Marketing communications Essay - Part 3
1 - Marketing communications Essay introduction. Introduction
The role of marketing communication in modern business practices has been identified as a key factor in survival in modern day business. As part of the search for business effectiveness the entire process of marketing communication is being approached in a comprehensive and unified manner where by all activities of business communication functions in unison. This approach is called Integrated Marketing Communication. This is a relatively new concept in management. It is engineered to harness all aspects of marketing communication such as advertising, promotion of sales, public relation, and direct marketing in a highly focused manner eschewing the former tendency of these departments to function in isolation. Competitiveness in business the world over is so acute that survival is possible for only those organizations, which are ready to employ every possible means to increase profit by reducing cost in production, while remaining uncompromising in quality and aggressive in marketing. The account of the phenomenon of Integrated Marketing Communication by Aaker, Batra and Myers (1992) constitutes a fair working explanation of the phenomenon:
“advertising and sales promotions operate together in their impact on the consumer. When designed and run in tandem, they yield power synergies that magnify their individual effects.”
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The ambiguity centered on the definition of Integrated Marketing Communication has created complexity in assessing the operational efficiency of the process. There are many levels of integration, which produces problems collectively as well as individually. The ideal execution of Integrated Marketing Communication calls for the sharing of the entire organization.
As your own marketing director of Business school, you have to make decisions about:
“The product or service, Pricing, Customer service levels, Distribution, Advertising and Selling.”
As director, you need to bring your potential customers from being unaware of
you to actually buying. To achieve that, you need to be able to communicate:
“What you do (who, what, where, how); unique selling proposition; features and
Benefits & your marketing message (sales and image).”
2. MARKET RESEARCH
The better your market research, the smarter your decisions, and the more profitable you will be. Market research will: help you to determine whether the idea is viable; help you to identify the customers within your target markets; help you to analyze the market and the competition; help you to analyze your own capabilities
Analysis of the competition
This involves answering these questions:
(1) Do you know who your direct competitors are? And Is there too much competition in the market?
(2) Do you know who your indirect competitors (those competing for the same money pool) are?
(3) Will your entry into the market be a threat to your competitors?
(4) What are their capabilities and what are their future prospects?
2.1. PRICING STRATEGIES
A related but separate area of market research is pricing. Every product or service you intend to offer must have a price set for it. In determining your pricing policy, you need to calculate you’re: Production costs; Profit margins; Overheads; Promotional and advertising expenses & Delivery costs are included. There are several types of pricing strategy: (Business eye)
Cost-based pricing – You arrive at the price by adding the costs of production (material, labour, fixed and variable overheads) and business operations to a profit margin. This is a popular strategy in manufacturing
Mark-up pricing – You add a pre-set percentage to the cost of goods from your supplier + distribution costs. This is a popular strategy in retail
Demand-based pricing – You determine price according to what customers are willing to pay
Follow the market pricing – You set your price by following the usual or average price of your competitors
Penetration/loss leader pricing – You offer a low price or below cost price in order to attract customers away from the competition. Note that the pricesof certain items such as milk and bread are subject to special regulations regarding minimum price
Price skimming – You go in with an initial high price, and reduce the price as the market becomes saturated or as the novelty value wears off. Look at how computer prices plummet just a few months after they are launched
Time-based pricing – This is common practice for service businesses, whereby you agree a fee per hour and calculate the number of hours the job takes or should take
2.2. Indirect marketing channel
Independent representatives & agents Reps and agents are independent contractors who find outlets for your products. The advantages of using a rep/agent is mainly the Cost advantages – they only earn commission when they sell on your behalf
2.3. DISTRIBUTION CHANNELS
Once you have decided what kind of business you are setting up, you need to choose a combination of distribution channels for delivering your product or service to your customers. (Business eye)
2.4 Direct marketing channels
If you are a service business or a small manufacturer, you will probably use a Direct Marketing Channel, whereby you and your salaried staff sell directly to your customers. By customer, we mean anyone who buys directly from you, whether it’s a consumer, another business, a retailer or a wholesaler:
2.5. SELLING & DISTRIBUTION
You never stop selling. The trick is to stay true to your own style. Selling ultimately is about clinching the deal. Keep trying and you will. Always consider: Direct/indirect distribution channels to deliver your product or service & Export – pros and cons. You should remember that once you have acquired customers it makes good business sense to keep them. Because services are intangible, you need to put even more emphasis on marketing and added value.
3. LITERATURE REVIEW
3.1 Dimensions of Integrated Marketing Communication
3.1.1. Conceptualization ion of the idea
The purpose of marketing communication is to influence the thinking process of the recipient the communication about a brand, a project, a service etc. This called the conceptualization ion of the idea.
3.1.2. Relationship building
The next step is the relationship building. The recipient of the communication and the brand should establish emotional connection. This activity takes place in the subliminal level. Marketing communication should establish a relationship of trust with the entire clientele, which is comprised of the every day functional user of a product in the wider society as well as the user of a product in a chosen niche of the community. This trust of the recipient would be expressed in sales enquiry or attempt switch to the new brand. (Altman, 1987) This is the activation of behavioral change in visible forms. Once the activation is discernable, it is to be supported by immediate help by the quick operation of the service sector of the brand in the form of further information by some form of contact.
3.1.3. Product experience
Relationship building is followed by a product experience, which makes the initial trust with the communicator and the recipient of communication a concrete reality. All the above dimensions have to be performed in a coordinated manner.
3.2. The Importance of Integrated Marketing Communication
An integrated marketing communications program guarantees that every chance to send a message to a customer functions efficiently and smartly. Many needs of the enterprise like increasing membership, ensuring member retention, or increasing non-dues revenue, entry into an impenetrable market etc is achieved by stretching and straining all the sinews and muscles of the enterprise. This can be also called persuasive communication. Chris Fill has observed the complexities that communication involves. Persuasion can be experiential in of a negotiation process between people. It might need propaganda material typically associated with the government. Sometimes the sender or speaker may be presenting their opinion to a large group of people with no chance for feedback from the crowd (Fill 1995).
Marketing communication can succeed only if the communicator has a clear idea of his task. Based on the target market and target’s need he or she should have a unique selling proposition. Communication should help the target group to see you differently form other competitors. In addition, the sales targets should be planned and achievable levels should ear marked and budgetary provisions and a marketing strategy should be in place to achieve these levels. The message delivered in all places, occasions should be consistent, and reliable quantitative tools should measure results.
3.3. Integrated Marketing communication-Barriers and Gateways
The main problem in implementing integrated marketing communication is elitism at the helm. All organizations run the danger of developing an elite group who have become conservative and might try maintaining statuesque because of the self imposed image of superiority. These may be opaque to innovations. They might have become defunct but continue in the organization by the sheer weight of their previous performance. Their ignorance of the new trends and their self assumed superiority could act as a dead weight in the implementation of integrated marketing communication. The organization will have to reorganize the reward systems, as all the departments are the integral part of marketing communication. If the organization does not have performance audit mechanism in place, it may not be able to see the palpable benefits of the implementation of the new system.
The integrated marketing communication can be effectively implemented only if the above barriers are tackled. Having said that, the next step, which is the gateway to its implementation, is the media strategy with integrated promotional mix. The mangers will have to be not only proven team players but also cross-functional and the organization should develop the right evaluation tools to measure the contribution of the different departments and institute reward system to motivate all the players of the team
The terms media plan and media strategy are used to convey the techniques of effective communication delivery to consumers. The recipients of communication are different, they may have different characteristics, and consequently the media needed to reach them will be different. The Integrated Marketing Communication has realized this and uses multiple channels of media like advertising, public relations, events, direct response media etc. The success of this integrated method in entertainment-education (edutainment) as pro-social messages embedded into drama, skits, street plays and road shows coupled with other traditional modes of communication have yielded excellent results in family planning, literacy, nutrition and conservation.
“ Before establishing specific media objectives it is also essential to focus on how the media affect your advertising goals. Although your ultimate marketing goal for most goods is to sell more product (or services or image), unless your audience finds out about the product through the media that you use, that goal is unlikely to be reached (Katz 36).
In this context, it is interesting that the new media is overshadowing the traditional media. Technology has brought about greater access to the new media. The possibility of doing without hardcopies has brought down overheads in the production of various types of magazines now available in the e-format. There is a flood of e-zines and blogs in the net today. Because of the possibility of personal participation from anywhere, these are becoming very popular and studies show that the advertisements in these new media are very effective and their reach is increasing day by day with limited cost.
4. Measurement Approaches
Reach and frequency are the important indicators of performance. However, the reliability of their data is often very doubtful. However, in the absence of any other foolproof yardsticks to measure advertisement effectiveness we still have to depend on them while we are trying to enhance their reliability. The problem is all the more serious when there is a media mix. It is a challenge to the media planner to be able to consider telephony and PR along with broadcast medium, print media and the blogs and e-zines as he does not have a toolkit to gauge the degree of effectiveness between these media. Therefore, the first task is to develop a proper tool that will measure the media effectiveness of types separately and when they are used in combination. The plethora of media available for our selection has put the business of communication with a mine of opportunities. The approach to media based only on number and reach may not be suitable in integrated marketing communication. The insistence on researched data for choosing the media might stifle creativity because the integrated marketing communication has a strong element of creativity in it. The creative choice process …involves weighing the comparative strengths of scientific and mystical approaches as to which will be more effective in swaying a given audience (a target universe, as mass communicators often label it)(Orlik 56). The power of message that hits through all the channels develops so much of synergy and the extent of the synergy may not be measured. The synesthetic synergy, however, explains how simultaneous media usage may reinforce messages to create a response larger than the source of the messages themselves (Pilotta et al). Whether communication is an art or science is still debatable. Even if we accept communication as a science, we will have to concede that it has characteristics of art.
5. Methods of Dissemination in Communication
Perhaps the most effective method of communication is the face-to-face or the interpersonal. It is very human in content and experience and often is recalled as a cherished or terrible experience. Perhaps this was the only tool available to the primitive man. Technology progressively replaced the human factor in communication. However, the audiovisual media has the many features of the primitive with the availability of sight sound and movement and the added advantage of enabling communication to masses and from distances. Studies have underlined the effectiveness of this media in sending persuasive messages. When the visual element is absent the media is called audio media (loud speakers and radio) and the audio element is absent it is called visual media (cartoons pictures, statistical data). Print media made up of newspapers, magazines, handouts etc are other well-known tools for marketing communication. The media can support one another. Print media can highlight what is in the broadcast media and similarly radio can give coverage about what is in the press.
6. Criteria for Selection of Media
One of the conditions for the selection of a particular media is its acceptability to the targeted audience. However there can be constraints of availabity of that media and the capability of harnessing that media in a milieu; the media may not available to the target group. Another factor to be considered in media selection is the timeliness of the production. The adage the early bird catches the worm is nowhere more true than in marketing communication. (Browne, 1998) An immediate opportunity has to be communicated as fast a possible and lag due to production time constraints and dissemination problems might make the message improperly timed. Quantity is important, as certain volume of one medium has to be sufficiently supported by another medium of a certain volume to achieve optimum result. Finally, there is the suitability criterion of language, vocabulary graphics etc used in the communication. (Perse, 2001) A newspaper advertisement will be an exercise in futility for an illiterate target group. Media planning in the competitive business environment is no frivolous task and media managers can leave nothing to chance in this field.
7. Supportive Communication Elements
The style of marketing communication that is followed by many organizations have an integrated approach. In this approach, there are many components. Only if all the components function smoothly the goal can be achieved. Some times these are called supportive communication elements. Marketing communication is no more a matter of advertising in radio, television in the print media. (Harris, 1997) For achieving the best possible communication with the consumers the sender of the message should use a host of tools like advertising, public relations, direct marketing, interactive- internet marketing, sales promotions and personal selling. (Gerbner, 1980)
The focus of integrated communication is not short-term gains. Short-term gains may
be achieved quickly. However now a business enterprise is viewed as a long-term project. More and more entrepreneurs realize that the most valuable asset of an organization is the people. So increasingly, businesses tend to hold on to the view people first. This attitude has a salutary effect on the performance of the company because people contributed their might because they realized that the organization and they are inseparable. The respect to persons comes from an ethical awareness of values and ethics is intrinsically related to any lasting enterprise. In a free market, the most productive staff, the finest suppliers and the cheapest and most flexible sources of finance can do better than to stay with a business that cheats or treats them unfairly. (Chris, 2002)
Various behavioral theories are used to achieve the integration of people with an
organization. Frederick Herzberg and Abraham Maslow have contributed much to our understanding of factors that make people contribute their best. In Herzberg’s view, there are job factors that motivate employees. Marsow identified a rank of human needs that motivate people. In Hersberg’s analysis company policy, supervision, interpersonal relations, working conditions, and salary are hygiene factors rather than motivators. According to the theory, the lack of hygiene factors can generate job dissatisfaction, but their existence does not stimulate or produce satisfaction. He listed five factors in particular that were powerful determiners of job satisfaction. These are achievement, recognition, the work itself, responsibility, and advancement. These are the satisfiers associated with long-term positive factors in job performance while the dissatisfiers had only short-term effects only. The integrated marketing communication gave lot of value to these theories because of the focus on long-term effects. In Maslow’s theory, there is a general pattern of needs identification and satisfaction that people follow in normally the same sequence. He also put forward that a person could not make out or pursue the next higher need in the hierarchy until her or his currently recognized need was significantly or completely satisfied, a concept labeled prepotency. Maslow’s hierarchy of needs is often shown as a pyramid with the survival need at the broad-based bottom and the self-actualization need at the narrow top. Many enterprises have been influenced by these theories and changes brought about in the structure of the organization have yielded excellent results.
Integrated marketing communication has made certain demands in the manner of staffing and training. The traditional functioning of the organization as separate compartments did not call for too much interaction with other departments. Now it is necessary for various departments to rub shoulders with one another. This augments the chance for conflicts: When individuals are required to work together, personality conflicts are magnified. This will lead to disagreements, which can cause strained relationships. Expect that some of your team members will be very disturbed by this (Biech. 5). Therefore at the recruitment stage the personnel should be selected taking into consideration the social qualities. There is a great stress placed on emotional quotient of the staff. The capacity of being a team player is essential in the backdrop of integrated marketing communication. The integrated marketing communication also calls for people who are capable of multi-tasking. In fact, most Universities have tailor made their curriculum to meet this challenge. (Wright, 2002)
The integrated marketing communication has also brought about a paradigm shift
towards the attitude of the company boss. The style of leadership in integrated marketing communication cannot be one of the commander and the commanded. In fact, the functional leadership of the boss, which managed from his/her isolated fortress of the innermost office room, cannot be copied any more. His/her role is one of a team builder and he/she has to see to the emotional content of his/her staff.
In conclusion, the traditional attitude of an organization made up of buildings,
furniture, equipments, products etc will have to be replaced by more of human factors. In the new set up of humanized work environment each will experience identity for himself or herself because of the realization that each ones work contributes to the success of the enterprise.
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