Taking The “Only Vegas” Campaign in a

New Direction

An Introduction to Integrated
Marketing Communications

T. Sai Vijay
Assistant Professor
SSIPMT

The Growth of Advertising and Promotion What is Marketing?

• Earlier AMA defined marketing as

“ the process of planning and executing the conception, pricing,

promotion, and distribution of ideas, goods and services to create
exchanges that satisfy individual and organizational objectives”.

• Exchange – the central concept (two or more parties with

something of value to each other, a desire and ability & a way
to communicate with each other)

• Not all marketing transactions involve the exchange of money

for product or services

1
 What is Marketing?

Marketing is an Value
organizational function
and a set of processes for Relationship marketing
creating, communicating
and delivering value to
customers and for Mass customization
managing customer
relationships in ways that
benefit the organization. Customer relationship
management (CRM)

2
 Coordinated Marketing Mix Elements
The Marketing Mix Build Image
The set of controllable, tactical marketing tools that the firm
blends to produce the response it wants in the target market.
• Product: Variety, features, brand name, quality, design,
packaging, and services.

• Price: List price, discounts, allowances, payment period, and

credit terms.

• Place: Distribution channels, coverage, logistics, locations,

transportation, assortments, and inventory.
• Promotion: Advertising, sales promotion, public relations, and
personal selling.

Traditional Approach to Marketing Contemporary IMC Approach

Communications

Sales Sales Direct

Packaging
Publicity promotion promotion response
Point of
purchase

Media Packaging Media

Point of
Special Adver- purchase Adver-
Public
events tising tising relations
Direct Publicity
response
Public
relations Interactive
Interactive marketing Direct
Special
Direct marketing marketing
events
marketing

3
 Defining IMC A Contemporary Perspective of IMC

IMC is a strategic business

process used to plan, develop,
execute and evaluate coordinated, Recognized as a business process
measurable, persuasive brand
communication programs with
consumers, customers, prospects IMC Importance of relevant
Multiple relevant audience
audiences
employees and other relevant
external and internal audiences. Demand for accountability and
Demand for accountability
Measurement of Outcomes
The goal of IMC is to
generate short-term
financial returns and build
long-term brand value.

Reasons for the Growing Importance of

IMC and Branding
IMC
From Toward Rank Brand Brand Value
Brand Identity is a
Media advertising Multiple forms of communication combination of factors:
1 Apple Inc. 182.95 bn
Name, logo, symbols,
Mass media Specialized media design, packaging, 2 IBM Corp. 115.96 bn

product or service 3 Google Inc. 107.86 bn

Manufacturer dominance Retailer dominance
performance, and image 4 McDonald’s Corp. 95.19 bn

or associations in the 5 Microsoft Corp. 76.65 bn

General focus Data-based marketing
consumer’s mind. 6 Coca-Cola Co. 74.29 bn

Low agency accountability Greater agency accountability 7 Marlboro 73.61 bn

IMC plays a major role 8 AT&T Inc. 68.87 bn

Traditional compensation Performance-based compensation in the process of 9 Verizon Inc. 49.15 bn
developing and
10 China Mobile Ltd. 47.04 bn
Limited Internet availability Widespread Internet availability sustaining brand
identity and equity.

4
 The Promotional Mix: The Tools for IMC Basic Elements of the Promotional Mix

• Promotion has been defined as the coordination of all seller-

Advertising
initiated efforts to set up channels of information and persuasion
to sell goods and services or promote an idea Direct Marketing

Interactive/
• The basic tools used to accomplish an organization’s Internet Marketing
communication objectives are often referred to as the
Sales Promotion
promotional mix
Publicity/Public
Relations

Personal Selling

Advertising Classifications of Advertising

• Advertising is defined as a paid, non-personal communication
about an organization, product, service or idea transmitted National Advertising
through out-of-store mass media by an identified sponsor
Retail/Local Advertising
4 Key aspects of the definition:
Primary vs. Selective
• Paid form: this distinguishes advertising from publicity (an Demand Advertising
element of public relations) Consumers

• Non-personal presentation: a standard message is delivered to Business-to-Business Advertising

the entire audience
Professional Advertising
• Out-of-store mass media: these include newspapers, radio, TV,
web & other mass channels, rather than personal contacts
Trade Advertising
• Identified sponsor: the sponsor’s name is clearly revealed Organizations

5
 Classifications of Advertising Classifications of Advertising
• National Advertising: done by large companies on a nationwide
• Business to business advertising – advertising that targets
basis. Ads for well-known brands and companies shown on television
individuals who buy or influence the purchase of industrial goods or
are an example
services for their companies.
• Retail/Local Advertising: done by retail and local merchants
encouraging consumers to shop at a specific store, use a local service, or
• Professional advertising – advertising targeted to professionals such
patronize a particular establishment
doctors, lawyers, engineers, and the like.
• Primary vs. Selective Demand Advertising: primary demand
advertising is designed to stimulate demand for the general product class
• Trade advertising – targeted to marketing channel members such as
or industry. Selective-demand focuses on creating demand for a specific
wholesalers, distributors, and retailers
company and/or its brands

Advantages Disadvantages

• Cost-effective way for communicating especially with large • Cost of producing and placing ads can be very high
audiences • Can be difficult to determine the effectiveness of advertising
• Ability to create images and symbolic appeals and for • Vast number of ads has created clutter problems associated with
differentiating similar products and services advertising
• Valuable tool for creating and maintaining brand equity
• Ability to strike responsive chord with audience through creative
advertising
• Ability to control the message (what, when and how something is
said and where it is delivered)

6
 Direct Marketing Direct Marketing is Part of IMC

Direct
Direct marketing is a form of integrated marketing communications
Mail
whereby an organization communicates directly with target
Internet Direct
Response
Sales Advertising
customers to generate a response and/or transaction. It involves a
Direct
variety of activities Marketing
Shopping
Telemarketing
Channels

Catalogs

Bose Uses Direct Response Advertising Advantages

• Consumers are more receptive of direct marketed products

• Allows a company to be very selective and target its marketing
communications to specific consumer segments
• Messages can be customized to fit the needs of specific market
segments
• Effectiveness of direct marketing efforts are easier to assess than
other forms of promotion

7
 Disadvantages Interactive/Internet Marketing

• Consumers and businesses are being bombarded with unsolicited

• Interactive media allow for a back and forth flow of information
mail and phone calls which makes them less receptive to direct
whereby users can participate in and modify the content of the
marketing
information they receive in real time
• Direct marketing has image problems
• Major interactive medium is the internet
• Problems with clutter as there are too many direct-marketing
messages

Sharp Creatively Integrated Advertising

Using the Internet as an IMC Tool
and the Internet

The
Internet

Educates or A persuasive A sales tool

informs advertising or an actual
customers medium sales vehicle

Obtains Provides Builds and

Communicates
customer customer maintains
and interacts
database service and customer
with buyers
information support relationships

8
 Advantages Disadvantages
• The internet can be used for a variety of IMC functions including
advertising, direct marketing, sales promotion public relations • The internet is not yet a mass medium
• Internet can be used to target very specific groups of customers • Many internet users do not pay attention to banner ads and
with a minimum of waste click through rate is very low
• Messages can be tailored to appeal to the specific interests and • Audience measurement for the internet is still a problem
needs of the target audience
• Interactive nature of internet leads to a higher degree of customer
involvement
• Internet makes it possible to provide customers with a great deal of
information regarding product and service description,
specifications, purchase information etc

Sales Promotion Sales Promotion Tools

• Those marketing activities that provide extra value or incentive to

Coupons
the sales force, distributors or the ultimate consumer and can
Samples
stimulate immediate sales. POP Displays
Contests
• Sales promotion is generally broken into two major categories: Training
Refunds/Rebates Programs
consumer oriented and trade oriented activities Bonus Packs Trade
Shows
Loyalty Programs
Coop
Events Advertising

• Consumer- • Trade-
oriented oriented
• [For end-users] • [For resellers]

9
 Various Uses of Sales Promotion Advantages

Introduce new Get existing

products customers to buy • Provides extra incentive to consumer or middlemen to purchase
more
or stock

Combat Attract new • Way of appealing to price sensitive consumer

competition customers
• Way of generating extra interest in product or ads
Sales
Promotion • Effects can often be more directly measured than those of
Enhance Maintain sales in
personal selling off season
advertising

Tie in advertising
Increase retail
& personal
selling inventories

Disadvantages Publicity/Public Relations

Publicity:
• Many companies are becoming too reliant on sales
promotion and focusing too much on short run marketing • Refers to nonpersonal communications about an organization,

• Most of the times it does not help establish or reinforce product, service or idea that is not directly paid for nor run under

brand image and short term gains are often achieved at the identified sponsorship

expense of long term brand equity • In the form of news story, editorial or announcement about an
• Sales promotion clutter (too many coupons, contests etc.) organization and/or its products & services
• Consumers may become over reliant on sales promotion

10
 Publicity/Public Relations Advertising Versus Publicity

Public Relations: Factor Advertising Publicity

• A management function which evaluates public attitudes,
Control Great Little
identifies the public policies and procedures of an individual or
Credibility Lower Higher
organization with the public interest, and executes a program of
action to earn public understanding and acceptance Reach Measurable Undetermined

Frequency Schedulable Uncontrollable

Cost High/Specific Low/Unspecified

Flexibility High Low

Timing Specifiable Tentative

Publicity Vehicles Public Relations Tools

Feature
Publicity Special
Articles
Vehicles Publications

News
Interviews
Releases Publicity Community Corporate Cause-related
Vehicles Activities Advertising Marketing

Press Public Affairs Special Event

Special
Conferences Events Activities Sponsorship

11
 Advantages Disadvantages

• Credibility of publicity is usually higher than other forms of • Lack of control over what is said, when, where and how it is

marketing communication said

• Low cost way of communicating • Can be negative at times

• Often has news value and generates word of mouth discussion

among consumers

Personal Selling Advantages

• A form of person to person communication in which a seller
attempts to assist or persuade prospective buyers to purchase the
company’s product or service or to act on an idea
• Unlike advertising, personal selling involves direct contact
between buyer and seller
• Direct contact allows for more communication flexibility
• Can tailor and adapt message to specific needs or situation of the
customer
• Allows for more immediate and direct feedback
• Promotional efforts can be targeted to specific markets and
customers who are best prospects

12
 Disadvantages IMC Audience Contact Tools

Broadcast Print media Public

• High cost per contact (newspapers, Internet/
media Relations/
interactive
(TV/radio) magazines) publicity
• Expensive way to reach large audiences
• Difficult to have consistent and uniform message delivered
Out-of-home Direct
to all customers media marketing

Target Audience
Personal Sales
selling Promotion

Point-of-
Product
purchase Word-of- Events and
placements
(displays, mouth sponsorship (TV and movies)
packaging)

The IMC Planning Process

• Integrated marketing communications management is defined
as the process of planning, executing, evaluating and controlling
the use of various promotional mix elements to effectively
communicate with target audiences
• This process is guided by the development of 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
• The first step in the IMC planning process is to review the
marketing plan and objective.
• Before developing a promotional plan, marketers must understand
where the company (or brand) has been, its current position in the
market, where it intends to go, and how it plans to get there.
• Most of this information should be contained in the marketing
plan.
• Marketing plans can take several forms, but general include the
following five basic elements:

13
 The Marketing Plan 1) A detailed situation analysis, which includes an internal
marketing audit and review and an external analysis of the market
competition and environmental factors.

1. A detailed situation analysis 2) Specific marketing objectives that provide direction, a time
frame for marketing activities, and a mechanism for measuring
performance.
2. Specific marketing objectives
3) A marketing strategy and program that includes selection of
target markets and plans for the four elements of the marketing mix
3. A marketing strategy and program
4) A program for implementing the strategy, including
determining specific tasks to be performed and responsibilities.
4. A program for implementing the strategy
5) A process for monitoring and evaluating performance and
providing feedback so proper control can be maintained and
necessary changes can be made in the overall marketing strategies
5. A process for monitoring and evaluating performance
and tactics.

Integrated Marketing Communications Planning Model Review of Marketing Plan

Review of marketing plan
• Examine overall marketing plan and objectives
Promotional program situation analysis
Analysis of the communications process • Identify the role of advertising and promotion
Budget determination • Competitive Analysis
Develop integrated marketing communications programs
• Assess environmental influences
Sales PR/ Personal Direct Internet/
Advertising
promotion publicity selling marketing interactive

Advertising Sales PR/ Personal Direct Internet/

promotion publicity selling marketing interactive
objectives objectives objectives objectives objectives objectives

Message Sales PR/ Personal Direct Internet/

promotion publicity selling marketing interactive
strategy strategy strategy strategy strategy strategy

Integrate and implement marketing communications strategies

Monitor, evaluate and control IMC Program

14
 Analysis of Promotional Program Situation Analysis of Communication Program

Internal Analysis External Analysis • Analyze receiver’s response process

• Promotional department • Consumer behavior analysis • Analyze source, message, channel factors

organization • Market segmentation and • Establish communication goals and objectives

• Firm’s ability to implement target marketing

promotional program • Marketing positioning
• Agency evaluation and
selection

• Review of previous program

results

Budget Determination Develop Integrated Marketing Communications Program

• Set tentative marketing communications budget Advertising Interactive/Internet Marketing

• Set advertising objectives • Set Interactive/Internet
• Allocate tentative budget • Determine advertising budget Marketing objectives
• Develop advertising message • Determine Interactive/Internet
• Develop advertising media Marketing budget
strategy • Develop Interactive/Internet
Marketing message
• Develop Interactive/Internet
Marketing media strategy
Direct Marketing
• Set direct marketing objectives
• Determine direct marketing budget
• Develop direct marketing message
• Develop direct marketing media
strategy

15
 Develop Integrated Marketing Communications Program Integrate & Implement Communications Strategies
Sales Promotion PR/Publicity
• Set Sales Promotion • Set PR/Publicity objectives • Integrate promotional mix strategies
objectives • Determine PR/Publicity
• Create and produce ads
• Determine Sales Promotion budget
budget • Develop PR/Publicity message • Purchase media time and space
• Develop Sales Promotion • Develop PR/Publicity media
message strategy • Design and implement direct-marketing programs
• Develop Sales Promotion
• Design and distribute sales promotion materials
media strategy
• Design and implement public relations/publicity programs
Personal Selling
• Set Personal Selling objectives • Design and implement interactive/internet marketing programs
• Determine Personal Selling budget
• Develop Personal Selling message
• Develop Personal Selling media strategy

Monitor, Evaluate and Control IMC Program

• Evaluate promotional program results/effectiveness

• Take measures to control and adjust promotional strategies

16