Integrated Marketing Communications Review

Learning Objectives

• Define market segmentation and describe its purposes.

• Explain the target marketing process.

• Show how IMC (Integrated Marketing Communications) is used with the product element in marketing.

• Illustrate IMC's application with pricing strategies.

• Review IMC's usage within distribution channels.

• Discuss IMC's role in communication strategies in marketing.

Market Segmentation Overview

• Definition: The process of dividing a total population into segments based on shared needs and characteristics.

• Purpose: To identify and target specific groups more effectively, ensuring that marketing messages resonate with consumers’ interests.

Steps in Market Segmentation

1. Identifying Groups: Recognizing groups of people (or organizations) with shared characteristics.

2. Aggregating Segments: Combining these groups into larger market segments based on their interest in a product's utility to create targeted marketing strategies.

Types of Market Segmentation

1. Behavioristic Segmentation

• Focuses on consumer buying behavior rather than lifestyle.

• Key elements:

  • User Status: Categories like sole users, discounted users, etc.

  • Usage Rates: Classification into light, medium, and heavy users.

  • Purchase Occasions: Specific times when purchases are made (e.g., seasonal products).

  • Benefits Sought: Identifying the reasons why consumers buy a product.

1. Geographic Segmentation

• Segmentation based on geographic variables such as:

  • Regions (e.g., country, state, city).

  • Population density (urban vs rural).

  • Specific locations (zip codes).

• Example: The PRIZM system used for demographic insights.

1. Demographic Segmentation

• Categorizes consumers based on statistical characteristics:

  • Age, gender, income, education, ethnicity.

  • Trend insights, e.g., Millennials (18-34) influencing market trends.

• Can provide more targeted marketing when combined with geographic information (geodemographic segmentation).

1. Psychographic Segmentation

• Groups consumers based on psychological criteria such as values, attitudes, and lifestyle.

• Notable systems:

  • VALS: Defines consumers by primary motivation (ideals, achievement, self-expression).

  • MindBase: Groups consumers into eight psychological categories.

• Helps marketers understand the emotional and psychological influences behind purchasing decisions.

Target Marketing Process

• Target Market Selection: Identifying segments to focus on based on profit potential and accessibility.

• The Marketing Mix: Integrates four Ps:

• Product: Conceptualization to meet both functional and symbolic needs.

• Price: Strategies to balance consumer perceptions, competition, and production costs.

• Place (Distribution): Strategies for direct or indirect distribution; types of distribution strategies include intensive, selective, and exclusive.

• Promotion: All communication strategies that engage consumers, including advertising, sales promotions, public relations, etc.

IMC with the Product Element

• Product Life Cycle: Four major stages of a product:

1. Introduction: Aiming to stimulate demand.

2. Growth: Rapid market expansion.

3. Maturity: Market saturation.

4. Decline: Shift in consumer preferences or product obsolescence.

• Product Classification: Classifies products based on several attributes such as consumer goods vs industrial goods.

• Product Differentiation: Critical for establishing market positioning; can be perceptible, hidden, or induced.

• Branding Importance:

• Differentiates products, builds identity, and establishes brand loyalty.

• Types of brands: national, private label, licensed.

IMC with Price

• Pricing Factors: Demand, costs, competition, corporate objectives, and external influences.

• Pricing perceptions directly affect brand image and consumer decision-making.

IMC with Distribution (Place)

• Distribution Channels: Choosing between direct and indirect distribution, with strategies based on market reach and availability.

IMC with Promotion (Communication)

• Communication Strategy: Incorporates various marketing communications tools:

• Personal selling, advertising, direct marketing, public relations, and sales promotions.

Conclusion

Understanding market segmentation, target marketing, and the application of IMC across the marketing mix is fundamental for creating effective marketing strategies that connect with different consumer groups and effectively position products in the marketplace.