Introduction to IMC (Integrated Marketing Communication)

Advertisement and Sales Promotion

Chapter: 1

Introduction to IMC (Integrated Marketing Communication)

                      

Marketing

          Think of marketing for some seconds. Two things would come to your mind:

1.  Sales

2.  Advertisement

          Marketing is the process of maximizing the profitability and sales of the organization by identifying the needs and wants of the customers and convincing them how they can fulfill their needs though our product.

Past Marketing:

          In past advertisement used to be done on the mass media like televisions, newspapers, etc. Mass media was very popular and useful as the marketing medium till late 80s but after that it lost its grip.

21^st Century Marketing:

          The advertisement done today is far more different then the old era. Now, the emergence of new technology, the growth in the internet usage, rapidly changing environment, changing way of communications, fragmentation of mass markets, growing economies, and globalization has changed the overall marketing to use different other communication mediums and techniques with the old ones (newspapers, TV, Radio, etc.).

IMC (Integrated Marketing Communication)

          IMC is a plan through which we check and analyze different communication disciplines (like direct marketing, sales promotion etc) according to our product target market and strategy so that we could get maximum communication impact.

          In IMC we don’t rely only on one media. We choose different variety of promotional tools.

          The American Association for Advertising Agencies (4A) definition for IMC is as follow:

“A marketing communication plan that evaluates the strategic role of different communication disciplines and combines these disciplines to provide clarity, consistency, and maximum communications impact.

          The above definition tells us these things:

a.    Identify the best fit of advertisement disciplines 

b.    Build positive and consistent relationship to the customers and stakeholders

c.    Build and sustain brand identity and equity

d.   IMC requires that firm should develop the overall marketing strategy that requires how all of a firm’s marketing activities, not just promotion, communicates with its customers.

Brand Identity

          Brand Identity is the brand impression that comes in the customer’s mind while thinking about that very brand. It is basically logo, symbols, organization culture, design, and performance of the product.

Brand Equity

          Brand Equity is the status of the brand with respect to other brands available in the market.

          So, generally, IMC is basically identifying the best communication method and building relationships with the stakeholders and customers. There are a lot of choices available for the customers but limited time to think. Therefore, IMC builds the impression of the brand in the mind of the customer. Because of this positive brand impression, customers take no time and choose the product with brand image in his mind.

Promotion

          Promotion has been defined as the coordination of all seller-initiated efforts to set up channels of information and persuasion in order to sell goods and services or promote an idea.

The Promotional Mix: The Tools for IMC

          The basic tools used to accomplish an organization’s communication objectives are often referred to as the promotional mix.

Elements of Promotional Mix

Advertising

          Advertising is defined as any paid form of nonpersonal communication about an organization, product, service, or idea by an identified sponsor.

          The paid aspect of this definition reflects the fact that the space or time for an advertising message generally must be bought. An exception to this is the PSA (Public Service Announcement), whose space and time is donated by the media.

          The nonpersonal component means that advertising involves mass media that can transmit a message to large group of individuals, often at the same time.

          Advertising is also valuable tool for building company and brand equity as it is a powerful way to provide consumers with information as well as to influence their perceptions.

           Advertising can be used to create favorable and unique images and associations for a brand. Brand image plays an important role in the purchase of many products and services, and advertising is still recognized as one of the best ways to build a brand.

Classifications of Advertising

1.      Advertising to Consumer Markets

A.    National Advertising – done by companies on a nationwide basis or in most regions of the country. Most of the ads for well-known companies and brands are seen on primetime TV or in other major national or regional media are examples of national advertising.

The goals of national advertising are:

a.       to inform or remind consumers of the company or brand and its features, benefits, advantages, or uses and

b.      to create or reinforce its image so that consumers will be predisposed to purchase it.

B.     Retail/Local Advertising – done by retailers or local merchants to encourage consumers to shop at a specific store, use a local service, or patronize a particular establishment. Retail or local advertising tends to emphasize specific patronage motives such as price, hours of operation, service, atmosphere, image, or merchandise assortment.

Retailers are concerned with building store traffic, so their promotions often take the form of direct action advertising designed to produce immediate store traffic and sales.

C.     Primary and Selective Demand Advertising

Primary Demand advertising is designed to stimulate demand for the general product class or entire industry.

          An advertiser might concentrate on stimulating primary demand when, for example, its brand dominates a market and will benefit most from overall market growth.   

          Primary demand advertising is often used as part of promotional strategy to help a new product gain market acceptance, since the challenge is to sell customers on the product concept as much as to sell a particular brand.

          Industry trade associations also try to stimulate primary demand for their member’s products, among them cotton, milk, pork, orange juice, and beef.

         

Selective Demand advertising focuses on creating demand for a specific company’s brands.

          Most advertising for products and services is concerned with stimulating selective demand and emphasizes reasons for purchasing a particular brand.

2.      Advertising to Business and Professional Markets

A.    Business to Business Advertising – advertising targeted at individuals who buy or influence the purchase of industrial goods or services for their customers.

Industrial goods are products that either become a physical part of another product(raw materials or component parts), or are used to help a company conduct its business(office supplies, computers). Business services such as insurance, travel services, and health care are also included in this category.

B.     Professional Advertising – targeted to professionals such as doctors, lawyers, dentists, engineers, or professors to encourage them to user a company’s product in their business operations. It might also be used to encourage professionals to recommend or specify the use of a company’s product by end-users.

C.     Trade Advertising – targeted to marketing channel members such as wholesalers, distributors, and retailers. The goal is to encourage channel members to stock, promote, and resell the manufacturer’, branded products to their customers.

Direct Marketing

          Direct Marketing is a marketing activity in which organizations communicate directly with target customers to generate a response and/or a transaction.

          It involves a variety of activities, including database management, direct selling, telemarketing, and direct response ads through direct mail, the internet, and various broadcast and print media.

          Direct Response Advertising is one of the major tools of direct marketing, whereby a product is promoted through an ad that encourages the consumer to purchase directly from the manufacturer.

          Direct response advertising has been very popular over the past two decades, owing primarily to changing lifestyles, particularly the increase in two-income households. This has meant more discretionary income but less time for in-store shopping.

Interactive/Internet Marketing

          Interactive/Internet Marketing is a promotional tool in which organizations communicate through interactive media, particularly the Internet. Interactive Media allows for a back-and-forth flow of information whereby users can participate in and modify the form and content of the information they receive in real time.

          In addition to the internet, other forms of interactive media include CD-ROMs, kiosks, interactive television, and digital cell phones.

          The Internet is actually a multifaceted promotional tool. On one hand, it is an advertising medium as many companies advertise their products and services on the websites of other companies and/or organizations or pay to link their banner ads or websites to search engines such as Google and Yahoo.

Sales Promotion

          Sales Promotion are those marketing 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 broken into two major categories:

·         Consumer-Oriented Sales Promotion

·         Trade-Oriented Sales Promotion

Consumer-Oriented Sales Promotion is targeted to the ultimate user of a product or service and includes couponing, sampling, premiums, rebates, contests, sweepstakes, and various point-of-purchase (POP) materials. These promotional tools encourage consumers t make an immediate purchase and thus can stimulate short-term sales.

           Trade-Oriented Sales Promotion is targeted toward marketing intermediaries such as wholesalers, distributors, and retailers. Promotional and merchandising allowances, price deals, sales contests, and trade shows are some of the promotional tools used to encourage the trader to stock and promote a company’s products.

Publicity/Public Relations

          Publicity refers to nonpersonal communications regarding an organization, product, service, or idea not directly paid for or run under identified sponsorship.

          The company or organization attempts to get the media to cover or run a favorable story n a product, service, cause, or event to effect awareness, knowledge, opinions, and/or behavior.  

          Techniques used to gain publicity include news releases, press conferences, feature articles, photographs, films, and videotapes.

          Publicity is not always under the control of an organization and is sometimes unfavorable. Negative stories about a company and/or its products can be very damaging.

          Public Relations is 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.

          Public relations have a broader objective than publicity, as its purpose is to establish and maintain a positive image of the company among its various publics.

          Public relations uses publicity and a variety of other tools – including special publications, participation in community activities, fund-raising, sponsorship of special events, and various public affairs activities – to enhance an organization’s image.

Personal Selling

          Personal Selling is a form of person-to-person communication in which a seller attempts to assist and/or persuade prospective buyers to purchase the company’s products or service or to act on an idea.

          Personal selling involves direct contact between buyer and seller, either face-to-face or through some form of telecommunications such as telephone sales. This interaction gives the marketer communication flexibility; the seller can see or hear the potential buyer’s reactions and modify the message accordingly.

          

The IMC Planning Process

Integrated Marketing Communication Management

          IMC Management involves the process of planning, executing, evaluating, and controlling the use of various promotional-mix elements to effectively communicate with target audiences.

          The marketer must consider which promotional tool to use and how to integrate them to achieve marketing and communication objectives.

          This process is guided by an integrated marketing communications plan that provides the framework for developing, implementing, and controlling the organization’s IMC program.

          Marketing communications is but one part of, and must be integrated into, the overall marketing plan and program.

Steps in IMC Planning Process

1.      Review of the Marketing Plan

A Marketing Plan is a written document that describes the overall marketing strategy and programs developed for an organization, a particular product line, or brand.

·         Examine the overall marketing plan and objectives

·         Role of advertising and promotion

·         Competitive analysis

·         Assess environmental influences

2.      Analysis of Promotional Program Situation

·         Internal Analysis assesses relevant areas involving the product/service offering and the firm itself.

-       Promotional department organization

-       Firm’s ability to implement promotional program

-       Agency evaluation and selection

-       Review of previous program results

·         External Analysis focuses on factors such as characteristics of the firms customers, market segments, portioning strategies, and competitors.

-       Consumer behavior analysis

-       Market Segmentation and target marketing

-       Market positioning

3.      Analysis of the Communication Process

Communication Objectives refer to what the firm seeks to accomplish with its promotional programs.

·         Analyze receiver’s response processes

·         Analyze source, message, channel factors

·         Establish communications goals and objectives

4.      Budget Determination

·         Set tentative marketing communications budget

·         Allocate tentative budget

5.      Develop Integrated Marketing Communications Program

·         Elements of Promotional Mix

6.      Integrate and Implement Marketing Communications System

·         Integrate promotional mix strategies

·         Create and produce ads

7.      Monitor, Evaluate, and Control Integrated Marketing Communications Program

·         Evaluate promotional results/effectiveness

·         Take measures to control and adjust promotional strategies