Irwin/McGraw-Hill © The McGraw-Hill Companies, Inc., 1998 Gilbert A. Churchill, Jr. J. Paul Peter Chapter 17 Managing Marketing Communications Marketing

Irwin/McGraw-Hill © The McGraw-Hill Companies, Inc., 1998 Some Strategic Goals of Marketing Communications Slide 17-1 Table 17.1 Strategic Goal Create awareness Build positive images Build channel relationships Description Inform markets about products, brands, stores or organizations. Develop positive evaluations in people’s minds about products, brands, stores or organizations. Identify prospects Find out the names, addresses and possible needs of potential buyers. Increase cooperation among channel members. Create value for customers, satisfy their wants and needs, and earn their loyalty. Retain customers

Irwin/McGraw-Hill © The McGraw-Hill Companies, Inc., 1998 The Communication Process Slide 17-2 Figure 17.1 Source Transmits Message via Medium Receiver Provides Feedback to Source Receives Decodes Message Source Encodes Message

Irwin/McGraw-Hill © The McGraw-Hill Companies, Inc., 1998 The AIDA Model Slide 17-3 Figure 17.2 Action DesireInterest Attention Marketing Communications

Irwin/McGraw-Hill © The McGraw-Hill Companies, Inc., 1998 The Communications Mix Slide 17-4 AdvertisingPersonal Service Publicity Sales Promotion

Irwin/McGraw-Hill © The McGraw-Hill Companies, Inc., 1998 Comparing the Elements of the Communications Mix Slide 17-5 Message can be Customized for each Customer Considered an Unbiased Source Long Term, Ongoing Activity Marketer Control Over Message Communications Mode Short Term Focus Cost per Contact Overall Cost Personal Selling Sales Promotion AdvertisingPublicity Two-WayOne-Way LowVaries HighNo Direct Cost YesNo YesNo Yes No Yes No HighVaries LowNo Direct Cost Medium-HighHigh Low

Irwin/McGraw-Hill © The McGraw-Hill Companies, Inc., 1998 Managing Communications Strategy Slide 17-6 Set Communications Objectives Select the Communications Mix Set Communications Budgeting Implementation and Control

Irwin/McGraw-Hill © The McGraw-Hill Companies, Inc., 1998 Two Marketing Communications Approaches Slide 17-7 Figure 17.3 End Users ResellersProducer Resellers End Users Marketing Communications Request Products Producer Marketing Communications Push Strategy Pull Strategy

Irwin/McGraw-Hill © The McGraw-Hill Companies, Inc., 1998 Methods for Setting Communications Budgets Slide 17-8a Table 17.3 Method Percentage of sales AdvantageDisadvantage Simple to use Budgeting based on expected sales implies communications can’t improve sales performance Fixed sum per unit Marketer likely to benefit from increasing the budget during times of rising sales Decreasing the communications budget during periods of falling sales could be disastrous in some cases Competition- based Takes into account competitors’ activities Amounts budgeted will be reasonable if competitors are budgeting effectively Can be difficult to get competitors’ budget information Can lead to ever-increasing communications budgets Assumes competitors have the same objectives

Irwin/McGraw-Hill © The McGraw-Hill Companies, Inc., 1998 Methods for Setting Communications Budgets Slide 17-8b Table 17.3 Method All you can afford AdvantageDisadvantage Takes into account limited resources May stimulate creativity in making funds work hard Doesn’t consider marketing objectives Borrowing may be worthwhile to fund some communications strategies Objective and task Based on achieving communications objectives Focusing on objectives uses funds most efficiently No basis for setting priorities among objectives Treats all objectives as equally worthy of funding Hard to estimate what will it cost to achieve a particular objective

Irwin/McGraw-Hill © The McGraw-Hill Companies, Inc., 1998 Evaluating the Effectiveness of Marketing Communications Slide 17-9 Sales Changes Marketing Research Sales Changes Why it Happened What Happened ? ?