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Integrated Marketing Communications and Direct Marketing

This chapter discusses integrated marketing communication and its process, the promotional mix and its uniqueness, and the selection of appropriate promotional approaches. It also covers push and pull strategies, the promotion decision process, and the value of direct marketing.

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Integrated Marketing Communications and Direct Marketing

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  1. Slide 18-1

  2. CHAPTER INTEGRATED MARKETING COMMUNICA-TIONS AND DIRECT MARKETING Slide 18-2

  3. AFTER READING THIS CHAPTERYOU SHOULD BE ABLE TO: • Discuss integrated marketing communication and the communication process. • Describe the promotional mix and the uniqueness of each component. • Select the promotional approach appropriate to a product’s life-cycle stage and characteristics. Slide 18-3

  4. AFTER READING THIS CHAPTERYOU SHOULD BE ABLE TO: • Discuss the characteristics of push and pull strategies. • Describe the elements of the promotion decision process. • Explain the value of direct marketing for consumers and sellers. Slide 18-4

  5. THE COMMUNICATION PROCESS • Promotional Mix • Integrated Marketing Communications (IMC) • Communication • Source • Message • Channel of Communication • Receivers Slide 18-6

  6. FIGURE 18-1 The communication process Slide 18-7

  7. THE COMMUNICATION PROCESS • Encoding and Decoding • Encoding • Decoding • Field of Experience Slide 18-8

  8. THE COMMUNICATION PROCESS • Feedback • Feedback Loop • Response • Feedback • Pretesting • Noise Slide 18-10

  9. Concept Check 1. What are the six elements required for communication to occur? A: They are a source, a message,a channel of communication,a receiver, and the processes of encoding and decoding. Slide 18-11

  10. Concept Check 2. A difficulty for U.S. companies advertising in international markets is that the audience does not share the same _______________. field of experience Slide 18-12

  11. Concept Check 3. A misprint in a newspaper ad is an example of _____. noise Slide 18-13

  12. THE PROMOTIONAL ELEMENTS • Mass Selling • Customized Interaction Slide 18-14

  13. FIGURE 18-2 The promotional mix Slide 18-15

  14. THE PROMOTIONAL ELEMENTS • Advertising • Paid Aspect • Nonpersonal Component • Personal Selling • Wasted Coverage Slide 18-16

  15. THE PROMOTIONAL ELEMENTS • Public Relations • Public Relations • Publicity • Sales Promotion • Direct Marketing Slide 18-18

  16. Concept Check 1. Explain the difference between advertising and publicity when both appear on television. A: Since advertising space on TV is paid for,a firm can control what it wants to say and to whom the message is sent. Since publicity is an indirectly paid presentation of a message about a firm or its goods or services, there is little control over what is said to whom or when. Slide 18-20

  17. Concept Check 2. Which promotional element should be offered only on a short-term basis? A: sales promotion Slide 18-21

  18. Concept Check 3. Cost per contact is high with the ____________ element of the promotional mix. personal selling Slide 18-22

  19. FIGURE 18-A Factors that influence the use of promotional tools Slide 18-23

  20. INTEGRATED MARKETING COMMUNICATIONS—DEVELOPING THE PROMOTIONAL MIX • The Target Audience Slide 18-24

  21. INTEGRATED MARKETING COMMUNICATIONS—DEVELOPING THE PROMOTIONAL MIX • The Product Life Cycle • Introduction Stage • Growth Stage • Maturity Stage • Decline Stage Slide 18-27

  22. FIGURE 18-3 Promotional tools used over the product life cycle of Purina Dog Chow Slide 18-28

  23. INTEGRATED MARKETING COMMUNICATIONS—DEVELOPING THE PROMOTIONAL MIX • Product Characteristics • Complexity • Risk • Ancillary Services Slide 18-30

  24. INTEGRATED MARKETING COMMUNICATIONS—DEVELOPING THE PROMOTIONAL MIX • Stages of the Buying Process • Prepurchase Stage • Purchase Stage • Postpurchase Stage Slide 18-32

  25. FIGURE 18-4 How the importance of promotional elements varies during the stages of consumer’s purchase decision Slide 18-33

  26. INTEGRATED MARKETING COMMUNICATIONS—DEVELOPING THE PROMOTIONAL MIX • Channel Strategies • Push Strategy • Pull Strategy • Direct-to-Consumer Slide 18-34

  27. FIGURE 18-5 A comparison of push and pull promotional strategies Slide 18-35

  28. WEB LINK Direct-to-Consumer Drug Marketing Moves to the Internet Slide 18-37

  29. Concept Check 1. Describe the promotional objective for each stage of the product life cycle. A: Introduction—to inform; growth—to persuade; maturity—to remind; and decline—none. Slide 18-38

  30. Concept Check 2. At what stage of the consumer purchase decision is the importance of personal selling highest? Why? A: The purchase stage because salespeople can provide sales assistance to prospective customers and negotiate terms of the sale. Slide 18-39

  31. Concept Check 3. Explain the differences between a push strategy and a pull strategy. A: In a push strategy, a firm directs the promotional mix to channel members to gain their cooperation to carry the product. In a pull strategy, a firm directs the promotional mix at ultimate consumers to encourage them to ask retailers for the product, who then orders it from wholesalers. Slide 18-40

  32. DEVELOPING AN IMC PROGRAM • Identifying the Target Audience • Specifying Promotion Objectives • Hierarchy of Effects • Awareness • Interest • Evaluation • Trial • Adoption Slide 18-41

  33. FIGURE 18-6 The promotion decision process Slide 18-42

  34. DEVELOPING AN IMC PROGRAM • Setting the Promotion Budget • Percentage of Sales Budgeting • Competitive Parity Budgeting (Matching Competitors or Share of Market) • All-You-Can-Afford Budgeting • Objective and Task Budgeting Slide 18-45

  35. FIGURE 18-7 U.S. promotion expenditures by companies in 2003 Slide 18-46

  36. FIGURE 18-8 The objective and task approach Slide 18-47

  37. DEVELOPING AN IMC PROGRAM • Selecting the Right Promotional Tools • Designing the Promotion • Scheduling the Promotion Slide 18-48

  38. EXECUTING AND EVALUATINGTHE PROMOTION PROGRAM • Is Expensive and Time Consuming • Create a Process that Facilitates Its Design and Use • Conduct Pretests and Posttests Slide 18-51

  39. Concept Check 1. What are the characteristics of good promotion objectives? A: Promotion objectives should:(1) be designed for a well-defined target audience, (2) be measurable, and (3) cover a specified time period. Slide 18-52

  40. Concept Check 2. What is the weakness of the percentage of sales budgeting approach? A: The major fallacy is that sales cause promotion. By using this method, a company may reduce its promotion budget because of downturns in actual past or projected future sales—situations where promotion may be needed the most. Slide 18-53

  41. Concept Check 3. How have advertising agencies changed to facilitate the use of IMC programs? A: Some agencies have adopted: (1) a total communications solutions approach;(2) a long-term perspective in which all forms of promotion are integrated; and (3) an IMC audit to analyze the internal communication network of their clients. Slide 18-54

  42. DIRECT MARKETING • The Growth of Direct Marketing • The Value of Direct Marketing • Direct Orders • Lead Generation • Traffic Generation • Technological, Global, andEthical Issues in Direct Marketing Slide 18-55

  43. FIGURE 18-9 Direct marketing expenditures, sales, and employment by medium Slide 18-56

  44. ETHICS AND SOCIAL RESPONSIBILITY ALERT How Do You Like Your E-Mail? “Opt-out” or “Opt-in” Are Your Choices Slide 18-58

  45. Concept Check 1. The ability to design and use direct marketing programs has increased with the availability of ________ and ________. computers databases Slide 18-59

  46. Concept Check 2. What are the three types of responses generated by direct marketing activities? A: They are direct orders, lead generation, and traffic generation. Slide 18-60

  47. AGENCIES ADOPTIMC APPROACHES GOING ONLINE Slide 18-61

  48. Going Online • 1.Go to the digitas.com website and review the case studies.Describe the promotional elements of one of the campaigns. Why were these elements selected? How are they integrated? Slide 18-62

  49. Going Online • 2.How would you evaluate the effectiveness of each of the promotional elements used?How would you evaluate the effectiveness of the entire campaign? Slide 18-63

  50. YAHOO! WINS CAMPAIGN OF THE YEAR WITH INTEGRATED MARKETING COMMUNICATIONS SUPPLEMENTALLECTURE NOTE 18-1 Slide 18-64

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