Chapter 18 The Marketing

Communications Program

Copyright © 2001 by McGraw-Hill Ryerson Limited

Sommers Sommers Barnes BarnesNinth Canadian EditionNinth Canadian Edition

Presentation byPresentation by

Karen A. BlotnickyKaren A. Blotnicky

Mount Saint Vincent University, Halifax, NSMount Saint Vincent University, Halifax, NS

Copyright © 2001 McGraw-Hill Ryerson Limited18 - 2

Chapter GoalsTo gain an understanding of:• The role of marketing communications• Different forms of marketing communications• The concept of integrated marketing

communications• The communication process• Designing and budgeting for the marketing

communications mix• Considerations in developing a marketing

communications campaign• Regulation of marketing communications

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Purposes of Marketing Communications• not only informs, but is also used to

differentiate the seller’s products/services• may also be effective in affecting the

price elasticity of demand (nonprice competition)

• the marketing communications strategy of a firm must be coordinated and linked with concepts such as target segments, positioning, differentiation, and image

• requires a closely coordinated approach

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Marketing Communications

• Informs, persuades and reminds• Is part of the marketing mix• Includes all the means by which a

company communicates directly with potential customers.

• Attempts to influence feelings, beliefs, or behaviour.

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Marketing Communication Methods• Personal selling: The direct presentation

of a product to a prospective customer by a representative of the selling organization.

• Advertising: A paid, impersonal mass communication with a clearly-identified sponsor.

• Sales promotion: Demand-stimulating activity designed to supplement advertising and facilitate personal selling.

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More Methods

• Public relations: A planned communication effort by an organization to contribute to generally favourable attitudes and opinions toward an organization and its products.

• Publicity: A special form of public relations that involves news stories about an organization or its products.

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Integrated Marketing Communications

• A strategic business process used to plan, develop, execute, evaluate coordinated communication within an organizations publics, requiring:• Awareness of audience’s media habits and

preferences• Understanding of audience’s knowledge and

beliefs about the product• Use of coordinated media blend linked to a

specific objective• Key is a single, coordinated message and

image thrust

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Basic Communication Elements• A message• A source of the message• A communication channel• A receiverCommunication process components:

• Encoding• Decoding

• Response• Feedback• Noise

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The Communications Process• communications requires a channel, with a

sender and a receiver, to handle the message

• a message is first encoded by the sender• the communications channel is then used to

deliver the message to the sender• the sender decodes the message, based on

his or her frame of reference and experience• may be a need for a response and feedback• the process can be interrupted by noise

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MESSAGE CHANNEL

Select the mediaor other vehicle

to carry the message

MESSAGE CHANNEL

Select the mediaor other vehicle

to carry the messageDECODING

THE MESSAGEReceiver compares

message toframe of reference

DECODINGTHE MESSAGE

Receiver comparesmessage to

frame of reference

MESSAGE AS RECEIVED

Knowledge, beliefs,or feelings of

receiver changed

MESSAGE AS RECEIVED

Knowledge, beliefs,or feelings of

receiver changed

RESPONSERanges from simple

awareness topurchase

RESPONSERanges from simple

awareness topurchase

FEEDBACKImpact measured

using research, sales,or another measure

FEEDBACKImpact measured

using research, sales,or another measure

ENCODING THEMESSAGE

Create an ad,display, or sales

presentation

ENCODING THEMESSAGE

Create an ad,display, or sales

presentation

MESSAGE ASINTENDED

A promotional idea inmarketer’s mind

MESSAGE ASINTENDED

A promotional idea inmarketer’s mind

NOISECompeting ads,

other distractions

The Process

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Inside the Communications Process• The act of encoding allows that

messages can take many forms.• The methods of transmitting a message

are limited only by the imagination and creativity of the sender.

• How the message is decoded depends on its form and the capability and interest of the recipient.

• Without measurable objectives, the effectiveness of a message cannot be evaluated.

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Considerations in Designing Marketing Communications Mix• Target market

• Readiness to buy, knowledge, liking, preference, conviction (belief)

• Purchase• Geographic scope• Type — consumer or middleman• Concentration

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• Nature of the product• Unit value • Degree of customization • Presale and postsale service

• Stage of the product life cycle• Amount of money available for

promotion

More Considerations

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Push or Pull Strategy

• a push strategy directs communication efforts at channel members; a pull strategy directs promotion at the end consumer

• many products, such as business products, are promoted with a push strategy, involving personal selling and use of trade promotions

• most consumer products would rely more heavily on a pull strategy where promotion is directed at the consumer to stimulate demand

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Choosing a Push or Pull Strategy• A push strategy is directing the

communication primarily at the middlemen that are the next link forward in the producer’s distribution channel.

• A pull strategy has the communication directed at the end users — primarily consumers.

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ProducerProducer WholesalerWholesaler RetailerRetailer ConsumerConsumer

ProducerProducer WholesalerWholesaler RetailerRetailer ConsumerConsumer

PUSH STRATEGY

PULL STRATEGY

Product flow Communication effort

An Illustration

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Determining the Communications Budget• Percentage of Sales:

• Based on past or projected sales, e.g. 2%.• $X per unit is variation for big-ticket items.• Simple, but implies it’s a result of sales.

• All Available Funds:• New business which needs to build sales

and share in early years can use this.• Can make sense if more marketing

communications leads directly to more sales.

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More Budgeting Methods• Follow the Competition:

• Match what your competitors spend.• Can use industry averages.• Benchmark against one key competitor.• But does it fit with your strategies?

• Task or Objective:• Best approach: What do you want to

achieve?• Identify tasks/objectives, then cost them out.• Sometimes called buildup method.

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Regulation in Marketing CommunicationsFederal Role:• Canadian Radio-television and

Telecommunications Commission (CRTC)• It looks at broadcast advertising.

• Health Protection Branch• Deal with drugs, cosmetics, etc.

communications• Some drugs cannot be advertised due to

worries about self-diagnosis.• Industry Canada

• Oversees various acts, including Competition Act.

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More Regulations• Provincial Role:

• Various boards control liquor, films, human rights, securities, etc.

• Recently, special focus on misleading advertising problems.

• Private Organizations:• Many media refuse to accept certain

ads.• Industry codes for Advertising

Standards, Advertising to Children, etc.