CHAPTER 12 Connecting with the Customer: Integrated Marketing Communications and Interactive Marketing M A R K E T I N G Real People, Real Choices Fourth Edition

12-2 How Many Can You Answer? Name the tiger that says, “They’re grrrrrreat!” Name one or more products for which Tiger Woods is a spokesperson. What character is featured in Energizer battery ads? At Burger King, you can have it “ ___,” whereas at Hardee’s the burgers are _____.

12-3 Functions of Marketing Communications Inform –“A tree fell in the forest. Did it make a sound?” Persuade –Prefer one brand over another Remind –Consumers have short memories Build relationships –Retaining old customers is cheaper than getting new customers Continuous communication to build relationships

12-4 The Communication Model The sender (business) encodes the idea into a message Uses a medium to communicate the message The receiver (consumer) decodes the message back to the idea Noise as interference in the encoding and decoding of message Feedback from receiver (consumer)

12-5 Traditional / Non-traditional Forms The Promotion Mix –Advertising –Sales promotion –Special events –Salespeople –PR –Direct Marketing/Mail –Billboards –Posters, brochures, flyers –Train transfers/bus transfers Product Placements –Movies and TV shows –Books, Plays, Works of Art (Andy Warhol) Viral Marketing Guerilla Marketing Infomercials Corporate gifts Other non-traditional forms

12-6 Mar Com Matrix FactorAdvertisingPREventsDRSPPlacements Intensity of effect LowModHigh Effect duration ShortMod Short Mod ControlTotalLowHigh Mod Ability to target HighLowModVery highModLow Customizabil- ty of message ModLowLow-highHighLow-highMod CredibilityLowHighModLowModHigh Closes saleLow ModHighMod Greatest application Broad,,large TA Credibil ity is vital ImageUnique consumer needs Encourag e Trial Discourage attributions

12-7 Role of IMC Promotion is communication by marketers that informs, persuades, reminds, and builds relationships with potential buyers of a product to influence an opinion or elicit a response IMC is a plan for optimal use of the elements of promotion

12-8 Putting It All Together Integrated Marketing Communications (IMC) is “a strategic business process used to plan, develop, execute, and evaluate unified, coordinated, measurable, persuasive brand communication programs over time with consumers, customers, prospects, and other targeted, relevant external and internal audiences.”

12-9 Appeals Personal appeals allow for direct interaction between a company representative and a customer Mass appeals seek to reach many prospective customers at the same time

12-10 New Appeals Guerrilla marketing –“ambush” consumers in unexpected places Viral marketing –Customers act as selling agents against some consideration Buzz (word of mouth generated by customers which is considered authentic) and hype (propaganda planted by companies; not seen as authentic)

12-11 Advertising Non-personal communication from an identified sponsor using the mass media can: –convey rich and dynamic images –establish and reinforce brand identity –communicate factual information –remind customer to buy Credibility issues

12-12 Sales Promotion Programs that build interest or encourage purchase of a product through the use of an incentive in a specified time period –coupons –contests –rebates –premiums

12-13 Publicity and Public Relations Portray an organization and its products positively by influencing the perceptions of various publics –writing press releases –holding special events –conducting and publishing consumer surveys –putting a positive spin on negative news

12-14 Characteristics of an IMC Program Creates a single unified voice Begins with the customer Seeks to develop relationships Involves 2-way communication Focuses on stakeholders Generates a continuous stream of communication Measures results based on actual feedback

12-15 Step 2: Establish Promotion Objectives Objectives will change depending on where consumers are on the path to loyalty Possible objectives –create awareness (repetitive ads, slogans, jingles) –inform the market (detailed copy, infomercials, brochures, website) –create desire (status and sex appeals, celebrity endorsements, product placement) –encourage trial (sales promotions like discounts, free samples, etc.) –build loyalty (direct mail, website)

12-16 Step 3: Determine Total Promotion Budget Top-down budgeting techniques –percentage-of-sales method During periods of slow sales, you may risk reducing your advertising –competitive parity Specific initiatives are ignored Bottom-up budgeting technique –objective-task method Sometimes difficult to accurately estimate costs

12-17 Push vs. Pull strategy Push –Pushing consumers to buy (hard-sell approaches) –Pushing the channel to sell (discounting, rebates and other price-offs) Pull –Relying on the power of the brand name to bring in the customers (image advertising and some sales promotions, PR, placements, etc.)

12-18 Effects of Time and the PLC Introduction phase: push strategy; mix relies heavily on advertising, sales promotions, and public relations Growth phase: heavy advertising with emphasis on differentiation Maturity phase: emphasis on sales promotions to encourage brand switching Decline phase: dramatic reductions in promotional spending

12-19 Step 4: Designing the Promotion Mix Which elements of promotion will be used? What message is to be communicated? –Type of appeal? What communication channels should be employed?

12-20 The AIDA Model Attention Interest Desire Action

12-21 Step 5: Evaluate the Effectiveness Is the plan working? –Measure response to sales promotions –Measure brand awareness, recall, and image before and after ad campaign –Analyze and compare sales performances by territory and sales force –Clip articles appearing in media

12-22 Interactive Marketing Attention Economy –The amount of information seems infinite; our ability to get it is limited by the time we can spend looking –Interactive media are in the business of making wanted information easily accessible Customized marketing communications yield a measurable response in the form of a purchase or request for more information

12-23 Levels of Interactive Response First-order response: product offer directly yields a transaction Second-order response: product offer results in some form of customer feedback but it isn’t a transaction –request for more information –request NOT to receive more information

12-24 Database Marketing Critical to interactive marketers as they seek to track responses to messages and develop a dialogue with customers Allows the organization to learn customer preferences, fine-tune and test offerings, build relationships

12-25 Database Marketing Is interactive Builds relationships Locates new customers Stimulates cross-selling Is measurable Is trackable