The Global Marketing Communications (2) Compiled by: Sunarto Prayitno

2 3. Marketing Communications System

3 Factors Impacting Consumer Behavior Verbal to Visual Functional Illiteracy Facts to Perceptions Media Fragmentation Outcome: Demassification of Markets

4 The Life-style Trend Convenient Trend Quality Trend Personality Trend Health/natural Trend

5 Media Fragmentation Media Mass Media Interpersonal Media Interactive Media Print Television Radio Face-to-face Group Internet, Intranet, Extranet New Media

6 Communication Strategies Cognition Affection Conation Soft-sell Hard-sell Advertising Public Relations Sales Promotion Interactive Marketing Direct Marketing Personal Selling Experiential Marketing CSR

7 Marketing Strategic Basic Design SegmentationTargetingPositioning

8 Information Technology Process Product Defining “CRM” People

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10 4. Global Integration

11 Brand Image Quality perceptions Value perceptions Organization Other user influences Brand name Reputation Corporate image Before sales service After sales service During sales service DeliveryGuarantees Warrantees Add-ons Finance Availability Advice Function Design Packaging FeaturesPrice Efficacy CORE

12 Moving from the 4Ps to the 4Cs Inside-Out Focus:Outside-In Focus: Inside-Out Focus:Outside-In Focus: ProductCustomer PriceCost PlaceConvenience PromotionCommunication

13 Global Integration 1. Become a Customer-Centric 2. Use Outside-In Planning 3. Focus on the Total Customer Experience 4. Align Consumer Goals with Corporate Objectives 5. Set Customer Behavior Objectives 6. Treat Customers as Assets 7. Streamline Functional Activities 8. Converge Marketing Communication Activities

14 IMC Management 1. Become a Customer-Centric Organization: The ultimate end user, customer, or consumer must be at the center of any type of integration. For the purposes of IMC, a customer-focused (or customer-centric) organization is simply one that considers the ultimate purchaser or consumer of the product first, foremost, and always.

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16 IMC Management 2. Use Outside-In Planning: The most common method of planning and budgeting for marketing is shown on the next page (inside-out planning). It starts with what the organization wants to achieve and then forces various activities into a series of steps that will hopefully produce the desired results. Planned volume or financial goals drive the marketing and communication or spending levels. If anticipated goals are achieved, the firm is then willing to use a portion of sales to buy further marketing and communication activities.

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IMC Management 2. Use Outside-In Planning: The IMC alternative is to flip the inside-out model to create the outside-in approach. Here the marketing communications manager views customers and prospects not as units of expense but as income flows to the firm. The goal is to manage the creation of demand and income flows rather than products and costs. 18

19 IMC Management 3. Focus on the Total Customer Experience: Total customer experience encompasses how the product or services performs in the marketplace, how it is obtained, the capability of channel members to provide products in a timely and efficient manner, how customer services is delivered, and what type of social impact the firm makes in the community it inhabits.

20 IMC Management 4. Align Consumer Goals with Corporate Objectives: Creative? Perhaps, yes. Effective marketing communication? Probably not. IMC must go much further than traditional communications goals such as building brand awareness or recognition. It must achieve management’s financial goals, too.

21 IMC Management 5. Set Customer Behavior Objectives: To acquire new customers. To retain and maintain present customers. To retain and grow sales volume or profit from existing customers. To migrate existing customers through the firm’s product or services portfolio.

22 IMC Management 6. Treat Customers as Assets: The customer, in most instances, is the primary unit that generates income flows for the organization. Almost all the other activities and initiatives of the organization are really cost centers. So, a key ingredient of the value-oriented IMC system is the understanding that marketing and communication are asset managers. That is, they are or should be responsible for the initiation, continuation, and maintenance of customers, the source of the firm’s income flow.

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24 IMC Management 7. Streamline Functional Activities: One of the major challenges of achieving organizational integration is sorting through the tangle of functional structures and activities through which marketing and communication have developed. Perhaps the greatest value of this collapse of marketing communication disciplines is that is forces the manager to think strategically rather than in terms of communication tactics.

25 IMC Management 8. Converge Marketing Communication Activities: Until the mid-1990s, convergence was generally considered to involve the bringing together all of communication activities under a single umbrella. Today, convergence has taken on a new meaning: the blending of traditional marcom with electronic marketing and communication activities.

26 Stages in IMC Development Firm constantly monitor marcoms’ performance from a return on investment (ROI) perspective. Information, knowledge linked to an ongoing evaluation of each served segment on a global basis. Maintain accessible data sources and build to globally segmented databases. Effectively incorporate data in communication planning and implementation to turn customer data into customer knowledge. Organizations gather extensive information about their customers and evaluating feedback. Also need to align with external agencies. Requires high degree of interpersonal and cross- functional communication within and without the business. Led by the business, not external agencies. Financial and Strategic Integration Application of Information Technology Redefining the Scope of Marketing Communication Tactical Coordinator of Marketing Communication Stages 4th 3rd 2nd 1st Baseline Source: Adapted the IMC Best Practice Report, 1998 APQC

27 Databases and Information Technology Brand Messages (Strategic consistency of brand positioning, big creative idea) Media-mass, niche, and interactive (Intrinsic and created brand contacts) Brand Relationships (Customer acquisition, retention, growth) Sales, profits, and brand equity SWOT Analysis, zero based planning (MC functions and media neutral) Cross-functional organization (Monitoring and evaluating brand relationships) Advertising, customer services, direct response, E- commerce events, packaging, personal selling, public relations, sales promotion, sponsorships, trade shows IMC Process Model IMC is an ongoing process that “spins off” sales, profits, and brand equity