CH. 17

Learning Objectives

  • Learning Objective 17.1: Identify the components of the communication process.
  • Learning Objective 17.2: Explain the four steps in the AIDA model.
  • Learning Objective 17.3: Describe the various integrative communication channels.
  • Learning Objective 17.4: Explain the methods used to allocate the integrated marketing communications (IMC) budget.
  • Learning Objective 17.5: Identify marketing metrics used to measure IMC success.

Communicating with Consumers

  • Exhibit 17.1: The Communication Process
    • Sender (Firm)
    • Transmitter encodes message
    • Communication channel (Media)
    • Receiver (Consumer) decodes message
    • Noise from the environment
    • Feedback

How Consumers Perceive Communication

  • Receivers decode messages differently.
  • Senders adjust messages according to the medium and receivers’ traits.

The AIDA Model

  • Exhibit 17.2: The AIDA Model. Source: E. K. Strong, The Psychology of Selling(New York: McGraw-Hill Education Global Holdings, 1925)
  • AIDA stands for:
    • Awareness
    • Interest
    • Desire
    • Action

The AIDA Model: Awareness

  • Senders first must gain the attention of the consumer.
  • Awareness metrics include:
    • Aided recall.
    • Top-of-mind awareness.

The AIDA Model: Interest

  • After awareness comes interest.
  • The customer must want to further investigate the product/service.
  • Interest can also be sparked by a little controversy.

The AIDA Model: Desire

  • I like it.
  • I want it.

The AIDA Model: Action

  • The ultimate goal of any form of communications is to drive the receiver to action.
  • But purchase is just one type of action.
  • What other actions can IMC ask consumers to take?

The Lagged Effect

  • Marketing communications do not always have an immediate impact.
  • Multiple exposures are often necessary.
  • It is difficult to determine which exposure led to purchase.

Progress Check 1

  1. What are the different steps in the communication process?
  2. What is the AIDA model?

Channels Used in an IMC Strategy

  • Exhibit 17.3 Channels of an IMC Strategy

Advertising

  • Most visible element of an IMC strategy.
  • Placement of announcements and persuasive messages in time or space purchased by business firms, nonprofit organizations, government agencies, and individuals

Public Relations (PR)

  • “Free” media attention.
  • Importance of PR has grown as the cost of other media has increased.
  • As consumers are becoming more skeptical about marketing, PR is becoming more important.

Sales Promotions

  • Can be aimed at both end-user consumers or channel members.
  • Used in conjunction with other forms of IMC.
  • Can be used for both short-term and long-term objectives.

Personal Selling

  • A two-way communication between the buyer and seller to influence buying decisions.
  • Salespeople can add significant value, which can make the expense worth it.

Direct Marketing

  • Communicating directly with target customers to generate a response or transaction.
  • Growing element of IMC.
  • Improvements in database technology have contributed to the rapid growth.
  • Ability to carefully target consumers.
  • Includes e-mail and mobile marketing.

Examples of Mobile Marketing Campaigns

  • Mazda “Don’t scroll and drive”
    • To tackle the problem of being distracted while driving when using a mobile device, Mazda’s innovative mobile campaign shows a car racing across the screen, a crash, and then a cracked screen on a cell phone.
  • BBC Dr. Who Sidekick
    • When the new season began, the BBC made Dr. Who your mobile sidekick. In the award-winning ad campaign, Dr. Who appears at the bottom of the screen of various high-profile sites. When users clicked on the ad, it would expand and highlight characters of the show.
  • Cheapflights Emoji search
    • Cheapflights launched the first search engine that used emojis. It mapped 40 destinations with popular emojis. For example, Sydney, Australia, was represented by a koala; Dublin, Ireland, was represented with a slice of pizza. The search function was also coupled with a holiday search bot on Facebook Messenger that allowed travelers to search for destinations by weather and currency converter.
  • Justice League The Gillette League
    • When DC’s Justice League came out, it teamed up with Gillette to create the mobile app “Justice League VR: Join the League Gillette Edition. ” The app allowed fans to virtually join the League and become a superhero.
    • Adapted from “5 Best Mobile Campaigns of 2017,” Digital Marketing Institute, https://digitalmarketinginstitute.com/blog/2017-12-18-5-best-mobile- campaigns-of-2017

Online Marketing

  • Websites
  • Blogs
  • Social Media

Online Marketing: Websites

  • Which websites do you visit all the time? Why?

Online Marketing: Blogs

  • Blogs can:
    • communicate trends.
    • announce special events
    • create positive word-of-mouth.
    • connect customers.
    • allow the company to respond to customers.
    • encourage customers to develop a long-term relationship with the company.
  • Blogs are becoming more interactive as the communication between bloggers and customers has increased.
  • Blogs can be linked to other social media.

Online Marketing: Social Media

  • One trend is combining advertising on podcasts with in-home voice assistants.
    • allows users to interact among themselves.
    • provide feedback to their community members.

Progress Check 2

  1. What are the different elements of an IMC program?

Planning for and Measuring IMC Success: Goals

  • Understand the outcome the firm hopes to achieve
  • Short-term or long-term
  • Should be explicitly defined and measured

Examples of Marketing Goals and the Related Campaigns

  • EXHIBIT 17.5 Illustrative Marketing Goals and Related Campaigns
    • ASICS “It’s a big world. Go run it. ”
      • Branch out beyond serious runner market segment and target casual runners.
      • Even split males and females, aged 30-49
      • Television and print ads, online advertising
      • 17% increase in sales
    • Columbia Sportswear Company “Tested Tough”
      • Showcase Columbia’s technical innovation ability.
      • 60% males, aged 20-59
      • Print ads, mobile media, social media, videos, online advertising
      • 11% increase in sales
    • Southwest Airlines “Nonstop Love”
      • To show that Southwest is “an airline with a heart. ”
      • Even split males and females, all ages
      • Television, radio, print, billboard, and in-airport ads
      • 4% increase in revenue
    • BMW “#DrivingLuxury”
      • To highlight the new technology of the redesigned 7 Series sedan.
      • Mostly men, aged 35 and up
      • Social media, blog posts, videos
      • Posts reached up to 13,500 likes on Instagram

Planning for and Measuring IMC Success: Setting and Allocating the IMC Budget

  • Rule-of-thumb methods
  • Objective-and-task method

Exhibit 17.6: Rule-of-Thumb Methods 1

  • Competitive parity
    • Definition: The communication budget is set so that the firm’s share of communication expenses equals its share of the market.
    • Limitations: Does not allow firms to exploit the unique opportunities or problems they confront in a market. If all competitors use this method to set communication budgets, their market shares will stay approximately the same over time.
  • Percentage-of-sales
    • Definition: The communication budget is a fixed percentage of forecasted sales.
    • Limitations: Assumes the same percentage used in the past, or by competitors, is still appropriate for the firm. Does not take into account new plans (e.g., to introduce a new line of products in the current year).

Exhibit 17.6: Rule-of-Thumb Methods 2

  • Available budget
    • Definition: Marketers forecast their sales and expenses, excluding communication, during the budgeting period. The difference between the forecast sales and expenses plus desired profit is reserved for the communication budget. That is, the communication budget is the money available after operating costs and profits have been budgeted.
    • Limitations: Assumes communication expenses do not stimulate sales and profit.

Planning for and Measuring IMC Success: Measuring Success Using Marketing Metrics

  • Reach
  • Frequency
  • Gross rating points
  • Web tracking

Planning, Implementing, and Evaluating IMC Programs—An Illustration of Google Advertising

Transit is an upscale sneaker store in New York City modeled after vintage New York City subway trains.

Exhibit 17.7: Transit ROMI Assessment

  • ROMI: Return on Marketing Investment
  • ROMI=((Gross Margin−Marketing Expenditure)/Marketing Expenditure)∗100ROMI = ((Gross\ Margin - Marketing\ Expenditure) / Marketing\ Expenditure) * 100
  • Sneaker store
    • Clicks: 110
    • Marketing Expenditure: $10/day
    • Sales: $70/day
    • Gross Margin = Sales X Gross Margin % = Sales X 50 %: $35/day
    • Gross Margin ($) (Col. 5) – Marketing Expenditure (Col 3): $25
    • ROMI = (Col. 6/Col. 3) X 100: 250%
  • New York City sneakers
    • Clicks: 40
    • Marketing Expenditure: $25/day
    • Sales: $80/day
    • Gross Margin = Sales X Gross Margin % = Sales X 50 %: $40/day
    • Gross Margin ($) (Col. 5) – Marketing Expenditure (Col 3): $15
    • ROMI = (Col. 6/Col. 3) X 100: 60%

Exhibit 17.8: Program Effectiveness Results

  • Communication Objective: Awareness (% mentioning store)
    • Question: What stores sell sneakers?
    • Before Campaign: 38%
    • Six Months After: 46%
    • One Year After: 52%
  • Communication Objective: Knowledge (% giving outstanding rating for sales assistance)
    • Question: Which stores would you rate outstanding on the following characteristics?
    • Before Campaign: 9
    • Six Months After: 17
    • One Year After: 24
  • Communication Objective: Attitude (% first choice)
    • Question: On your next shopping trip for sneakers, which store would you visit first?
    • Before Campaign: 13
    • Six Months After: 15
    • One Year After: 19
  • Communication Objective: Visit (% visited store)
    • Question: Which of the following stores have you been to?
    • Before Campaign: 8
    • Six Months After: 15
    • One Year After: 19

Progress Check 3

  1. Why is the objective-and-task method of setting an IMC budget better than the rule-of-thumb methods?
  2. How do firms use GRP to evaluate the effectiveness of traditional media?
  3. How would a firm evaluate the effectiveness of its Google advertising?