LEARNING OBJECTIVES (LO) AFTER READING CHAPTER 17, YOU SHOULD BE ABLE TO:
Discuss integrated marketing communication and the communication process.
Describe the promotional mix andthe uniqueness of each component.
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McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.LO1Discuss integrated marketing communication and the communication process.Describe the promotional mix andthe uniqueness of each component.LO2LEARNING OBJECTIVES (LO)AFTER READING CHAPTER 17, YOU SHOULD BE ABLE TO:LO4Describe the elements of the promotion decision process.Explain the value of direct marketing for consumers and sellers.LO5LEARNING OBJECTIVES (LO)AFTER READING CHAPTER 17, YOU SHOULD BE ABLE TO:Select the promotional approach appropriate to a product’s target audience, life-cycle stage, and characteristics, as well as stagesof the buying decision and channel strategies.LO3GET ENGAGEDIN THE TWITTERVERSE!Age of EngagementTHE COMMUNICATION PROCESSLO1Promotional MixIntegrated Marketing Communications (IMC)Inform Prospective BuyersPersuade Them To TryRemind Them of the BenefitsFIGURE 17-1 The communication process consists of six key elementsTHE COMMUNICATION PROCESSLO1CommunicationSourceChannel of CommunicationMessageReceiversEncodingDecodingField of ExperienceFeedback LoopFeedbackResponseNoiseTHE COMMUNICATION PROCESSLO1The North Face AdWho is the source? What is the message?How would you decode this ad?LO1FIGURE 17-2 The five elements of the promotional mixTHE PROMOTIONAL ELEMENTSADVERTISINGLO2MassSellingCustomizedInteractionAdvertisingPaid AspectNonpersonalvs.AdvantagesDisadvantagesTHE PROMOTIONAL ELEMENTSPERSONAL SELLINGLO2Personal SellingWasted CoverageAdvantagesDisadvantagesTHE PROMOTIONAL ELEMENTSPUBLIC RELATIONSLO2Public RelationsPublicityAdvantagesDisadvantagesTHE PROMOTIONAL ELEMENTSSALES PROMOTION AND DIRECT MARKETINGLO2Sales PromotionDirect MarketingAdvantagesDisadvantagesAdvantagesDisadvantagesIMC—DEVELOPING THE PROMOTIONAL MIXTHE TARGET AUDIENCEDetermine the Balance of the ElementsCoordinate the Promotional Effort LO2Assess Target Audience Characteristics ConsumersBusinessesMARKETING MATTERSHow Can You Reach Generation Y?With Mobile Marketing!LO2Introduction StageGrowth StageMaturity StageDecline StageIMC—DEVELOPING THE PROMOTIONAL MIXTHE PRODUCT LIFE CYCLELO3FIGURE 17-3 Promotional tools used over the product life cycle of Purina Dog ChowComplexityRiskAncillary ServicesIMC—DEVELOPING THE PROMOTIONAL MIXPRODUCT CHARACTERISTICSLO3Prepurchase StagePurchase StagePostpurchase StageIMC—DEVELOPING THE PROMOTIONAL MIXSTAGES OF THE BUYING DECISIONLO3FIGURE 17-4 How the importance of promotional elements varies during the stages of the consumer purchase decision processPush StrategyPull StrategyDirect-to-ConsumerIMC—DEVELOPING THE PROMOTIONAL MIXCHANNEL STRATEGIESLO3FIGURE 17-5 A comparison of push and pull promotional strategiesFIGURE 17-6 The promotion decision process includes planning, implementation, and evaluationThe Four “W”s:DEVELOPING AN IMC PROGRAMDEVELOPING THE PROMOTION PROGRAMLO4Who is the Target Audience?What are the Objectives, Budget, & Tools?Where Should the Promotion Be Run?When Should the Promotion Be Run?DEVELOPING AN IMC PROGRAMIDENTIFYING THE TARGET AUDIENCELO4Target AudienceBehaviorial TargetingDEVELOPING AN IMC PROGRAMSPECIFYING THE PROMOTION OBJECTIVESLO4AwarenessTrialInterestAdoptionEvaluationHierarchy of EffectsDEVELOPING AN IMC PROGRAMSETTING THE PROMOTION BUDGETLO4Percentage of Sales BudgetingCompetitive Parity BudgetingAll-You-Can-Afford BudgetingObjective and Task BudgetingMatching CompetitorsShare of MarketFIGURE 17-7 U.S. promotion expenditures of the top 10 companiesUSING MARKETING DASHBOARDSHow Much Should You Spend on IMC?Promotion-to-Sales RatioLO4DEVELOPING AN IMC PROGRAMLO4Designing the PromotionSelecting the Right Promotional ToolsScheduling the PromotionEXECUTING AND ASSESSINGTHE PROMOTION PROGRAMLO4IMC AuditPretestingPosttestingDIRECT MARKETINGLO5The Value of Direct MarketingTechnological, Global andEthical Issues in Direct MarketingThe Growth of Direct MarketingDirect OrdersTraffic GenerationLead GenerationPriceline AdFIGURE 17-8 Business usage and response rates of popular forms of direct marketingMAKING RESPONSIBLE DECISIONSWhat Information Should Be Private”LO5DMADo-Not-CallDo Not MailDo Not TrackE-Privacy DirectiveMOUNTAIN DEW: USING IMC AND SOCIAL MEDIA TO CREATE AND PROMOTE A NEW FLAVORVIDEO CASE 17FIGURE 1 The seven stages of the Dewmocracy 2 campaignVIDEO CASE 17MOUNTAIN DEW1. What changes in the environment provided the opportunity for the Dewmocracy approach?VIDEO CASE 17MOUNTAIN DEW2. Which of the promotional elements described in Figure17-2 are used by Mountain Dew in its Dewmocracy 2 campaign?VIDEO CASE 17MOUNTAIN DEW3. What are some of the different ways Mountain Dew can assess the success of its campaign?Promotional MixThe promotional mix is the combination of one or more communication tools used to: (1) inform prospective buyers about the benefits of the product, (2) persuade them to try it, and (3) remind them later about the benefits they enjoyed by using the product.Integrated Marketing Communications (IMC)Integrated marketing communications (IMC) is the concept of designing marketing communications programsthat coordinate all promotional activities—advertising, personal selling, sales promotion, public relations, and direct marketing—to provide a consistent message across all audiences.CommunicationCommunication is the processof conveying a message to others and that requires six elements:a source, a message, a channelof communication, a receiver,and the processes of encoding and decoding.SourceA source is a company or person who has information to convey during the communication process.MessageA message consists of the information sent by a sourceto a receiver during the communication process.Channel of CommunicationA channel of communicationis the means (e.g., a salesperson, advertising media, or public relations tools) of conveying a message to a receiver during the communication process.ReceiversReceivers consists of consumers who read, hear, or see the message sent by a source during the communication process.EncodingEncoding is the process ofhaving the sender transform an idea into a set of symbols during the communication process.DecodingDecoding is the process ofhaving the receiver take a set of symbols, the message, and transform them back to an idea during the communication process.Field of ExperienceField of experience is amutually shared understanding and knowledge that the a sender and receiver apply to a message so that it can be communicated effectively during the communication process.ResponseA response, in the feedbackloop, is the impact the message had on the receiver’s knowledge, attitudes, or behaviors during the communication process.FeedbackFeedback, in the feedback loop, is the sender’s interpretation ofthe response, which indicates whether a message was decoded and understood as intended during the communication process.NoiseNoise consists of extraneous factors that can work against effective communication by distorting a message or the feedback received during the communication process.AdvertisingAdvertising is any paid formof nonpersonal communicationabout an organization, good, service, or idea by an identified sponsor.Personal SellingPersonal selling consists of the two-way flow of communication between a buyer and seller, often in a face-to-face encounter, designed to influence a person’s or group’s purchase decision.Public RelationsPublic relations is a form of communication management that seeks to influence the feelings, opinions, or beliefs held by customers, prospective customers, stockholders, suppliers, employees, and other publics about a company and its products or services.Publicity is a nonpersonal, indirectly paid presentation of an organization, good, or service.PublicitySales PromotionSales promotion is a short-term inducement of value offered to arouse interest in buying a good or service.Direct MarketingDirect marketing is a promotion alternative that uses direct communication with consumersto generate a response in theform of an order, a request for further information, or a visit toa retail outlet.Push StrategyA push strategy involves directing the promotional mix to channel members to gain their cooperation in ordering and stocking the product.Pull StrategyA pull strategy involves directing the promotional mix at ultimate consumers to encourage themto ask the retailer for a product.Hierarchy of EffectsThe hierarchy of effects is the sequence of stages a prospective buyer goes through from initial awareness of a product to eventual action (either trial or adoption of the product). The stages include awareness, interest, evaluation,trial, and adoption.Percentage of Sales BudgetingPercentage of sales budgeting involves allocating funds to promotion as a percentage ofpast or anticipated sales, in terms of either dollars or units sold.Competitive Parity BudgetingCompetitive parity budgeting involves allocating funds to promotion by matching the competitor’s absolute level of spending or the proportionper point of market share. Also called matching competitors or share of market.All-You-Can-Afford BudgetingAll-you-can-afford budgeting involves allocating funds to promotion only after all other budget items are covered.Objective and Task BudgetingObjective and task budgeting involves allocating funds topromotion whereby the company:(1) determines its promotion objectives; (2) outlines the tasks to accomplish these objectives; and(3) determines the promotion cost of performing these tasks.Direct OrdersDirect orders is the result of direct marketing offers thatcontain all the information necessary for a prospective buyer to make a decision to purchase and complete the transaction.Lead GenerationLead generation is the result ofa direct marketing offer designed to generate interest in a productor service and a request for additional information.Traffic GenerationTraffic generation is theoutcome of a direct marketing offer designed to motivate people to visit a business.