1 Lecture Takeaways Understand promotions as a element of marketing and the rising importance of advertising and promotion tools in a company’s marketing programme. Appreciate the concept of IMC, its evolution and significance in bringing together individual promotion tools. Realise how various communication tools work together in a coordinated manner to communicate effectively.

2 Lecture 1 Marketing Relationship Marketing Marketing Mix Promotion Communication Why IMC? Reasons for Growing Importance of IMC Role of IMC in Branding

3 Marketing American Marketing Association defines In order to create Exchange that satisfy individual and organisational objectives Marketing Planning Execution Conception Pricing Promotion Distribution Ideas Goods Services

4 Marketing involves various activities Inbound marketing activities –Market Research Outbound marketing activities –Advertising and Promotion –Sales –Public and Media Relations –Customer service –Customer satisfaction There is interdependence of these activities.

5 Relationship Marketing Today most marketers are seeking more than just one time exchange or transaction with customers. Customers desire superior customer value –Quality product and services –Competitively priced –Convenience to purchase –Timely delivery –Excellent customer service –Personalised products and service Mass Customisation – Computers, Clothing, Cosmetics, Jewelry.

6 Relationship Marketing cont… It is often more cost effective to retain customers than to acquire new one. Lifetime Value of customers Reducing customer defections by just 5 percent can increase future profit by as much as 80 to 90 percent.

7 Marketing Mix Product Price Place Promotion –Combine these four elements into a marketing programme to facilitate the potential of exchange with customers in the market place. –Marketer must be aware how each of these elements can be combined to provide effective marketing programme. –Eg:-failures Kellogg’s cornflakes

8 Marketing Communication MC involves all activities concerned with effectively communicating product information to selected target audience. All MC is done with a purpose. The prime Purpose of communication is to seek a Cognitive, Affective and Behavioural response whatever the desired response may be.

9 The growth of advertising & promotions (India) YearAdvertising expenditure (Rs. Crores) % Growth over last year , , , , , ,329

10 Marketing Mix: Product or Service Pricing Channels of Distribution Promotion Promotional Mix: Advertising Direct Marketing Interactive/internet marketing Sales Promotion Publicity/Public Relations Personal Selling

11 Corporate Level Message Sources Administration Manufacturing/ Marketing Finance Human Legal Operations Resources Cross-Functional Brand Equity (IM) Team Marketing Level Message Sources Product Price Marketing Distribution Mix Mix Communication Mix Cross-Functional IMC Team Marketing Communication Level Message Sources Personal Adver- Sales Direct Public Pack- Events Sales tising Promotion Marketing Relations aging Interactivity Other Stakeholders Employees Investors Financial Community Government Regulators Customers Distributors Suppliers Competition Consumers Local Community Media Interest Groups Communication-Based Marketing Model

12 High control Message Low control Message Advertising Sales-Promotion Direct Marketing Special Events Publicity PR Crisis Management Employee- Behaviour Consumer WOM

13 Evolution of IMC American Association of Advertising Agencies defines IMC as “a concept of marketing communication planning that recognises the added value of a comprehensive plan that evaluates the strategic roles of a variety of communication discipline- for example general advertising, direct response, sales promotion,and public relations and combines these disciplines to provide clarity, consistency and maximum impact.”

14 Integrated communication for Incredible India

15 IMC called by different names… New advertising One-to-one marketing Whole egg Orchestration 360 branding Total branding

16 Evolution of IMC condt… Concept of IMC was first germinated in 1980 Communication originating from watertight compartments overlapped, managers competed internally for resources and the common goal of the organisation was sidelined in the bid to secure maximum resources. Hence IMC was born…to look at the common organisation goal

17 Shift in the agencies too Eg- Ogilvy & Mater (O&M) now offers 360 degree communication option to the clients –Ogilvy Activation for out-of-home communication –Ogilvy Interactive for online marketing –Ogilvy Live for events and promotions –Ogilvy PR for public relations –Ogilvy One for one-to-one marketing –Ogilvy Signscapes for retail design solutions.

18 Reasons for growing importance of IMC Decreasing impact of tradition advertising Proliferation of new ways to reach consumers Demand greater accountability Growth in database marketing Growth of international marketing Emphasis on relationship marketing Tighter control over communication Changing compensation structure of agencies Need for single brand custodian Need for creating brand identity

19 Branding and Brand equity Brand-is a collection of images and ideas regarding a productor company. More particularly it refers to the concrete symbols such as brand name, logo, slogans, signs, symbols and design schemes. Brand recognition- is the result of awareness regarding a brand in the marketplace and is created by direct experiences with a product or through other communications Brand equity- is the power and value of a brand in the marketplace. It is based on brand loyalty, brand awareness, perceived quality, strong brand associations, patents, trademarks etc.