Integrated Marketing Communications

• identify and describe the components of the communication process (source, coding, etc.) and they relate to one another

Communication – sharing of meaning.

A source – is a person, group, or organization with a meaning it tries to share.

Receiver – the individual, group, or organization that decodes a coded message.

Coding process – converting meaning into a series of signs and symbols.

Communications channel – the medium of transmission that carries the coded message from the source to the receiver or audience.

Decoding process- converting signs and symbols into concepts and ideas.

Noise – anything that reduces a communication’s clarity and accuracy.

Feedback- the receiver’s response to a message.

Channel capacity- the limit on the volume of information a communication channel can handle effectively.

• understand the objectives of promotion (create awareness, stimulate demand, etc.)

Create awareness – making customers aware of the new product or line extension. Crucial to generate revenues to offset the high costs of product development and introduction. Informs customers that product exists.

Stimulate demand – demand for product category rather than a specific brand of product through pioneer promotion. Pioneer promotion – promotion that informs consumers about new product.

Encourage product trial – free samples, coupons, test drives or limited re-use offers, contests, and games, are employed to encourage product trial.

Identify prospects – certain types of promotion efforts are directed at identifying customers who are interested the firm’s product and most likely to buy it.

Retain loyal customers – promotional efforts directed at customer retention can help an organization control its costs because the costs of retaining customers are usually considerably lower than those of acquiring new ones.

Facilitate reseller support- producers usually want to provide support to resellers to maintain sound working relationships, and in turn, they expect resellers to support their products.

Combat competitive promotional efforts – this type of promotional activity does not necessarily increase the organizations’ sales or market share, but it may prevent a sales or market share loss.

Reduce sales fluctuations – promotional techniques are usually designed to stimulate sales during sales slumps.

• components in the promotion mix (advertising, public relations, sales promotion, personal selling)

Promotion mix – a combination of promotional methods used to promote a specific product.

Advertising – is a paid nonpersonal communication about an organization and its products transmitted to a target audience through mass media, including television, radio , the internet, newspapers, magazines, direct mail, outdoor displays, and signs on mass transit vehicles.

Personal selling – is paid personal communication that seeks to inform customers and persuade them to purchase products in an exchange situation.

Public relations – implied to communicate with customers and stakeholders. It is a broad set of communication efforts used to create and maintain favorable relationships between an organization and its stakeholders. Public relations use various tools, including annual reports, brochures, even sponsorship, and sponsorship of socially responsible programs aimed at protecting the environment or helping disadvantaged individuals.

Sales promotion – is an activity or material that acts as direct inducement, offering added value or incentive for the product to resellers, salespeople, or consumers. Examples included free samples, games, rebates, displays, sweepstakes, contests, premiums, and coupons.

• understand how push and pull strategies work (product and communication flows)

Push policy – promoting a product only to the next institution down the marketing channel.

Pull policy – promoting a product directly to consumers to develop strong consumer demand that pulls products through the marketing channel.

• understand product placement vs. product integration (see lectures notes for information on product integration)

Product placement – the strategic location of products or product promotions within television program content to reach the product’s target market.

Product Integration In order to augment revenues, some networks and studios are working with advertisers and including products or what amount to product endorsements into the actual content of programs. So-called 'product integration' forces content creators to become ad writers.

Advertising and Public Relations

• know the alternative types of advertising objectives (advocacy, product, etc.)

Institutional advertising – promotes organizational images, ideas, and political issues.

• Advocacy advertising- promotes a company’s position on public issue. (Tax increase, abortion, gun control).

Product advertising promotes products’ uses, features, and benefits.

• Pioneer advertising – tries to stimulate demand for a product category( rather than a specific brand) by informing potential buyers about the product.

• Competitive advertising tries to stimulate demand for a specific brand by promoting its features, uses, and advantages).

• Comparative advertising compares the sponsored brand with one or more identified brands on the basis of one or more product characteristics.

• Reminder advertising reminds consumers about an established brand’s uses, characteristics, and benefits.

• Reinforcement advertising assures they chose the right brand and tells them how to get the most satisfaction from it.

• identify communication appeals (rational, emotional, moral) used in advertising

Rational – quality, dependability, nature.

Emotional :

• Negative- fear, shame, guilty

• Positive – humor.

Moral - donation

• understand the alternative budgeting approaches for advertising (affordable, competition-matching, etc.)

Percent-of-sales approach – budgeting for an advertising campaign by multiplying the firms past or expected sales by a standard percentage.

Competition-matching approach – determining an advertising budget by trying to match competitors’ ad outlays.

Arbitrary approach – budgeting for an advertising campaign as specified by a high-level executive in the firm.

• developing a media plan

  • understand reach and frequency

  • understand the difference between medium (media class) and media vehicle

Print – media, magazine – vehicle.

• characteristics, advantages, and disadvantages of alternative advertising mediums (television, radio, direct mail, etc.)

• be able to calculate and interpret CPM (Cost comparison indicator) – a means of comparing the cost of vehicles in a specific medium to the number of people reached.

CPM=Cost of Ad*1000/total audience

• the three general types of media schedules (continuous, flighting, pulsing)

Continuous - --------

Flighting – seasonal

Pulsing – combination of both.

• techniques used to evaluate advertising (pretest, posttest); posttest has subtypes

• Pretest – evaluation of ads performed before a campaign begins.

• Posttest – evaluation of advertising effectiveness after the campaign.

Recognition test- a posttest in which individuals are shown the actual ad and asked if they recognize it.

Recall test:

Unaided – a posttest in which respondents identify ads they have recently seen but are given no recall clues.

Aided- a posttest that asks respondents to identify recent ads and provides clues to jog their memories.

• distinguish among types of public relations tools (publicity, news release, etc.)

Publicity – a news story type of communication transmitted through a mass medium at no charge.

News release – a short piece of copy publicizing an event or a product.

Feature article – a manuscript of up to 3000 words prepared for a specific publication.

Captioned photograph – a photo with a brief description of its contents.

Press conference – a meeting used to announce major new events.

Personal Selling and Sales Promotion

• types of salespeople (order takers, order getters, etc.)

Order getters – the salesperson who sells to new customers and increases sales to current ones.

Order takers – salesperson who primarily seek repeat sales.

Support personnel- sales stuff members who facilitate selling but usually are not involved solely with making sales.

• sales force compensation plans (straight salary, etc.)

Straight salary compensation plan- paying salespeople a specific amount per time period, regardless of selling effort.

Straight commission compensation plan – paying salesperson according to the amount of their sales in a given period of time.

Combination compensation plan – paying salesperson a fixed salary plus a commission based on sales volume.

• identify and describe the alternative consumer sales promotion tools (coupons, rebates, etc.)

Coupons – written price reductions used to encourage consumers to buy a specific product.

Cents-off offer – a promotion that’s lets buyers pay less than the regular price to encourage purchase.

Money refunds – a sales promotion technique offering consumers money when they mail in a proof of purchase, usually for multiple product purchases.

Rebates – a sales promotion technique whereby a customer is sent a specific amount of money for purchasing a single product.

Point of purchase materials – signs, window displays, display racks and similar means used to attract customers.

Demonstrations - a sales promotion method manufacture use temporarily to encourage trial use and purchase of a product or to show how a product works.

Free samples- samples of a product given out to encourage trial and purchase.

Premiums – items offered free or a t a minimal cost as a bonus for purchasing a product.

Consumer contests- sales promotion methods in which individuals compete for prized based on analytical or creativity skills.

Consumer games- sales promotion method in which individuals compete for prizes based primarily on chance.

Consumer sweepstakes – sales promotion in which entrants submit their names for inclusion in a drawing for prizes.

• identify and describe the alternative trade sales promotion tools (trade allowances, sales contests, etc.)

Trade allowance:

• Buying allowance – a temporary price reduction to resellers for purchasing specified quantities of a product.

• Buy-back allowance – a sum of money given to a reseller for each unit bought after an initial promotion deal is over.

• Scan- back allowance – a manufactures’ reward to retailers

• Merchandise allowance – a manufactures agreement to pay resellers certain amount of money for providing special promotion efforts.

Cooperative adverting and dealer listing :

Cooperative advertising – an arrangement in which a manufacture agrees to pay a certain amount of a retailer’s media costs for advertising the manufacturers’ products.

Dealer listings – advertisements that promote a product and identify the names of participating retailers that sell the product.

Free merchandise and gifts:

Free merchandise – a manufactures reward given to resellers for purchasing a stated quantity of products.

Dealer loader – a gift, often a party of a display, given to a retailer purchasing a specified quantity of merchandise.

Premium money – extra compensation to salesperson for pushing a line of goods.

Sales contest – a promotion method used to motivate distributors, retailers, and sales personnel through recognition of outstanding achievements.

Other

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