of oral presentations in a conversation with one or more prospective buyers for the purposes of making a sale. Personal selling combines product information and benefits with the interpersonal dynamics of the sales person. Good interpersonal relationship skills and effective oral communication skills are needed for personal selling. Direct Marketing. Directed communications with carefully targeted individual consumers to obtain an immediate response. Personal Presentations by a Firm’s Sales Force. Sales Promotion Short-term Incentives to Encourage Sales. Building Good Relations with Various Publics by Obtaining Favorable Unpaid Publicity. Public Relations Direct Communications With Individuals to Obtain an Immediate Response. Direct Marketing

Noise Noise Noise Noise Noise Noise The Communication Process This CTR corresponds to Figure 14-1 on p. 424 and relates to the material on pp. 423-425. The Communication Process Sender Noise Noise Noise Noise Noise Noise Encoding Feedback Media The Communication Process Sender. The sender is one of two major parties in communication. It is the sender who decides how to encode a message aimed at a particular target market or receiver. Senders need to anticipate what information receivers need and how receivers will interpret different kinds of information. Receiver. The receiver in marketing communication is the target market or audience. Receivers not only "accept" information; they process and act on it according to their own needs. Message. The message is the information content about product benefits transmitted by the sender as a set of symbols whose meaning is generally understood by other senders and receivers. Media. The media are the means by which messages move from senders to receivers. Mass media such as television and radio are examples. These are also called communication channels. Encoding. Encoding is the process of putting the sender's message into a symbolic form capable of being carried by the selected media of transmission. Decoding. Decoding is the process by which the receiver assigns meaning to the transmitted message. Marketers must remember that this is an interpretative activity and may use different ways of assigning meaning than the sender used in encoding the message. Response. Responses are reactions and can include behavioral changes, attitude changes, or no indications of change. Feedback. Feedback consists of the part of the consumer's response that is communicated back to the sender. Feedback is a valuable but incomplete picture of the consumer's response to the marketing communication. Noise. Noise is any distortion during the transmission process and is always present to some degree. Noise also occurs in the feedback stage. Message Decoding Response Receiver

Steps in Developing Effective Communication Step 1. Identifying the Target Audience Step 2. Determining the Communication Objectives Buyer Readiness Stages Steps in Developing Effective Communication Awareness Knowledge Liking Preference Conviction Purchase

Step 3. Designing a Message Steps in Developing Effective Communication Designing a Message This CTR relates to the discussion on p. 426-428. Choosing a Message Marketers must make decisions in several areas when choosing or creating a message, include areas related to Message Content, Message Structure, and Message Format. Key message content decisions include one of three types of appeals: Rational Appeals. These relate to the audience’s self-interest. Rational appeals are grounded in objective, logical reasons for purchasing a product such as improved performance, increased quality, better reliability, and increased productivity. Emotional Appeals. These attempt to elicit either positive or negative feelings that will facilitate a purchase. Moral Appeals. These are directed to the consumer’s sense of right and wrong and are often used in conjunction with the marketing of social causes. To be effective, marketers must very narrowly and very accurately target their consumer market. Moral appeals may work extremely well with groups that share the same morals, but will very likely outrage groups whose moral values differ from those in the message. Message Structure Marketers deal with three message structure issues. Conclusions. First, marketers must decide whether or not to draw a conclusion in the message. Effectiveness depends upon both the nature of the information being communicated and the relative level of experience with the product concept on the part of the audience. Argument Type. Second, marketers must decide on the type of argument to be used: One-sided arguments or Two-sided arguments . Argument Order. Third, argument order must be decided. When many arguments are being used, placing the strongest argument either first or last can affect persuasiveness. Marketers must also make message format decisions. Format issues involve sensory qualities, color in visual ads, sound in radio, and effective use of novelty and contrast in the message. Message Content Rational Appeals Emotional Appeals Moral Appeals Message Structure Draw Conclusions Argument Type Argument Order Message Format Headline, Copy, Color, Words, & Sounds, Body Language Attention Interest Desire Action

Steps in Developing Effective Communication Step 4. Choosing Media Steps in Developing Effective Communication Choosing Media This CTR relates to the discussion on pp. 429-432. Step 5. Selecting the Message Source Choosing Media Personal Communication Channels. Personal channels involve two or more people in direct communication. Strategic usage of personnel communication channels should consider the following influences: Word of Mouth. Word of mouth is especially credible to consumers -- either positive or negative. Opinion Leaders. Opinion leaders are people whose opinions on products are sought by others. Marketers can make use of and even create opinion leaders for consumer’s reference. Discussion Note: Is it ethical to create opinion leaders, especially fictional ones? For example, Mr. Goodwrench of General Motors is not a real person and his genuine GM parts lack quality control as many of them aren’t really made by GM, but by overseas suppliers. Nonpersonal Communication Channels. Nonpersonal channels are characterized by an impersonal method of communication, which lacks the face to face interactive nature of personal channels or feedback. Major forms of nonpersonal communication include: Major media include print, broadcast and display. Atmospheres are designed environments that create or reinforce the buyer’s leanings to buy a product. Events are occurrences staged to communicate messages to target audience. Personal Communication Channels Nonpersonal Communication Channels Step 6. Collecting Feedback

Setting the Total Promotion Budget This CTR relates to the material on pp. 432-433. Setting the Total Promotion Budget Percentage- of-Sales Method Affordable Competitive- Parity Objective- and-Task Setting the Total Promotion Budget Affordable Method. This method involves setting a promotion budget based upon what management thinks the company can afford. This method often places promotion budget decisions in the hands of managers unfamiliar with what promotion does for the product. It also ignores the effect of promotion on sales volume and/or possible value-added to the product in the mind of the consumer by the promotion effort. Percentage-of-Sales Method. This method sets promotion budgets at a certain percentage of current or projected sales or price of the product. While it does link sales and promotion together it tends to make promotion an effect of sales rather than a positive influence on it. Also, falling sales under this method will decrease promotional expenditures which might need to be increased to halt the sales decline. Competitive-Parity Method. This method sets promotion budgets in line with what the competition spends on promotion. This "collective wisdom" philosophy suggests that management is unwilling or unable to decide what level of spending is needed to promote the product to the consumer. Objective-and-Task Method. This method sets budgets by defining specific objectives, determining what tasks are necessary to meet them, estimates the cost of performing the tasks, and sets the promotion budget according to the estimates. In approach assumes that promotion is a resource to be allocated to meet company goals and managed proactively to compete successfully.

Setting the Promotion Mix Advertising Reaches Many Buyers, Expressive Impersonal Setting the Promotion Mix This CTR relates to the material on pp. 433-435. Setting the Promotion Mix Personal Selling Personal Interaction, Builds Relationships Costly Nature of Each Promotion Tool Sales Promotion Provides Strong Incentives to Buy Short-Lived Public Relations Believable, Effective, Economical Underused by Many Companies The Nature of Each Promotion Tool Advertising. Advertising’s public nature helps legitimize the product. It also allows marketers to repeat the message to a wide audience. Large-scale campaigns communicate something positive about the seller’s size, popularity, and success. Advertising is also very expressive and can make use of powerful symbols and sensory appeals. Its shortcoming include expense, one-way communication, being impersonal, and lack of control over situational reception. Personal Selling. Personal selling is the most effective promotion tool at certain stages in the buying process, especially in building preferences, convictions, and actions. The personal contact is two-way and allows adaptation to buyer reactions and the establishment of relationships. Personal selling is also the most expensive promotion tool and requires a long-term commitment to build an effective salesforce. Sales Promotion. Sales promotion includes coupons, contests, cents-off deals, premiums, rebates, and other techniques designed to elicit a quick response. Sales promotions usually influence the timing of a purchase rather than the decision to purchase. Public Relations. Public relations includes news stories, features, and reporting on company activities from objective and credible third-party sources. These events are perceived as more believable than company-controlled promotions. Difficulties include the lack of message content, format, and structure control over the public relations event. Further, public relations are generally under used by marketers both strategically and tactically. Direct Marketing. Direct marketing includes such things as direct mail, telemarketing, electronic marketing, online marketing, and others. Direct Marketing Nonpublic, Immediate, Customized, Interactive

Factors in Developing Promotion Mix Strategies This CTR relates to the material on pp. 435-437. Factors in Developing Promotion Mix Strategies Push Strategy - “Pushing” the Product Through Distribution Channels to Final Consumers. Pull Strategy - Producer Directs It’s Marketing Activities Toward Final Consumers to Induce Them to Buy the Product. Factors in Setting the Promotion Mix Push or Pull Strategy. The promotion mix is also affected by the company's decision on either a push or pull strategy. Push strategies rely on personal selling and sales promotions to encourage intermediaries to take the product and promote, thus "pushing" it through the channel. Pull strategies rely on advertising and consumer promotions to build up demand in the target market of ultimate consumer whose behavior effectively "pulls" the product through the channel. Type of Market. The type market, consumer or industrial, varies the importance of the promotion tools available to marketers. Advertising weighs heavily in consumer markets whereas personal selling plays the greatest role in industrial markets. Buyer Readiness State. The buyer will be more receptive to some promotion tools than others depending upon their particular buyer readiness state. Advertising and public relations help create awareness and increase knowledge. Liking and preference are more affected by personal selling and advertising together. Conviction and purchase come first from advertising and then personal selling to close depending upon the kind of product being considered. Product Life Cycle Stage. The stage in the product life cycle also describes different appropriate promotion mix variations. Introduction utilizes advertising and public relations to build awareness and personal selling to facilitate motivate channel members to carry it. In growth, the need for personal selling diminishes. In maturity, personal selling helps differentiate it again in distribution. In decline, sales promotion may be the most emphasized of the promotion mix tools. Type of Product/ Market Product Life-Cycle Stage Buyer/ Readiness Stage

Changing Face of Marketing Communications New Marketing Communications Realities Changing Face of Marketing Communications Marketers Have Shifted Away From Mass Marketing Less Broadcasting Improvements in Information Technology Has Led to Segmented Marketing More Narrowcasting

Integrated Marketing Communications Company Carefully Integrates and Coordinates Its Many Communication Channels to Deliver a Clear, Consistent, Compelling Message. Packaging Advertising Event Marketing Personal Selling Message Direct Marketing Sales Promotion Public Relations