1. The IMC Planning Process

2. Learning objectives
How can the three Cs of the IMC planning context form the basis for an effective advertising program?
What categories are used to identify consumer target markets or market segments?
What categories are used to identify business-to-business market segments?
How do the various approaches to positioning influence the selection of target markets?

3. Learning objectives
How do the various marketing communications objectives interact with the other elements of an IMC planning process?
What are the relationships between communications expenditures and company sales?
What types of marketing communications budgets may be used when developing the IMC planning program?
In addition to advertising, what other IMC components are selected as part of the IMC planning process?

4. Learning Objective # 1: How can the three Cs of the IMC planning context form the basis for an effective advertising program?

5. The IMC Planning Context
In developing an integrated marketing communications plan, the first step requires an analysis of the three Cs:
Customers
competitors, and
communications

6. customers
When conducting an analysis of customers for the purposes of IMC planning, the marketing department examines:
Current customers
Former customers
Potential new customers
Competitors’ customers

7. Current Customers This is the easiest group to study.
Discovering how they think is the first step, including an assessment of what they buy, why, when, where, and how they evaluate products both while making purchases and upon completion of those purchases.

8. Former Customers
Understanding why former customers defected reveal important information, including whether a competitor's product enticed them away or if it was marketing tactics such as advertising, consumer promotions, or personal selling that made the difference.
Then, it may be possible to identify methods to reconnect with them.

9. Potential New Customers
When seeking out potential new customers, the marketing team determines which customers the firm should seek to win.
They may form a new target market or target markets.

10. Competitor's Customers
An analysis of the processes that lead members of this group to choose the competition's offering assists the marketing team in modifying the company's approach, or in reaching the conclusion that members of this group cannot be persuaded to switch.

11. competitors
The company's marketing professionals study the strategies competitors employ and discover the methods used by those companies to interact with consumers.
After listing the competing firms, an analysis of the competition can be conducted using primary research, including store visits, talking to suppliers and other salespeople

12. competition
Next is gathering secondary data. The first items to look at are statements competitors make about themselves, which are found in:
advertisements
promotional materials
annual reports
websites
The third task is to study what other people say about the competition. Marketers often read trade journals. The library might yield additional news articles and press releases about competitor activities.

13. communications
This includes the firm’s current communications, at all levels and in all channels. Messages to current and potential customers, employees, and channel members are studied in order to find out what is working and what is not.

14. Learning Objective # 2: What categories are used to identify consumer target markets or market segments?

15. Target Markets
Target markets are often carefully specified as part of the market segmentation process
A market segment is a set of businesses or group of individual consumers with distinct characteristics. For a market segment to be considered a viable target, it should pass the following tests:
The individuals or businesses within the market segment should be similar in nature, having the same needs, attitudes, interests, and opinions. This means persons or businesses within the segment are homogenous.

16. Target markets
The market segment differs from the population as a whole. Segments are distinct from other segments and the general population.
The market segment must be large enough to be financially viable to target with a separate marketing campaign.
The market segment must be reachable through some type of media or marketing communications method.
Market segmentation consists of identifying specific groups based on their needs, attitudes, and interests.

17. Market Segmentation by Consumer Groups
Segments Based on Demographics – gender, age marketing, education, income, economic groups
Psychographics - Psychographics emerge from patterns of responses, which reveal a person’s attitudes, interests, and opinions (AIO).
Segments Based on Generations
Segmentation by Geographic Area
Usage Segmentation
Benefit Segmentation
Geodemographic Segmentation
Gender
Males and females purchase differing products, buy similar products with different features (e.g., deodorants for women versus men), buy the same products for dissimilar reasons (stereos, televisions), and buy the same products after being influenced by different kinds of appeals through different media.
Figure 4.3 lists tips for marketing to women.
Age Marketing
Children, young adults, middle-aged grown-ups, and senior citizens are all targeted by different types of marketing campaigns. Often age-related factors are combined with other demographics such as gender. Children have a major impact on the purchasing decisions their parents make.
Another age-based demographic group, which appeals to many firms, is seniors, defined as individuals over the age of 55.
Education
People with different levels of education may purchase different products. Level of education is often combined with another demographic, such as gender or age.
Income
Spending is normally directed at three large categories of goods: necessities, sundries, and luxuries. The amount of goods in each category a consumer will purchase is highly dependent on their income.
Ethnic Groups
The three major ethnic groups in the United States are African Americans, Hispanics, and Asian Americans.
Although different in many ways, there are several common threads among these ethnic groups. They all tend to be more brand loyal than their white counterparts. They value quality and are willing to pay a higher price for quality and brand identity. They value relationships with companies and are loyal to the companies that make the effort to establish a connection with them.
Segmentation by Geographic Area
Marketing appeals made to people in a geographic area or region is geo-targeting.
This method is especially useful for retailers who want to limit marketing communication programs to specific areas and for companies conducting direct mail campaigns in target areas.
Geodemographic Segmentation
Geodemographics combines census data with psychographic information. An example would be PRIZM (Potential Rating Index by Zip Marketing), which is a company that specializes in geodemographics. PRIZM has identified 62 different market segments in the United States.
Benefit Segmentation
Benefit segmentation focuses on the advantages consumers receive from a product rather than the characteristics of consumers themselves. Demographics and psychographic information can be combined with benefit information to better identify segments.
Usage Segmentation
The goal of usage segmentation is to seek to provide the highest level of service to a firm’s low or casual, medium or heavy users.
Many companies are able to identify heavy users by utilizing their own databases, using bar-code scanners, point-of-sale systems, and credit/debit transaction cards data.

18. Learning Objective # 3: What categories are used to identify business-to-business market segments?

19. Business-to-Business Segmentation
Segmentation by Industry
Segmentation by Customer Value
Segmentation by Product Usage
Segmentation by Geographic Location
Segmentation by Size
Segmentation by Industry
Many firms use the NAICS (North America Industry Classification System) code. The NAICS code is replacing the SIC (Standard Industrial Classification) coding system.
Firms can target specific industries such as construction (23) or wholesale trade (42). They can also segment within a specific category.
Segmentation by Size
The rationale for this method is that large firms have different needs than smaller companies and therefore should be contacted in a different manner.
Segmentation by Geographic Location
This approach is especially beneficial for businesses that have customers concentrated in geographic pockets such as the Silicon Valley area of California.
Companies can also use geodemographics, combining geographic areas with demographic and psychographic data.
Segmentation by Product Usage
Business markets can be segmented by how the good or service is used. Many services (financial, transportation, shipping, etc.) have a variety of uses for distinct customers.
Segmentation by Customer Value
This method of segmentation is much easier for business-to-business firms to utilize than it is for consumer businesses, due to the availability of in-depth data about each business customer. A more precise value can be assigned to each individual business through sales records and other sources of data and information.

20. Learning Objective # 4: How do the various approaches to positioning influence the selection of target markets?

21. Product Positioning
Positioning is the perception created in the consumer’s mind regarding the nature of a company and its products relative to the competition.
Positioning features variables such as the quality of products, the price, methods of distribution, packaging, image, and other factors.
Two elements stand out: (1) how the product is perceived by customers and (2) the product’s standing relative to the competition.

22. Approaches to Positioning
Product attribute
Competitors
Use or application
Price – Quality Relationship
Product User
Cultural symbol
Product Attributes
Any product trait or characteristic that sets it apart from other products may be considered an attribute.
Competitors
Using competitors to establish position can be accomplished by contrasting the company’s product against others.
Use or Application
Positioning that involves creating a memorable set of uses for a product emphasizes the use or application approach (Arm & Hammer as a deodorizer).
Price-Quality Relationship
Businesses that offer products at the extremes of the price range may position by price–quality relationships.
Product User
This involves distinguishing a brand or product by clearly specifying who might use it.
Product Class
Position can be based on <emphasis>product class, such as an energy drink (Red Bull) versus soft drinks (Coke, Pepsi).
Cultural Symbol
Positioning a product as a <emphasis>cultural symbol</emphasis> is not easy. When the position is successfully achieved, the company holds a strong competitive advantage.

23. Other elements of Positioning
International Positioning
In the international arena, effective positioning remains vitally important. Plans are made to establish an effective position when a firm expands into new countries.
Image and Brand
Positioning is a critical part of image and brand-name management. Consumers have an extensive set of purchasing options and can try products with specific advantages or attributes.
Effective positioning, by whatever method chosen, should increase sales and strengthen the long-term position of an individual product and the total organization

24. Question for Students: Are there any cultural symbols for your generation? What are they?

25. Learning Objective # 5: How do the various marketing communications objectives interact with the other elements of an IMC planning process?

26. Marketing Communication Objectives
Marketing objectives tend to be general because they are for entire company. Some examples of marketing objectives include:
Sales volume
Market Share
Profits
Return on investment

27. Communication Objectives
Develop brand awareness
Increase product/service category demand
Change customer beliefs or attitudes
Enhance purchase actions
Encourage repeat purchases
Build customer traffic
Enhance firm image
Increase market share
Increase sales
Reinforce purchase decisions

28. Learning Objective # 6: What are the relationships between communications expenditures and company sales?

29. Establishing a Communications Budget
 The final two steps in the IMC planning process include preparing a communications budget and selecting the IMC components to be utilized 
Once again, these two activities occur concurrently.  
Communication goals, which goals differ depending on the stage in the buying process that is being addressed.

30. Types of budget Quantitative Models Payout Planning
Objective and Task Method
“What We Can Afford” Method
Meet-the-Competition Method
Percentage of Sales Method
Percentage of Sales Method
Budgets can be based on sales from the previous year or anticipated sales for the next year.
Meet-the-Competition Method
Meet the competition seeks to prevent loss of market share by raising or lowering expenditures to match the competition.
“What We Can Afford” Method
This method sets the marketing budget after all of the company's other budgets have been determined. Money is allocated based on what company leaders feel they can spend.
Objective and Task Method
This method begins with a list of all communication objectives to pursue during the year and then calculates the cost of accomplishing each objective.
Payout Planning
This occurs when management establishes a ration of advertising to sales or market share. This method normally allocates greater amounts in early years to yield payouts in later years.
Quantitative Models
Quantitative models are simulations of relationships between advertising and sales or profits. They may be difficult to create accurately.

31. Learning Objective # 8: In addition to advertising, what other IMC components are selected as part of the IMC planning process?

32.   IMC Components
In terms of budget expenditures on various IMC components:
Media advertising normally accounts for 40% of a communications budget
Trade promotions receive about 25%
Consumer promotions are given on average about 25%
The final 3-5% goes to other expenses.
There are variances from industry to industry
Business-to-business firms have allocations, which are not the same as consumer-oriented firms and also vary by industry

33. International Implications
Some of the tactics used by successful globally IMC programs.
It is important to make sure the company's products and marketing messages will be understood in the region and, when needed, tailored to an individual area.
The goal is to create a borderless marketing plan that uses the same basic marketing approach for all of a company's markets.
This allows each subsidiary the freedom to determine how to implement that marketing plan, in essence, to think globally but act locally.

34. International Implications
Another key is developing local partnerships. Local partners can be marketing research firms or advertising firms that are familiar with the local language and culture.
Communication segmentation means creating a communications package that effectively reaches all possible target markets in another country.
A well-designed market communications analysis begins with the marketing team identifying strengths and weaknesses of local competitors and places in which opportunities exist.
Finally, solid communication objectives should be established.