Integrated Marketing Communications and International Advertising

Learning Objectives 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 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

Global Perspective Barbie Versus Mulan Integrated marketing communications (IMC) Advertising Sales promotions Trade shows Personal selling Direct selling Public relations Objective: the successful sale of a product or service

International IMC Quicksilver Skateboards using Alternative Touch Points throughout Asia

Sales Promotions in International Markets Marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation Short-term efforts directed to the consumer or retailer to achieve specific objectives In markets with media limitations the percentage of the promotional budget allocated to sales promotions may have to be increased Product sampling

International Public Relations Bridgestone/Firestone Tires safety recall Global workplace standards Building an international profile Corporate sponsorships The role of 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.

International Advertising Perform marketing research. Specify the goals of the communication. Develop the most effective message(s) for the market segments selected. Select effective media. Compose and secure a budget. Execute the campaign. Evaluate the campaign relative to the goals specified.

Top 20 Global Advertisers ($ millions) Insert Exhibit 16.1 Advertising Age 2005

Top 100 Global Advertisers ($ millions) Total Global Spending 2003 vs 2002 Advertising Age 2005

Top 10 Russian Advertisers ($ millions) Growth of Advertising in Russia Advertising Age 2005

Top 10 Chinese Advertisers ($ millions) Growth of Advertising in China Advertising Age 2005

Advertising Strategy and Goals Marketing problems require careful marketing research and thoughtful and creative advertising campaigns in country, regional, and global markets, respectively. Increased need for more sophisticated advertising strategies. Balance between standardization of advertising themes and customization. Consumer cultures

Advertising Strategy and Goals Vehicular Ads in London Are Visible Even in Fog

Product Attributes and Benefit Segmentation Different cultures usually agree on the benefit of the primary function of a product 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, that each has its own set of differences, and that each will require a different marketing approach and strategy

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

Global Advertising and the Communications Process If not properly considered, the 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”

The International Communications Process Insert Exhibit 16.4

Red Works

What’s in a Word…California? Southern California Lifestyle Meets 11th Century Islam (Out of Home Advertising in Singapore)

Legal Constraints Laws that control comparative advertising vary from country to country in Europe. 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

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

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

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

Media Planning and Analysis – Tactical Considerations Availability Cost Coverage Lack of market data Newspapers Magazines

Media Planning and Analysis – Tactical Considerations Media Penetration in Selected Countries Per 1000 Persons Euromonitor, World Bank, 2005

Media Planning and Analysis – Tactical Considerations Local Restrictions or Lack of Availability Spawn Other Media Vehicles

Media Planning and Analysis – Tactical Considerations (continued) Radio and television Satellite and cable TV Direct mail The Internet Other media

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

Campaign Execution and Advertising Agencies Top 10 Advertising Agency Organizations Advertising Age 2004

International Control of Advertising: Broader Issues Advertising/Consumption – Cause/Effect?

International Control of Advertising: Broader Issues Consumer criticism Deceptive advertising Decency and blatant use of sex Self-regulation Government regulations

Microsoft Corporate Branding/Image Campaign United States Mexico Japan

Microsoft Korea United States Product Specific Advertising France

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. 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.