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Marketing I

Semester B Lectures 1 & 2 Strydom Chapter 9

Marketing Communication Decisions


Ever-changing communications environment
Inset communications timeline

Business world also communicates with external markets


Marketing Communication (Promotion) defined as:
Communication by marketers that informs, persuades and reminds potential buyers in order to positively influence their opinion and get them to respond (in the desired way).

Inform
Persuade Remind

Integrated Marketing Communication


Optimising the use of various communication disciplines
Evaluates the strategic use of:
Advertising
Direct Marketing Personal selling

Sales Promotion
Public Relations Publicity

Review the marketing plan and objectives Setting of marketing communication objectives Identify the target audience Determine the marketing communications budget

Select marketing communications elements


Monitoring, evaluation and control

Marketing Plan and Objectives


Clear, specific and measurable
X number of new customers by (date) X% market share by (date) Increase unit sales by X% within 6 months

Marketing Communication Objectives


Clear, specific and achievable
Creating awareness Building positive image Customer retention

To increase the preference for the Virgin Credit Card as the preferred credit card for LSM groups 7 to 10 (age groups 25 to 40) and earning above R120 000 per year

Identifying Target Audience


Influences
what will be said in all marketing communication elements; how it will be said; when it will be said; where it will be said and; who will say it.

Determining the marketing communications budget


Judgment based Data-driven

Judgment based
Percentage of sales
Fixed percentage of previous years sales. Based on argument that communication is a cost and should therefore be directly related to sales

Units sold
Based on experience and historical figures to determine the amount of communication money required to sell one unit

Judgment based
What we can afford
Usually based on historical figures and determined by top management

Arbitrary allocation
Determined by top management without any information or reasoning

Data-driven
Objective and task
Which communication methods are most likely to achieve the objectives and how much will they cost

Competitive parity
Follows the competition

Data-driven
Experimentation and testing
Experiment with spend and monitor results

Modelling and simulation


Use of sophisticated computer programming to predict what-if scenarios

Push-Pull strategies
Push product through distribution channels to customers
Induce distributors to stock and promote

Pull consumers into retail outlets


Convince consumers to purchase and demand it from outlets

Producer marketing activities Personal selling Trade promotion

Reseller marketing activities Personal selling Advertising Sales promotion

Producer

Retailer/Whole saler Push strategy

Consumers

Demand

Demand

Producer

Retailer/Whole saler
Producer marketing activities consumers, sales promotion

Consumers

Pull strategy

Other issues
Type of product
FMCG/Industrial/Pharma

Stage in product life-cycle


Consumer Decision making process

The target market


Household/Business/Industrial Localised/scattered Informed or not Complex or simple decision

Budget factors

IMC implementation
Marketing executive cannot do it alone
Ad agency Design company Digital agency Media agency PR company

Monitoring, evaluation and control


How well is campaign meeting marketing objectives
Complex due to number of communication elements

Reasons for success/failure

Advertising
Instrument that can deliver the message to the greatest number of people; therefore most expensive Most impersonal
Can promote ideas, products/services, in some instances can be localised

Media Television

Advantages Mass coverage High reach

Disadvantages Low selectivity Short message life

Sight, sound, motion High prestige


Low cost/exposure Attention grabbing Favourable image Radio Local coverage Low cost High frequency Flexible Low production cost Well-segmented audience

High absolute cost High production cost

Audio only Clutter Low attention Fleeting message

Media Magazines

Advantages Segmentation potential Quality reproduction High information Longevity Multiple readers

Disadvantages Long lead time Visual only Lack of flexibility

Newspapers

High coverage Low cost Short lead time

Short life Clutter Low attention

Interest sections Current/timely

Poor repro quality

Media Outdoor

Advantages Location specific High repetition Easily noticed

Disadvantages Short exposure time Local restrictions

Internet/interactive

User selects information User attention/involvement


Interactive relationship Direct selling potential Flexible message platform

Crowded access Technology limitations


Lack of valid measurement Limited reach

Direct Marketing
Two-way process to obtain a measurable response
Supplier Customer Measurable reply Databases

Part of overall strategy

Types of DM
Telemarketing
Direct Mail Catalogue Direct action advertising (fill in coupon, call now!)

Internet commerce
In-home personal selling (Tupperware, Amway)

Verimark
Started 1977
Focus on houseware, health and fitness, automotive, cosmetic DRTV one of largest purchasers of TV time Retail stores (Push/Pull)

Trade shows
Internet and database marketing

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