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Integrated Marketing Communications and International Advertising
Chapter 16 Integrated Marketing Communications and International Advertising McGraw-Hill/Irwin International Marketing, 13/e © The McGraw-Hill Companies, Inc., All Rights Reserved.
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Chapter Learning Objectives
Local market characteristics that affect the advertising and promotion of products The strengths and weaknesses of sales promotion and public relations in global marketing When global advertising is most effective; when modified advertising is necessary The effects of a single European market on advertising The effect of limited media, excessive media, paper and equipment shortages, and government regulations on advertising and promotion budgets The communication process and advertising misfires
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Global Perspective Barbie Versus Mulan
The original Barbie between Japan, Hong Kong and Hollywood Major toy makers increasingly are designing 1 version globally Cable & satellite TV and internet International retail giants – Wal- Mart, Toys “R” us, Carrefour Rapunzel Barbie launched in 59 countries at the same time. TV ad campaign in 35 languages around the world broadcasted at the same time+ web site+ games+ videos+ movies Action figures toys make up just 1% of the toy market in Germany, 5% in US AND 6% in UK Disney’s Jasmine in the Islamic world Despite of Mattel IMC plan Barbie sales declined sharply in front of the more ethnically diverse competitors’ products
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Las Vegas Loosing Its Exclusivity
The gaming heritage Resort industry Dinning& Shopping Competition from other cities Lack of a unifying idea that could break through the clutter People love to come to Las Vegas to cut loose, have fun and do things they wouldn’t do back home R&R Partners “Only in Vegas” ads Relation to text This slide relates to the material on pp. 3-4 of the text, which discusses the branding campaign for Las Vegas. Summary Overview This slide shows a frame from one of the commercials for the popular ad campaign created by R&R Partners. The challenge was to find a unified way of marketing the city that would create a unique brand identity for Vegas that would resonate with and motivate a wide range of people. Use of this slide This slide can be used as part of a discussion of how the roles of advertising and other forms of promotion are being used by companies and organizations such as the Las Vegas Convention & Visitors Authority to create integrated marketing communications programs for their products and services.
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Using IMC To Market Las Vegas
Relation to text This slide relates to the material on pp. 3-4 of the text, which discusses the branding campaign for Las Vegas. Summary Overview This slide shows a frame from one of the commercials for the popular ad campaign created by R&R Partners. The challenge was to find a unified way of marketing the city that would create a unique brand identity for Vegas that would resonate with and motivate a wide range of people. Use of this slide This slide can be used as part of a discussion of how the roles of advertising and other forms of promotion are being used by companies and organizations such as the Las Vegas Convention & Visitors Authority to create integrated marketing communications programs for their products and services.
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Creating a Unique Brand Identity for Las Vegas
Relation to text This slide relates to the material on pp. 3-4 of the text, which discusses the branding campaign for Las Vegas. Summary Overview This slide contains a television commercial from a campaign developed for the Las Vegas Convention & Visitor’s Authority. The tagline for this campaign is “What happens here, stays here”. Use of this slide The commercial shown in this slide can be used as an example of how many companies are taking a different approach in developing their marketing communication programs than in the past. *Click outside of the video screen to advance to the next slide © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
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Leveraging the popular commercials into IMC
Marketing guerilla efforts around the Oscar and Grammy awards Sponsorships, PR& feature stories in CNN& National Public Radio, US Today, NY Times, WS journal and cover story in Time magazine Grand Marketer Award 2004 37.4 million visitors 89% occupancy rate Relation to text This slide relates to the material on pp. 3-4 of the text, which discusses the branding campaign for Las Vegas. Summary Overview This slide contains a television commercial from a campaign developed for the Las Vegas Convention & Visitor’s Authority. The tagline for this campaign is “What happens here, stays here”. Use of this slide The commercial shown in this slide can be used as an example of how many companies are taking a different approach in developing their marketing communication programs than in the past.
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Taking The “Only Vegas” Campaign in a New Direction
Relation To Text This slide relates to the “Only Vegas” campaign that is discussed in the opening vignette to Chapter 1. Summary Overview In 2006 R&R Partners took the “Only Vegas” campaign in a new direction with ads promoting the "Be Anyone” concept. The underlying message of the ads is that Vegas visitors can virtually be anyone for a few days. To help visitors take this one step further. The LVCVA Web site ( featured a "Be Anyone" sweepstakes banner and upon entering, visitors were invited to create their own persona. First, visitors were asked to build their character's profession using a 100-point scale over categories that include smoothness, style, bravery, attitude, smarts. Their choices then guide their character's personality profile. Several subsequent steps help further hone their new identity. Finally, they are presented with the "New Vegas You," complete with printable business cards, a real Web site and 800 number for their faux business, plus printable certificates of achievement in their field, suitable for framing. They are also invited to enter the "Be Anyone" sweepstakes, in which the winner gets to be whoever they've always wanted to be on a trip to Vegas such as a rock star, high roller, diva, or professional golfer. This print ad reinforces the online concept, by presenting a print version of the “Be Anyone” concept. Use of Slide This slide can be used to show how R&R Partners is finding new ways to extend the “Only Vegas” campaign.
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Creating a Unique Brand Identity for Las Vegas
Relation to text This slide relates to the material on p. 5 of the text, which discusses the branding campaign for Las Vegas. Summary Overview This slide contains a television commercial from a campaign developed for the Las Vegas Convention & Visitor’s Authority. The tagline for this campaign is also “What happens here, stays here”. It is an example of how R&R partners used an integrated marketing communications approach to reach their target audience. Use of this slide The commercial shown in this slide can be used as an example of how many companies are taking a different approach in developing their marketing communication programs than in the past. *Click outside of the video screen to advance to the next slide © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
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Traditional Approach to Marketing Communications
Publicity Point of purchase Sales promotion Media Adver- tising Packaging Special events Public relations Direct response Interactive marketing Relation to text This slide relates to material on pp of the text. Summary Overview This slide shows the traditional approach to advertising and promotion where many of the marketing and promotional functions were planned and managed separately with different budgets, different views of the market, and different goals and objectives. Many of the marketing activities such as package design, sales promotion, and direct marketing services were viewed as ancillary services and handled on a project basis rather than integrating them into the IMC program. Use of this slide This slide can be used to show the traditional approach to marketing communications that lacks coordination and consistency. The disconnected puzzle pieces are designed to demonstrate how traditional approaches to marketing communications often viewed the various IMC tools as separate pieces of the puzzle rather than having them all work together. Direct marketing
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Contemporary IMC Approach
Packaging Sales promotion Direct response Media Adver- tising Point of purchase Public relations Publicity Interactive marketing Relation to text This slide relates to material on pp of the text which discusses the contemporary approach to integrated marketing communications. Summary Overview This slide shows the contemporary approach to advertising and promotion which is referred to as Integrated Marketing Communications. This approach seeks to have all of a company’s marketing and promotional activities project a consistent, unified image in the marketplace. It calls for a centralized messaging function so that everything a company says and does communicates a common theme and positioning Use of this slide This slide can be used to show the contemporary approach to marketing communications that includes coordination and consistency. The connected puzzle pieces are designed to demonstrate how the various IMC tools are coordinated with media advertising and work together in a seamless fashion to create an effective communications program. Direct marketing Special events
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Defining IMC IMC is a strategic business process used to plan, develop, execute and evaluate coordinated, measurable, persuasive brand communication programs over time with consumers, customers, prospects, employees, associates and other targeted relevant external and internal audiences. Don Schultz Relation To Text This slide relates to the material on p. 11 of the text, which discusses the evolution of IMC. Summary Overview This slide shows the new definition of IMC developed by Don Schultz of Northwestern University who is one of the leading IMC scholars. The three major aspects of this new definition of IMC are shown in the next slide. Use of this slide This slide can be used to present the new definition of IMC developed by Schultz. You might compare this new definition to the original definition of IMC developed by the American Association of Advertising Agencies, which is shown on p. 10. The goal of IMC is to generate short-term financial returns and build long-term brand value.
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A Contemporary Perspective of IMC
Recognized as a business process Ongoing strategic business process IMC Not just another management fashion Importance of relevant audience Multiple relevant audiences Relation to text This slide relates to pp and IMC Perspective 1-1 in text. Summary Overview There are several important aspects of the definition of IMC: Recognized as a business process – rather than just tactical integration of various communication activities. Importance of relevant audiences – externally these include customers, prospects, suppliers, investors, interest groups, and the general public. Employees are an example of an internal audience. Demand for accountability – increased emphasis on the outcomes of marketing communication programs. Use of this slide This slide can be used to help students understand that IMC involves more than just coordinating the various elements of a marketing and communications program into a “one look, one voice” approach. Demand for accountability Demand for accountability and Measurement of Outcomes
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Reasons for the Growing Importance of IMC
From Toward Media advertising Multiple forms of communication Media advertising Multiple forms of communication Mass media Specialized media Mass media Specialized media Manufacturer dominance Retailer dominance Manufacturer dominance Retailer dominance Relation to text This slide relates to material on pp of the text which discusses reasons for the growing importance of IMC. Summary Overview The integrated marketing communications movement is also being driven by changes in the ways companies market their products and services. A major reason for the growing importance of the IMC approach is the ongoing revolution that is changing the rules of marketing. These changes include: A shift in dollars from media advertising to other forms of promotions particularly consumer and trade oriented sales promotion. A movement away from mass media and advertising toward more targeted communication tools such as event marketing and sponsorship, direct mail, and the Internet. A shift in marketplace power from manufacturers to retailers resulting in retailers demanding larger promotional fees and allowances from manufacturers. Technology has allowed for a rapid increase in database development and information sharing. Marketers are using this information to improve market targeting. Greater accountability from advertising agencies and changes in agency compensation. Companies are moving more toward incentive based systems of compensation. Rapid growth of the Internet. The interactive nature of the Internet has made it a vital part of most companies’ communications strategy Use of this slide This slide can be used to explain the reasons for the growing importance of IMC in contemporary marketing. General focus Data-based marketing General focus Data-based marketing Low agency accountability Greater agency accountability Low agency accountability Greater agency accountability Traditional compensation Performance-based compensation Traditional compensation Performance-based compensation Limited Internet availability Widespread Internet availability
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IMC and Branding Brand Identity is a combination of factors: Name, logo, symbols, design, packaging, product or service performance, and image or associations in the consumer’s mind. 2005 Brand Value (Billions of Dollars) 1. Coca-Cola $67.52 2. Microsoft $59.94 3. IBM $53.38 4. GE $46.99 5. Intel $35.59 6. Nokia $26.45 7. Disney $26.44 8. McDonald’s $26.01 9. Marlboro $24.84 10. Mercedes $21.19 Relation to text This slide relates to material found on page 15 of the text. Summary Overview With more and more products and services available to consumers, developing and maintaining brand identity is becoming increasingly more important. Well known brands have a major competitive advantage in today’s marketplace. A well-defined and coordinated IMC plan contributes to overall brand identity and equity. Use of this slide This slide can be used to define brand identity and discuss the importance of building and sustaining strong brand identity. The list of the 10 most valuable brands, as measured by the brand consultancy company Interbrand, should be familiar to your students. You might discuss how these popular brands may have a competitive edge with consumers during the purchase decision process. IMC plays a major role in the process of developing and sustaining brand identity & equity by increasing the number of encounters between the consumers and the brand
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Intel’s Advertising Helps Build Brand Equity The Bunny People
Relation to text This slide relates to the material in IMC Perspective 1-2 on p. 16 regarding the power of brands. Summary Overview This slide contains a commercial from one of the phases of the “Intel Inside” advertising campaign. Intel is one of the world’s 10 most valuable brands. Intel spends over $1 billion a year globally on advertising which makes it the world’s leading high tech advertiser. The commercial shown here features Intel’s “Bunny People” who were introduced in early 1997 as part of the advertising campaign for the Pentium II microprocessor with MMX technology. The Bunny People are a takeoff of the workers who wear so-called bunny suits to keep chip labs sterile. The spot shows the technicians adding something new to Intel’s Pentium processor – fun in the form of MMX technology. It then shows the Bunny People dancing to the’70s disco hit – Play That Funky Music. Use of this slide The Intel commercial can be used as part of a discussion of branding and the role advertising plays for companies in developing and maintaining a strong brand image. Intel has used a variety of advertising campaigns over the past 15 years to strengthen its brand image and demonstrate the power of its various generations of Pentium processors. *Click outside of the video screen to advance to the next slide © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
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Basic Elements of the Promotional Mix
Advertising Advertising Direct Marketing Direct Marketing Interactive/ Internet Marketing Interactive/ Internet Marketing Sales Promotion Sales Promotion Relation to text This slide relates to material on page and Figure 1-2. Summary Overview The promotional mix is the basic tools used to accomplish an organization’s communication objectives. These tools include: Advertising – any paid form of non personal communication about an organization, product, service, or idea by an identified sponsor Direct marketing – communication directly with target customers to generate a response and/or transaction Interactive/Internet marketing – communication through interactive media such as the Internet, CD-ROMS and kiosks. Sales promotion – marketing activities that provide extra value or incentives to sales force, distributors, or consumers to stimulate immediate sales Publicity/Public Relations – Publicity is a form of non-personal communication not directly paid for or run under identified sponsorship. Public relations is a management function which executes programs of action to earn public understanding and acceptance an enhance the image of the company. Personal Selling – person-to-person communication between a seller and buyer Use of this slide This slide can be used to introduce and define the various elements of the promotional mix. Publicity/Public Relations Publicity/Public Relations Personal Selling
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Sales Promotions in International Markets
Marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation Short-term efforts directed to the consumer or retailer to achieve specific objectives’ P&G “Arial Road Show” to the rural areas in Egypt In markets with media limitations the percentage of the promotional budget allocated to sales promotions may have to be increased Pepsi an Coke carnival truck in Latin America Product sampling – Nestle rest- stop in France
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Coupons Samples Premiums Training Programs efunds/Rebates Bonus Packs
Sales Promotion Tools Coupons Coupons Samples Samples Trade Allowances Premiums Premiums POP Displays Contests/Sweepstakes Contests/Sweepstakes Training Programs Training Programs efunds/Rebates Refunds/Rebates Bonus Packs Bonus Packs Trade Shows Trade Shows Loyalty Programs Coop Advertising Coop Advertising Relation to text This slide relates to material on p. 22 of the text, which discusses the role of sales promotion as an IMC tool. Summary Overview Sales promotion is defined as those activities that provide extra value or incentives to the sales force, the distributors, or the ultimate consumer and can stimulate immediate sales. Sales promotion is generally broken down into two categories: Customer-oriented – targeted to the ultimate user of the product or service and includes coupons, sampling, premiums, contests, sweepstakes, refunds/rebates, bonus packs, events, and loyalty programs. Trade-oriented – targeted to marketing intermediaries such as wholesalers, distributors, and retailers and includes trade allowances, price deals, sales contests, trade shows, and cooperative advertising. Use of slide This slide can be used to introduce sales promotion as an IMC tool and the various types consumer and trade promotions. Events Events Consumer-oriented [For end-users] Trade-oriented [For resellers]
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Various Uses of Sales Promotion
Introduce new products Introduce new products Get existing customers to buy more Get existing customers to buy more Combat competition Attract new customers Attract new customers Sales Promotion Enhance personal selling Enhance personal selling Maintain sales in off season Maintain sales in off season Relation to text This slide relates to the material on p. 22, which discusses the role of sale promotion as part of the IMC program. Summary Overview There are various reasons why companies choose to use sales promotion in their IMC programs. The various uses of consumer and trade promotion include: Introduce new products Get existing customers to buy more Attract new customers Maintain sales in off seasons Increase retailer inventories Enhance or tie in advertising with personal selling Combat competition Use of Slide This slide can further supplement the discussion of sales promotion and why companies use this tool as part of their IMC programs Tie in advertising & personal selling Increase retail inventories Tie in advertising & personal selling Increase retail inventories
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Advertising Versus Publicity
Factor Advertising Publicity Control Great Little Credibility Lower Higher Reach Measurable Undetermined Frequency Schedulable Uncontrollable Relation to text This slide relates to material on pp , which discusses the role of publicity. Summary Overview Another important component of an organization’s promotional mix is publicity/public relations. Publicity refers to the non personal communications regarding an organization, product, service, or idea not directly paid for or run under identified sponsorship. Companies attempt to get the media to cover or run favorable stories on their products, services, or causes. It usually comes in the form of a news story, editorial, or announcement. There are a number of advantages and disadvantages that publicity has relative to advertising. This slide compares advertising and publicity on a number of factors. Use of this slide This slide can be used to introduce publicity/public relations and to discuss how publicity compares to advertising with respect to various factors. Cost High/Specific Low/Unspecified Flexibility High Low Timing Specifiable Tentative
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© 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
Publicity Vehicles Feature Articles Feature Articles News Releases News Releases Interviews Interviews Publicity Vehicles Relation to text This slide relates to the material on pp Summary Overview Companies attempt to get the media to cover or run favorable stories on their products, services, or causes. There are a number of publicity vehicles available to marketers. Publicity can be generated through the use of: feature articles news releases press conferences special events interviews Use of Slide This slide can be used to show the various methods that can be used to generate publicity for companies, brands, organizations, or causes. Press Conferences Special Events Special Events © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
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Public Relations When an organization systematically plans and distributes information in an attempt to control and manage its image and the nature of the publicity it receives, it is really engaging in PR. “The management function which evaluates public attitudes, identifies the policies and procedures of an individual or organization with the public interest, and executes a program of action to earn public understanding and acceptance” Answer: E
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Public Relations Tools
Publicity Vehicles Publicity Vehicles Special Publications Special Publications Community Activities Community Activities Corporate Advertising Corporate Advertising Cause-related Marketing Cause-related Marketing Relation to text This slide relates to material on pp , which discusses public relations. Summary Overview It is important to distinguish between publicity and public relations. When an organization systematically plans and distributes information in an attempt to control and manage its image and the nature of the publicity it receives, it is really engaging in public relations. There are a variety of public relations tools available to marketers such as publicity vehicles, special publications, community activities, fund raising programs, public affairs activities, and special event sponsorships. Organizations can also use advertising as a public relations tool. Use of Slide This slide can be used to explain the various public relations tools. It also provides an opportunity to discuss the differences between public relations and publicity. Public Affairs Activities Public Affairs Activities Special Event Sponsorship
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International Public Relations
Bridgestone/Firestone Tires safety recall & Throwing the blame Global workplace standards Building an international profile for new companies Corporate sponsorships despite of their connections to advertising Tobacco companies using sports event sponsorships. Coca Cola & soccer, Macdonald’s & Sidney Olympics 2000 The role of public relations (PR) is creating good relationships with the popular press and other media to help companies communicate messages to customers, the general public, and governmental regulators.
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The Growth of Advertising and Promotion
Relation to text This slide relates to material on page 5 of the text. Summary Overview This chart displays the growth of advertising and promotion in the U.S. and outside the U.S. over the past twenty years. Reasons for the growth in advertising and promotion are: Overall growth of both U.S. and global economies Efforts of expansion minded marketers to take advantage of the growth opportunities Recognition around the world of the value and importance of advertising and promotion as part of the marketing process Use of this slide This slide can be used to show that advertising and promotion are an integral part of our social and economic systems. Over the years advertising has evolved into a vital communications system for both consumers and businesses. In market based economies, consumers have come to rely on advertising and other forms of promotion for information they can use in making purchase decisions. Relation to text This slide relates to material found on page 7 of the text. Summary Overview This slide charts evidence of the increasing importance of advertising and promotion expenditures. The increase in spending on advertising and promotion over the past three decades provides evidence of the important role of marketing communications. Use of this slide This slide can be used to discuss what factors have contributed to the tremendous growth in expenditures for advertising and promotion, such as the growth of the U.S. and global economies and the efforts of expansion-minded markets to take advantage of these growth opportunities. NEED TO USE UPDATED Numbers from 2005, Advertising Outside US $294 US Sales Promotion Ok US Advertising $276 Change year in Box to 2005 © 2007 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
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Top 20 Global Advertisers ($ millions)
Insert Exhibit 16.1
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International Advertising
Perform marketing research. Specify the goals of the communication. Develop the most effective message(s) for the market segments selected. Select effective media. Compose and secure a budget. Execute the campaign. Evaluate the campaign relative to the goals specified.
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Advertising Strategy and Goals
Marketing problems require careful marketing research and thoughtful and creative advertising campaigns in country, regional, and global markets, respectively. Increased need for more sophisticated advertising strategies. Increased costs, coordination of adv. programs, global image Balance between standardization of advertising themes and customization. Foreign or domestic agencies Centralization or decentralization Gillete, the best a Man can get – umbrella statement but different brand names Consumer cultures as a base for segmentation
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Product Attributes and Benefit Segmentation
Different cultures usually agree on the benefit of the primary function of a product Other features and psychological attributes of the item can have significant differences Cameras in US, Japan and Africa - excellent pictures is the primary function Dannon’s yogurt - health in US and Pleasure in France Blue Diamond’s Almonds – assumes that no two markets will react the same, that each has its own set of differences, and that each will require a different marketing approach and strategy In US “a can a week is all what we ask”, Canada considered it too silly . In Japan almond tofu and miso soup
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Regional Segmentation
Pan-European communications media highlighting need for more standardized promotional efforts and harmony in brand names IBM pan-European promotional strategy- CIM Costs savings with a common theme in uniform promotional packaging and design Eveready in Latin America 1 message campaign to 16 countries Legal restrictions slowly being eliminated
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The International Communications Process
Insert Exhibit 16.4
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Global Advertising and the Communications Process
If not properly considered, the different cultural contexts can increase the probability of misunderstandings Effective communication demands the existence of a “psychological overlap” between the sender and the receiver It can never be assumed that “if it sells well in one country, it will sell in another” Tooth paste for cavity reducing in US& breath control in Europe Encoding Problems even with the right message – Is the perfume effective against infertility in Africa?!! Decoding problems – Pepsi “come alive”, Chevrolet NOVA “doesn’t go” in Spain
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Legal Constraints Laws that control comparative advertising vary from country to country in Europe. Comparative advertising- Germany, Belgium and Luxembourg Advertising of specific products - Pharmaceuticals Control of advertising on television- Time and content Accessibility to broadcast media Limitations on length and number of commercials – In Germany 20 min between commercials and not more than 12 min/hour Internet services Special taxes that apply to advertising
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Linguistic Limitations
Language is one of the major barriers to effective communication through advertising Translation challenges Low literacy in many countries Multiple languages within a country
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Cultural Diversity Knowledge of cultural diversity must encompass the total advertising project General Mills instant cake in UK and Japan Toyota Prado “rule by force” not a nice memory in China Existing perceptions based on tradition and heritages are often hard to overcome P&G and the story of the bird delivering Pampers in Japan Subcultures Changing traditions and Coffee in Japan
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Media Limitations and Production and Cost Limitations
Media limitations may diminish the role of advertising in the promotional program 10 showings /year with no 2 exposures closer than 10 days in Italy Examples of production limitations: Poor-quality printing : Kodak in China Lack of high-grade paper : Colgate - Palmolive in Eastern Europe Low-cost reproduction in small markets poses a problem in many countries – Coca Cola and Nestle using Feluccas Sails in Egypt
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Media Planning and Analysis – Tactical Considerations
10-50 commercial string sandwiches in Brazil National coverage = different media Annual TV scheduling by August 30 in Germany In Vietnam Newspapers ads limited to 10% of space and 5% of time on radio and TV
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Media Planning and Analysis – Tactical Considerations
Availability Cost Coverage Lack of market data - circulation& segmentation Newspapers Number, paper shortage, ad space, editorials and advertorials Magazines
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Media Planning and Analysis – Tactical Considerations (continued)
Radio and television Satellite and cable TV Direct mail The Internet Other media Cinema , Billboards etc.
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Campaign Execution and Advertising Agencies
Managed by advertising agencies Local domestic agency Company-owned agency Multinational agency with local branches Compensation Commonly 15 percent throughout the world Some companies moving to reward-by-results
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International Control of Advertising: Broader Issues
Consumer criticism Deceptive advertising Decency and blatant use of sex Self-regulation Government regulations
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Summary An integrated marketing communications (IMC) program includes coordination among advertising, sales management, public relations, sales promotions, and direct marketing. Currently companies are basing their advertising strategies on national, subcultural, demographic, or other market segments. The major problem facing international advertisers is designing the best messages for each market served. The availability and quality of advertising media vary substantially around the world. Advances in communication technologies are causing dramatic changes in the structure of the international advertising and communications industries.
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