LE MANH HUNG LEO/MKT2010/014201000256

1st ASSIGNMENT
CHAPTER 2: The Role of IMC in the Marketing Process

1.

Discuss the difference between a push and a pull strategy. What kinds of firms would be more likely to employ each strategy? Give examples y Push strategy: is a strategy attract retail customers or consumers, purchase their
products by using the marketing tools directly affect creates demand such as: o Advertising in mass media (newspapers, television, Internet, radio, brochure ...). o Event o Public Relation o Trying to use ! in order to customers but not to sell products, as customer demand increases, more and more need those products or services immediately. Through marketing tools, the objective of the manufacturer or service provider is how to entice impact, attract attention and create the necessary demand, stimulating the desire to have just the product / service that in mind for our customers. And when necessary, customers will turn to the intermediate level (agents, distributors) to buy products or services. Example: the kind of firm uses this strategy when this firm products fast moving consumption goods. While company has many competitor

Pull Strategy: As a strategic focus on "pushing" goods from the manufacturer or service provider to the intermediate level, focused on wholesale distribution, the intermediate or seller. Normally manufacturers have discount sales to dealers through many forms: consignment, 100% payment or payment in installments, overlapping products ... To convince yourself of sales agents, producers production or service is always available a team of professional staff such as sales support, supervision and management of the area ... The staff are issued by companies to provide product knowledge, training sales skills, supervisory skills, management... In summary, the marketing strategy, manufacturers or service providers often use both forms of promotion and promotion consistent with program objectives for each time and industries, each particular product or service.

Example:
To achieve efficiency in marketing, business needs to know the combination of push and pull strategies in marketing. When the degree of certainty about the product demand is not high and the integration of the order does not help cut costs, you should apply the pull strategy.

When you achieve economies of scale by integrating the predicted demand and the degree of certainty about the high demand, enterprises should adopt strategies to push. This is typical of foodstuffs processing group. Push strategy will reduce risk when demand is uncertain. Decorating industry - furniture includes a variety of product color, size, variety and uncertainty in demand is low, transport costs will be higher. Enterprises need to differentiate your product and distribution strategy to reduce transportation costs. By setting the retail store, the customer orders, orders will be sent to the company and produced in accordance with such orders. However, on delivery, in order to achieve economies of scale, these companies do not deliver the product in order but also to integrate other products to the store and the business sector. This is a strategy to push - pull combination. Uncertainty about lower demand, economies of scale tend to be low, short product life cycles; enterprises should set up push-pull combined; "drag" in the production and distribution, "push" the the retail market. The Metro is implementing this strategy with consumer goods manufacturers such as Unilever, Nestle ... together to better control inventories. In a push strategy the communication and selling emphasis targets the channel of distribution members. Thus, programs are designed to persuade the trade to stock, merchandise, and promote manufacturers products. The goal of the strategy is to push the product through the channels by promoting them to the trade. In a pull strategy, the target audience is the end buyer and/or consumer. The goal is to create demand among consumers and have them demand the product from middlemen. Once retailers see the demand, they will request the product from the wholesaler or manufacturer directly. Companies may employ either a push or pull strategy. Proctor & Gamblea perennial leader in advertising to consumerslearned years ago that it must get the products on the shelves to be sold. Thus, the company shifted much of its consumer targeted advertising to the trade to insure that it was stockedthus, pursuing both a pull and push strategy. Others have used a pull strategyfor example, the Philadelphia Magazine ran an advertising campaign urging consumers to visit a newsstand to demand their magazine be carried. Companies pursuing a push strategy tend to rely more on their relationships with the trade, using IMC tools such as advertising, sales promotions, etc. that reach the middlemen. It is not at all uncommon for companies to incent sales employees to push their brands at the retail level. Decisions as to whether to emphasize a push or pull strategy depend on a number of factors including the companys relation with the trade, the promotional budget and demand for the product. Companies with favorable channel relationships often use a promotional push strategy and work closely with channel members to encourage them to stock and promote their products. Firms with limited promotional budgets may not have the funds for advertising and promotion that are required for an effective pull strategy and may find it more feasible to target their efforts to the trade. Products with favorable demand resulting from unique benefits, superior advantages and/or popularity among consumers may use a pull strategy.

2. A number of approaches to segmentation have been cited in the text. Provide examples of companies and/or brands that employ each.

A number of approaches to segmentation have been cited in the text such as: Geographic Segmentation; Demographic segmentation; Psychographic Segmentation; Behavioristic Segmentation; Benefit Segmentation. Marketers can use one of the segmentation variables or combine approaches.  Geographic Segmentation is an approach that marketers use to divide market into different geographic units such as nations, states, regions, area size, density, or even neighborhoods o Example: Honda Vietnam has been doing a research about Vietnamese Geographic to understand Vietnamese market. From this research, this company can understand this market to decide amount of product will be produced.  Demographic Segmentation is an approach that marketers use to divide market on the basis of demographic such as gender, age, family size, education, income, social class. In this approach, company needs to focus more attention on the specific demography group. o For example: Kotex needs focus on customers who are young (teenagers until 40s) and of course, they are female.  Socioeconomic is a part of demographic segmentation, from this approach, firms can identify number of people in this market with their income, occupation, education suit with firm s products. o Example: President University needs to research about income of potential students who are living in rich, podded families with high-level cognition, from that, this firm can implement suitable marketing plan.

 Psychographic Segmentation: Dividing the market on the basis of personality and/or lifestyles. The determination of lifestyles is usually based on an analysis of the activities, interests, and opinions of consumers. These lifestyles are the correlated with the consumers product, brand, and/or media usage. For many products and/or services, lifestyles may be best discrimination between use and nonuse, accounting for differences in food, fashion, among numerous other consumer behaviors. o For Example: beverage manufactures recognize that people live in 21st century are more activity, they decide to manufacture beverage products by using PET, plastic packaging..  Behavioristic Segmentation: diving the market into groups by according to their usage, loyalties, or buying process to a product.. o Some firms really focus on this segmentation approach are retailer. From this approach, retailer can understand consumer behavior and implement right decision. 3. Recently some marketers have noted that it is easier to develop communications programs to Generation X members than Generations Y. Briefly describe the characteristics of Gen X and Gen Y, and whether or not you believe this to be true.

There is some debate as to whether Gen Xers (born between 1965-1978) or Gen Yers (1978 to 1986) is more easily targeted by marketers. Each of these groups has their own identifying characteristics. Generation X consumers are typically characterized as self-confident, yet distrustful of those of previous generations (and of marketing practices).They also tend to be less optimistic than their Gen Y counterparts. They are demanding consumers, less concerned with brand names and image and more concerned with quality. Gen Y consumers love to spend. They process information quickly, are quick to adopt new technologies and are more optimistic about the future. In the eyes of some, they are shameless consumers. Compared to Gen X they are less rooted in social mores, and buy because they like to do so. While marketers may argue that Gen X is hard to relate to and more cynical and skeptical than the Yers, once you have their trust, they will become loyal and remain somaking them an attractive segment. The key is getting their trust. On the other hand, reaching Gen Y is not as hard. They will buy based on wants rather than needs, focus on image and brands, and consume as a way of life. They are easier to reach given a proliferation of mediaparticularly the Internetand a much improved cable selection. They may not stay loyal, but there is always someone behind them with money to spend. And so on the one hand it is brand loyalty versus spontaneous buying on image and appeal. For Gen X all you have to do it get their trustnot an easy task. For Gen Y, all that is required is to have a strong brand, create one, or develop an appealing image. This is not easy either. There are many more issues that might argue for either sides being more easily reached. The one thing that is for sure is that both offer attractive options, with a combined purchasing power in the hundreds of billions of dollars.

CHAPTER 1: An Introduction to Integrated Marketing Communications 1. Discuss how integrated marketing communication differs from traditional advertising and promotions. What some of the reasons more marketers are taking an IMC perspective to their advertising and promotional programs.

Traditional advertising and promotions focus on majorly mass media advertising. This method is too wasteful but not effective in marketing. Integrate marketing communication show fully a marketing plan. From this plan, company evaluates the strategic roles of several communications disciplines such as: media advertising, direct marketing, interactive/internet marketing, sales promotion, publicity/public relations and indicates their effectiveness of each to marketing strategy of company. Some of reasons more marketers are taking an IMC perspective to their advertising and promotional programs.

2. Discuss the changes which are leading to the fragmentation of media markets. How are marketers responding to media fragmentation? Media fragmentation is a trend increasing choice and consumption of a range of media in term of different channels (source: internet) The change which is leading to the fragmentation of media market mostly is Internet or using Internet. Nowadays, internet is increasing very fast, more and more popular. There are a lot of people using internet frequently. Thus advertisement on TV, radio channels are not one kind to approach audience, customer (audiences are divided) Responding to media fragmentation, marketers should know how to combine advertising by using internet as an instrument to communicate and other marketing instruments effectively by indicating, recognizing, and reaching target audiences. 3. Why is it important for those who work in marketing to understand and appreciate all the various integrated marketing communication tools and how they can be used? Understanding and appreciating all the various integrated marketing communication tools is important because:

Marketers have to understand advantages and disadvantages of each marketing communication method; based on that, they can the value of strategically integrating the various communications functions.
In many cases, the communication of the company will target markets and will have to use multiple media. In fact, companies may need to use different messages, as well as various instruments to target objects are perceived in the different steps in the buying process. Integrated marketing communication brings effectively a consistent message and fulfillment. Marketing communications aimed at creating awareness, providing knowledge, create positive impression, a favorable position in the consumer's mind, creating the interest purchase and sale transactions. The marketing manager can find the most optimal way to allocate financial resources to support the product labels, and coordination of all spending to contact points customer receives a consistent message.

How?
Putting ourselves into consumers position while seeking a marketing communication program. When selecting media, see where customers are in the buying process. Then use whatever means may be targeted to the highest goal you desire. (ex: maximizing the impact of mass-media ) Maintaining the expanded customer. While we doing advertising plan, make sure we understand who potential customer is, and what marketing communication they usually use. Ex: by analyzing customer behavior when they click ad-on on a website.

CHATPER 3:

Organizing for Advertising and Promotion: The Role of Ad Agencies and Other Marketing Communications Organizations

1. Identify the various organizations that participate in the integrated marketing communications process and briefly discuss their roles and responsibilities. Organizations which participate in the integrated marketing communications process are: Advertisers or clients are the key participants. It is their product or service that is being offered and that must be marketed. The advertiser is responsible for all marketing aspects, and will ultimately have the final say regarding approval of the proposed promotional programs. It is the advertiser who ultimately pays the bills. The advertising agency is an external organization specializing in the creation, production and placement of the communications messages. They may also provide additional services designed to facilitate the marketing effort. Media organizations provide the advertiser with a channel for their communications. Media may include print, broadcast, outdoor, etc., and media organizations attempt to provide the advertiser with the proper environment for the message. Marketing communication specialist organizations provide services in specific areas of marketing communications. They include direct response agencies, sales promotion agencies, public relations firms and interactive agencies. Collateral services participants are those who provide a wide range of support services including marketing research, package design firms, consultants, photographers, event sponsorship firms, and the like. Their function will vary in accordance with the needs of the promotional program.

2. Discuss the various methods by which advertising agencies are compensated. What factors will determine the type of compensation arrangement a company uses with an agency? Agencies are typically compensated in three ways: through commissions from the media, some type of fee arrangement or percentage charges. The traditional method of compensating agencies has been through media commissions whereby the agency receives a specified commission from the media on any advertising time or space it purchases for the client. There are two basic types of fee arrangements systems. Under the fixed-fee method the agency charges a basic fee for all of its services and credits to the client and credits any media commissions earned. Sometimes agencies are compensated through a fee-commission combination, whereby the media commissions received by the agency are credited against the fee. Another type of fee-based compensation arrangement is the cost-plus system whereby the
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client agrees to pay the agency a fee based on the cost of its work plus some agreed-on profit margin. The type of compensation system a company uses with an agency will depend upon a number of factors including the size of the advertising budget the role of advertising and their reliance on traditional media advertising versus other forms of integrated marketing communications. Most small companies do not have large enough advertising budgets to warrant the use of the traditional commission system. Thus some type of fee arrangement or cost-plus system is likely to be used. Many large advertisers are moving away from the traditional commission system and using incentive-based systems where agency compensation is tied to performance. The performance measures may include objective measures such as sales and/or market share as more subjective measures such as evaluations of the agency s creative work. As more marketers adopt an integrated marketing communication perspective and move away from traditional mass media, changes in compensation systems are taking place. This may include a combination of compensation systems such as a negotiated set fee or media commission rate as well as incentives.