McGraw-Hill/Irwin Copyright © 2009 by The McGraw-Hill Companies, Inc All Rights THE COMMUNICATION PROCESS • Integrated Marketing Communications (IMC) – concept of designing marketing communications programs that coordinate all promotional activities – advertising, personal selling, sales promotion, public relations, and direct marketing – to provide a consistent message across all audiences Slide 18-6 THE COMMUNICATION PROCESS • Communication – process of conveying a message to others Source – company or person who has information to convey Message – information sent a source to a receiver in the communication process Channel of communication – means of conveying the message (e.g., salesperson, advertising media, or public relations tools) Slide 18-6 THE COMMUNICATION PROCESS • Communication – process of conveying a message to others Receivers – consumers who read, hear, or see the message sent by a source Encoding – process of having sender transform an idea into a set of symbols Decoding – reverse of encoding Slide 18-6 THE COMMUNICATION PROCESS • Feedback Feedback Loop Response – impact message had on receiver’s knowledge, attitudes, or behaviors Feedback – sender’s interpretation of the Response and indicates whether the massage was decoded and understood as intended • Noise – extraneous factors that can work against effective communication by distorting a message or the feedback received Slide 18-10 FIGURE 18-1 The communication process consists of six key elements 18-6 PROMOTION Promotion An effort by marketers to inform and remind people in the target market about products and to persuade them to participate in the exchange 18-7 PROMOTION • Promotional Mix – combination of one or more of the communication tools to: – Inform prospective buyers about the benefits of the product – Persuade them to try it – Remind them later about the benefits they enjoyed using the product Slide 18-6 PROMOTION I Personal Selling (1) II Non-Personal Selling Advertising (2) Sales Promotion (3) Public Relations (4) Slide 18-6 THE PROMOTIONAL ELEMENTS ADVERTISING Paid, non-personal communication through various media by organizations and individuals who are in some way identified in the advertising message Total advertising volume exceeds $231 billion yearly Personal Selling Personal 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 18-42 Public Relations Public 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 18-43 Publicity Publicity is a nonpersonal, indirectly paid presentation of an organization, good, or service 18-44 Sales Promotion Sales promotion is a short-term inducement of value offered to arouse interest in buying a good or service 18-45 Direct Marketing Direct marketing is a promotion alternative that uses direct communication with consumers to generate a response in the form of an order, a request for further information, or a visit to a retail outlet 18-46 Push Strategy A push strategy involves directing the promotional mix to channel members to gain their cooperation in ordering and stocking the product 18-47 Pull Strategy A pull strategy involves directing the promotional mix at ultimate consumers to encourage them to ask the retailer for a product 18-48 Hierarchy of Effects The 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 18-49 Percentage of Sales Budgeting Percentage of sales budgeting involves allocating funds to promotion as a percentage of past or anticipated sales, in terms of either dollars or units sold 18-50 Competitive Parity Budgeting Competitive parity budgeting involves allocating funds to promotion by matching the competitor’s absolute level of spending or the proportion per point of market share Also called matching competitors or share of market 18-51 All-You-Can-Afford Budgeting All-you-can-afford budgeting involves allocating funds to promotion only after all other budget items are covered 18-52 Objective and Task Budgeting Objective and task budgeting involves allocating funds to promotion 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 18-53 Direct Orders Direct orders is the result of direct marketing offers that contain all the information necessary for a prospective buyer to make a decision to purchase and complete the transaction 18-54 Lead Generation Lead generation is the result of a direct marketing offer designed to generate interest in a product or service and a request for additional information 18-55 Traffic Generation Traffic generation is the outcome of a direct marketing offer designed to motivate people to visit a business 18-56 ... enjoyed by using the product 18-28 Integrated Marketing Communications (IMC) Integrated marketing communications (IMC) is the concept of designing marketing communications programs that coordinate... includes planning, implementation, and evaluation 18-25 DIRECT MARKETING LO5 The Growth of Direct Marketing The Value of Direct Marketing • Direct Orders • Lead Generation • Traffic Generation... or personal selling • Direct Marketing Slide 18-18 LO2 THE PROMOTIONAL ELEMENTS SALES PROMOTION AND DIRECT MARKETING Sales Promotion • Advantages • Disadvantages Direct Marketing • Advantages