Objectives of IMC & Budgeting

The objectives of Integrated Marketing Communication ( IMC) are largely derived from marketing plan of the company. But IMC has a narrow approach as scope is only limited to communication. Some of the characteristic of marketing which get incorporated into IMC are :

• The marketing segment firm wants to target and the target audience
• The product and its main features, advantages, benefits  uses and application  
• Positioning of the brand and specific behavioral responses sought

Check how clearly 3 dimensions of IMC have been highlighted in the following video

Before setting objectives effect of advertising on consumers needs to be understood . It is explained by the following table:

Effect of Advertising on Consumer

IMC is just one factor that drives sale of product.The effectiveness of IMC increases if company excels in other parameters than the competition. Even if consumers are made aware of the product , only a small fraction of the target audience convert into consumers. The communication effect pyramid discussed below provides an illustration of it

Communication Effect Pyramid

An Approach to Objective Setting

 DAGMAR( Defining Advertisement for Measured Advertisement Result)

Characteristic of Objectives

• Concrete, Measurable Task
• Target Audience
• Benchmark & Degree of change sought
• Specified Time period

DAGMAR approach has come under criticism for its inability to incorporate sales objective,practicality & cost, lack of focus on creativity and  response hierarchy.

Zero-based Communications Planning

Another approach for setting the objectives is zero-based communications planning, which involves determining what tasks need to be done and which marketing communications functions should be used

and to what extent.This approach focuses on the task to be done and searches for the best ideas and media to accomplish it. Therefore an effective IMC program should lead with the marketing communications

function that most effectively addresses the company’s main problem or opportunity and should use a promotional mix that draws on the strengths of whichever communications functions relate best to the particular situation. The promotional planner should determine what role various sales promotion techniques, publicity and public relations, direct marketing, and personal selling will play in the overall marketing program and how they will interact with advertising as well as with one another. The communication strategy to be used depends upon expected method of response of customers

The approach also takes into account the response of the customer to any campaign. The 2 most common customer responses are as follows

Along with customer responses following factors need to be taken into account in deciding the budgeting

General Approaches used for budgeting

Formulating Integrated Marketing Communication on the bases of Market Segmentation

It is not possible to develop marketing strategies for every consumer as all of them have different needs and requirements. Thus, the marketers attempt to identify broad classes of buyers who have the same needs and will respond similarly to marketing actions. This ensures that the communication is effectively received by the targeted audience.

The segmentation process involves five distinct steps:

1. Finding ways to group consumers according to their needs.

2. Finding ways to group the marketing actions—usually the products offered— available to the organization.

3. Developing a market-product grid to relate the market segments to the firm’s products or actions.

4. Selecting the target segments toward which the firm directs its marketing actions.

5. Taking marketing actions to reach target segments.

Some of the bases of market segmentation are:

Geographic Segmentation

In the geographic segmentation approach, markets are divided into different geographic units. These units may include nations, states, counties, or even neighborhoods. Consumers often have different buying habits depending on where they reside.

Demographic Segmentation

Dividing the market on the basis of demographic variables such as age, sex, family size, education, income, and social class is called demographic segmentation. Although market segmentation on the basis of demographics may seem obvious, companies sometimes discover that they need to focus more attention on a specific demographic group. While demographics may still be the most common method of segmenting markets, it is important to recognize that other factors may be the underlying basis for homogeneity and/or consumer behavior. The astute marketer will identify additional bases for segmenting and will recognize the limitations of demographics.

Psychographic Segmentation

Dividing the market on the basis of personality and/or lifestyles is referred to as psychographic segmentation. The determination of lifestyles is usually based on an analysis of the activities, interests,and opinions of consumers. These lifestyles are then correlated with the consumers’ product, brand, and/or media usage. For many products and/or services, lifestyles may be the best discriminator between use and nonuse, accounting for differences in food, clothing, and car selections, among numerous other consumer behaviors.

Behavioristic Segmentation

Dividing consumers into groups according to their usage, loyalties, or buying responses to a product is behavioristic segmentation. For example, product or brand usage, degree of use (heavy versus light), and/or brand loyalty are combined with demographic and/or psychographic criteria to develop profiles of market segments. In the case of usage, the marketer assumes that nonpurchasers of a brand or product who have the same characteristics as purchasers hold greater potential for adoption than nonusers with different characteristics. A profile (demographic or psychographic) of the user is developed, which serves as the basis for promotional strategies designed to attract new users.

Benefit Segmentation

In purchasing products, consumers are generally trying to satisfy specific needs and/or wants. They are looking for products that provide specific benefits to satisfy these needs. The grouping of consumers on the basis of attributes sought in a product is known as benefit segmentation and is widely used.

The process of segmentation:

The segmentation process develops over time and is an integral part of the situation analysis. It is in this stage that marketers attempt to determine as much as they can about the market: What needs are not being fulfilled? What benefits are being sought? What characteristics distinguish among the various groups seeking these products and services? A number of alternative segmentation strategies may be used. Each time a specific segment is identified, additional information is gathered to help the marketer understand this group. For example, once a specific segment is identified on the basis of benefits sought, the marketer will examine lifestyle characteristics and demographics to help characterize this group and to further its understanding of this market. 

Meet the Bloggers

We are a group of second year participants at IIM Shillong. The blog has been prepared for IMC course requirments under the guidance of Prof. S.M. Dhume.

Below presented are introduction videos of contributors to the blog.

Introduction Video  - Akhil Tandon 

Introduction Video  - Apoorv Vaidya

Introduction Video  - Deepika Sinha

Introduction Video - Manan Jain

Introduction Video - Rishi Gupta

Marketing Strategy and the IMC

An integrated marketing communications programs is essential for the success of any strategic plan and any marketing campaign. All the elements of the marketing mix constitute the marketing plan of a company, and must be consistent in a strategic plan that results in an integrated marketing communications program. Following is a framework for analyzing how promotion fits into an organization’s marketing strategy and programs.

This model consists of four major elements:

1.     The organization’s marketing strategy and analysis

2.     The target marketing process

3.     The marketing planning program development (which includes the promotional mix)

4.     The target market

As per the model, the marketing process starts with the development of a marketing strategy and analysis. Here in, the company decides upon the product or service it will be offering along with the markets where it will be offered. The company then needs to chalk out a comprehensive strategy to decide upon the constituting elements of the marketing mix so as to reach out to the target customers effectively. It is to be noted that a company’s promotion program is not only directed to end consumer but also to the different channel partners in the supply chain of the product, as they are the ones responsible for delivering the products to the end consumer. These channel or “trade” members must be convinced about the demand for the company’s products, for them to carry out the promotional activities effectively. Promotions play an important role in the marketing program for building and maintaining demand not only among final consumers but among the trade as well.

As Figure shows, the development of a marketing program requires an in-depth analysis of the market. This is necessary to gauge the needs and requirements of the end customers and thus to deliver the products which satisfies that, and also to communicate the values and benefits of such product offerings. This analysis is based upon extensive use of marketing research, which serves as an input into the planning process. This input, in turn, provides the basis for the development of marketing strategies constituting of four P’s viz. product, place price and promotion. Each of these steps requires a detailed analysis, since this plan serves as

the road map for achieving marketing goals. It is only after the completion of this detailed market analysis and the drafting of the objectives that each element in the marketing mix can contribute to the comprehensive integrated marketing program. The integrated marketing communication plan is thus designed in a way which clearly communicates these aspects of the marketing mix to the consumer. And it is to say beyond any doubt, that the promotional program element must be combined with all other program elements in a way which maximizes the impact.

For instance, the following advertisement of Lakme exhibits the two aspects of the marketing mix, product and price. The advertisement describes the features of the product and also the price which has been kept at 150 Rs.

The following advertisement of Apple tells about the place element of the marketing mix by providing a link which displays the list of all the apple stores in India.

The following advertisement of Lakme tells about a promotional exchange offer for Lipsticks.

Celeb VS Non Celeb Marketing

Is Celebrity Endorsement Always the Best Method for Promoting a Brand?

Companies in many cases, prefer not to use a celebrity, but instead go ahead with a spokesperson which has been tailor made for the product by the company. The following are the advantage of such a strategy

• Control: Companies control the created spokesperson as it has been built in conformity with the brand and target audience, and hence can be ensured with a consistent image. 

• Single utilization of created endorsers: Such spokespersons are exclusive for a brand and hence avoiding any brand conflict.

• Focus more on brand and its features: In Non-Celebrity advertisements the main focus is on the brand and its characteristics while in celebrity the focus sometimes shifts entirely to the celebrity’s features .

 CELEBRITIES - TO USE OR NOT TO USE

SITUATION 1

Cadbury has always come up with sweet, emotional, clutter breaking commercials. Who can forget the lady dancing on the cricket pitch to celebrate her boyfriend's century. But when the company was hit with the worm controversy it had to rope in the national icon Amitabh Bachchan. He embodied the values of Cadbury as a brand and connected with all of India - mothers, teenagers, children, media persons and trader partners. This reinstated customer faith in Cadbury and sales have now touched pre-worm crisis days.

SITUATION 2: 

Asian Paints will always be remembered for its 'Mera wallah cream' campaign and more recently the 'Wah Sunil babu' campaign. There have been very forgettable celebrity endorsements from Akshaye Khanna and Saif Ali Khan in the past (probably people were not able to visualize stars painting their own walls). This is a case of a company whose non-celebrity commercials have done way better than their celebrity campaigns in terms of recall and message delivery.

Pyschographic Segmentation Strategy - VALs

Pyschographics emerge from patterns of responses that reveal a person's activities, interests and opinions (AIO). AIO measures can be combined with demographic nformation to provide marketers with a more complete understanding of the market to be segmented.

SRI Consulting Business Intelligence provides a popular classification of U.S. lifestyles using psychographic segmentation. The VALS typology categorizes U.S. respondents into 8 different groups based on resources and the extent to which they are action oriented. The VALs typlology includes the following segments:

• Innovators - Successful, sophisticated and receptive to new technologies. Their purchases reflect cultivated tastes for upscale products.
• Thinkers - Educated, conservative, practical consumers who value knowledge and responsibility. They look for durability, functionality and value.
• Achievers - Goal orientedor, conservative consumers committed to career and family. They favor established prestige products that demonstrates success to peers.
• Experiencers - Young, enthusiastic and impulsive consumers who seek variety and excitement and spend substantially on fashion, entertainment and socializing.
• Believers - Conservative, conventional consumers who focus on tradition, family, religion and community. They prefer established brands.
• Strikers - Trendy fun loving consumers who are concerned about others' opinions and approval.They demonstrate to peers their ability to buy.
• Makers - Self sufficient consumers to have the skill and energy to carry out projects, respect authority, and are unimpressed by material possessions
• Survivors - Concerned with safety and security, focus on meeting needs rather than fulfilling desires. They are brand loyal and purchase discounted products

The Ad for iPhone appeals to the Innovators segment 

The Ad for Fedex focuses on the reliability and superior service which can attract the Thinkers

 segment

 

Rolex advertisement that is suited for Achievers segment

Woodland ad for experiencers

ING VYASA LIC Ad for Believers

VALs Strategt for Thinkers

Selected Type:  Thinkers Product – Tablet

      Who should you target?

a.      Typical Customer Profile

                                                              i.      Motivated by ideals

                                                            ii.      Mature and satisfied

                                                          iii.      Reflective, Look for knowledge and responsibility

                                                          iv.      Well educated, actively seek out information

                                                            v.      Knowledgeable about national and international events

                                                          vi.      Try to broaden their knowledge

                                                        vii.      Alert to opportunities

                                                      viii.      Conservative and Practical

                                                           ix.      Look for durability, functionality and value in the produ

Through what channels you can reach them

a.      PR activities – articles in magazines

b.      Sales promotions – live demo, Product Sampling

c.       In store promotions

d.      Websites – Looks for authentic information

e.      Referrals

f.        Customer review websites

g.      Related product magazines

h.      Catalog marketing

3     What should you offer him?

a.      Highlight the cognitive benefits

                                                              i.      Value for money

                                                            ii.      Superior product specifications

                                                          iii.      Multi-use benefits ( entertainment, work etc)

                                                          iv.      Warranty and After Sales benefits

                                                            v.      Highlight the tried and tested benefits

b.      Emphasis on Brand Equity

                                                              i.      Through websites

                                                            ii.      Social Media

                                                          iii.      Positive Customer reviews

      How will you sell it to him

a.      Print ads in technology managzines

b.      Product reviews and videos on your websites ( Youtube channel)

c.       Active in Social Media to generate positive brand equity

d.      Sponsored blogs

e.      Listings on product comparison websites

f.        Live product demo – kiosks , Free brochures and catalogs

g.      Technology Fairs

Implementing IMC - How Advertising firms can make your lives easier

As we already know, most of the firms selling a product or a service need to communicate their offerings to the outside world for them to be successful. This activity, however, is not limited to creating communication messages or TVCs but there has to be an all-round plan to tap into various media in trying to establish a connect with the customers. Developing and implementing of this integrated marketing communications program is usually a complex process requiring the efforts of many persons. As marketers, it is important to for us to be able to understand the nature of the industry and the structure and functions of the organizations involved, which help these firms with implementation of their IMC plan.

Here, we will try to examine the various organizations that participate in the IMC process, their roles and responsibilities, and their relationship to one another. We would also discuss how companies organize internally for advertising and promotion. For most companies, advertising is planned and executed by an outside ad agency. In this regard, many large agencies offer a variety of other IMC capabilities, and hence it is critical to take a look at their roles.

Before moving forward, let us first take an overview of the entire system and identify some of the players involved.

Here, Advertisers or the clients have the product/service to be sold, money to be spent on the marketing efforts as well as final decision making authority regarding the shortlisting and approval of media-message mix. Clients are also critical in the actual implementation of the marketing program, leveraging on their existing employee/dealer/supplier base. In terms of structure, while there are many inputs which are received for any communication creation, generally the overall responsibility lies with either
a) The advertising department which works under a CMO or
b) Brand Manager of the respective brand (de-centralized)

An advertising agency, is an outside firm that specializes in the creation, production, and/or placement of the communications message and that may provide other services to facilitate the marketing and promotions process. Many clients enlist multiple agencies rather than relying on one, particularly when they market a number of products.
While, the Brand Manager is often the stakeholder from the client firm who interacts with the Ad Agencies in de-centralized system, in the case of centralized system of advertising management, as outlined above, the functions are performed by an advertising manager with a team. They are as follows -
i) Planning and Budgeting (including allocations to each brand)
ii) Administration and Execution
iii) Coordination with other departments as well as other agencies
The de-centralized system works better in terms of focused attention to each brand, but also suffers from the lack of experience of brand managers as well as internal competition.
Another option to handle this is maintaining an in-house agency which will handle all the communication related aspects for that particular organization. The pros and cons of each of the options is evaluated below -

In terms of specialized advertising agencies, there are typically 4 roles that are present in the firm, viz.
1) Account Planning Team
2) Creative Team
3) Client Management Team
4) Media Management Team
Below is a brief description of their roles -

Account Planning - Account Planners form a very essential link between the target customers of the product or services and the creative team within the ad agency. They also co-ordinate with the Client Management team to better understand specific client needs. Account Planners usually connect directly with the end consumers through FGDs or in-depth interviews and generate important customer "insights" which can be leveraged upon in the content creation. Essentially this is similar to providing directions to the creative team for actual ad design.

Creative Team - This team has two sub-parts in the form of (a) Copywriters and (b) Designers. The copywriters are responsible for creating the text content or the exact dialogues to be used in the communication whereas the designers are responsible for determining all the other aspects including placements and typography, background colors etc. Both these sub-teams design the content in accordance with the requirements outlined by account planners

Client Management Team - Client management team performs the overall co-ordination between the clients and various other stakeholders in an ad agency. They obtain feedback from the clients on all deliverables and also participate in brainstorming sessions

Media Management Team - The role of the media management team is more of an operational one and starts after the communication is created. This team is responsible for identifying the exact TV Slots, Channel selection, location selection for OOH advertising; in a manner that will create the maximum impact.

After having looked at the structure of client organizations as well as ad agencies, let us now quickly take a look at how do advertisers identify a particular agency to manage their communication program.

Choosing an Ad Agency :
1) Goal Setting - Identification and prioritization of corporate goals
2) Defining the selection criteria - An objective criteria should be chosen and announced beforehand to avoid any favoritism. The criteria should be well rounded to consider all the relevant parameters such as agency size, expertise, media purchasing capabilities, creative reputation, personal chemistry etc.
3) Initial screening of agencies
4) Reference requests to the shortlisted agencies and analyzing important parameters such as client retention rate
5) Creative Pitch - Creative pitch is very costly and time consuming for an agency and hence they need to choose their targets carefully. A creative pitch generally involves the following -
(a) Selling points of the ad agency
(b) Demonstration of the understanding of the issues related to the client firm as well as the industry
(c) Methodology of analysis of key components and client queries
(d) Possible solution approaches and a preliminary communication sample for each of these approaches
6) Final Agency Selection

Lastly, the successful execution of any IMC plan also depends on the resource commitments from both the advertisers' and ad agencies' side.

Successful Integrated Marketing Campaign : Castrol Australia

The biggest business of Castrol is supply of lubricants to franchised and independent organised mechanical workshops. Castrol Australia inferred from market survey that workshop owners usually decide the choice of the lubricant as automobile owner relied on their advice. The workshop owners in unorganized sector had preference for lower cost lubricants where they enjoyed higher margins. To increase awareness of the draw attention of Automobile owner and pull more customers to large workshop chains, Castrol Australia devised a pull through marketing campaigns, benefiting both Castrol and workshops. It involved providing prizes to the users of the Castrol Lubricants along with sponsoring city wide bike and car racing competition.

The Engagement Tools

1) Poster
Poster as an idea was not so revolutionary but were practical. They were designed to create awareness of the campaign/prizes on offer.Posters were made flexible enough to be placed almost anywhere suitable and explained the prize on offer, how to qualify and how to register.

2) Counter Cards 

They were used to reinforce the poster designed to be clearly visible at time of vehicle drop off and service payment.

3) Stickers
The smallest item but the most powerful - an invoice sticker reinforcing the campaign even after the customer has left the workshop. This sticker is received only if the customer purchases the premium product and provides registration instructions. More than 1 million of these invoice stickers (on rolls of quantity 250 each) were produced and distributed nationally.

4) Online Tools
A web-based customer registration form. Customer enters their details and receives an email confirmation of their successful registration.

5) Mobile Application
A mobile friendly version of item 4.

6) SMS Service
The ability to enter via SMS via a dedicated number set-up specifically for this campaign. Customer also receives reply sms after successful registration via SMS.

7) Communication TipsCustomer communications tips provided to workshop via simple one-pager.

In summary, customer enters workshop, is made aware of the campaign via the poster and/or counter card, workshop representative explains the promotion briefly, on purchasing the premium product customer receives an invoice sticker that gives them three options to register for the prize (via PC, Smart Phone or SMS).

All registrations are logged in a single custom created database that records customer details, time of entry and method of entry. At the end of the campaign, Approved Electronic Random draw software was used to draw the winner of the promotion.

The Outcome
The results to date of the campaign have been phenomenal. Though campaign is designed to be simple but was successfully able to make consumers aware of the of Castrol lubricants and enticed repeat purchase.

Source : Brand Republic

Demystifying Promotional Mix

Promotional Mix


The basic tools used to accomplish an organization’s marketing and communication objectives are often referred to  as the promotional mix

Advertising - Advertising is defined as any paid form of non-personal

communication about an organization,product, service, or idea by an identified sponsor.The paid aspect of this definition reflects the fact that the space or time for an advertising message generally must be bought.

Direct Marketing - In direct marketing, organizations communicate directly with target customers to generate a response and/or a transaction.Direct marketing is much more than direct mail and mailorder catalogs. It involves a variety of activities, including database management, direct selling, telemarketing, and direct response ads through direct mail, the Internet, and various broadcast and print media.

Interactive/Internet Marketing - Interactive media allow for a back-and-forth flow of information whereby users can participate in and modify the form and content of the information they receive in real time.The Internet is a medium that can be used to execute all the elements of the promotional mix. In addition to advertising on the Web, marketers offer sales promotion incentives such as coupons, contests, and sweepstakes online, and they use the Internet to conduct direct marketing, personal selling, and public relations activities more effectively and efficiently.

Sales Promotion – It is generally defined as those marketing activities that provide extra value or incentives to the sales force, the distributors, or the ultimate consumer and can stimulate immediate sales. 

Consumer-oriented sales promotion is targeted to the ultimate user of a product or service and includes couponing, sampling, premiums, rebates, contests, sweepstakes, and various point-of-purchase materials.Trade-oriented sales promotion is targeted toward marketing intermediaries such as wholesalers, distributors, and retailers. Promotional and merchandising allowances, price deals, sales contests, and trade shows are some of the promotional tools used to encourage the trade to stock and promote a company’s products.

Publicity - Publicity refers to nonpersonal communications regarding an organization, product, service, or idea not directly paid for or run under identified sponsorship. It usually comes in the form of a news story, editorial, or announcement about an organization and/or its products and services. Like advertising, publicity involves nonpersonal communication to a mass audience, but unlike advertising, publicity is not directly paid for by the company. Publicity is not always under the control of an organization and is sometimes unfavorable. Negative stories about a company and/or its products can be very damaging. 

Public Relations - It is important to recognize the distinction between publicity and public relations. When an organization systematically plans and distributes information in an attempt to control and manage its image and the nature of the publicity it receives, it is really engaging in a function known as public relations. Public relations is defined as “the management function which evaluates public attitudes, identifies the policies and procedures of an individual or organization with the public interest, and executes a program of action to earn public understanding and acceptance.”

Personal Selling - The final element of an organization’s promotional mix is personal selling, a form of person-to-person communication in which a seller attempts to assist and/or persuade prospective buyers to purchase the company’s product or service or to act on an idea. Unlike advertising, personal selling involves direct contact between buyer and seller, either face-to-face or through some form of telecommunications such as telephone sales.

Comparing Different Marketing Levers

Segmentation strategies for promotion

In planning the promotional effort, managers consider whether the target segment is substantial enough to support individualized strategies. More specifically, they consider whether this group is accessible. Can it be reached with a communications program? It is not possible to develop marketing strategies for every consumer. Rather, the marketer attempts to identify broad classes of buyers who have the same needs and will respond similarly to marketing actions.


The segmentation process involves five distinct steps:
1. Finding ways to group consumers according to their needs.
2. Finding ways to group the marketing actions—usually the products offered— available to the organization.
3. Developing a market-product grid to relate the market segments to the firm’s products or actions.
4. Selecting the target segments toward which the firm directs its marketing actions.
5. Taking marketing actions to reach target segments.

Some Examples of Promotion based on target markets

Liberty has transformed to target urban youth ... shown in the ad below



Time has created a separate magazine for Kids - Age based segmentation



Lifestyle based Segmentation


Occasion based Advertisements

Different occasions and usage provides marketeers to create new usage points and increased consumption. Presented below is the latest Dairy Milk ad for Deepawali.

The list can go on and on. The bottom line is to understand the relevance of segmentation and its effective incorporation in creating promotional strategies.