1 Chapter One

Integrated Marketing Communications

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The Nature of Communication
• Communication is defined as transmitting, receiving, and
processing information.
• Sender—the person(s) attempting to deliver a message or
idea.
• Encoding processes—the verbal (words, sounds) and
nonverbal (signs, facial expression, cues that the sender
utilizes in dispatching the message.
• Transmission device—all of the items that carry the message
from the sender to the receiver.
• Decoding—takes place when the receiver employs any set of
his or her senses (hearing, seeing, feeling, etc.) in the attempt
to capture the message.
• Receiver—the intended audience for a message.
• Feedback—information the sender obtains from the receiver
regarding the receiver’s perception or interpretation of a
message.
• Noise—anything that distorts or disrupts a message.
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FIGURE 1.2
Examples of Communication Noise

 Talking on the phone during a commercial on television

 Driving while listening to the radio
 Looking at a sexy model in a magazine ad and ignoring the
message and brand
 Scanning a newspaper for articles to read
 Talking to a passenger as the car passes billboards
 Scrolling past Internet ads without looking at them
 Being annoyed by ads on a social media site
 Ignoring tweets on Twitter because they are irrelevant
 Being offended by the message on a flyer for a local business.

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The Interactive Model of Communication
• In the interactive communication model, both the
source and the receiver serve as encoder and decoder
of a message in an ongoing process.

• This model illustrates companies’ relationships with

their customers today.
• Marketers no longer dominate the exchange of
messages; they no longer simply “talk to” customers.
• Companies are in a conversation, a give-and-take, with
customers.
- Companies send messages to customers; customers
send messages back to companies and to other
customers.
Integrated Marketing Communications
is the coordination and integration of
all marketing communication tools,
avenues and sources within a company
into a seamless program which
maximizes the impact on consumers and
other end-users at a minimal cost. The
IMC includes all business-to-business,
channel, customer, external
communications and internal
communications.

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FIGURE 1.3
The Components of Promotion

Advertising

Public Digital
Relations Marketing

Sales
Social Media
Promotions

Personal Alternative
Selling Marketing
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FIGURE 1.4
Steps of a Marketing Plan

 Current situational analysis

 SWOT analysis
 Marketing objectives
 Target market
 Marketing strategies
 Marketing tactics
 Implementation
 Evaluation of performance

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• In understanding integrated marketing
communications, it helps to review the steps in a
marketing plan. The current situational analysis
and SWOT set the stage for setting marketing
objectives and choosing the target market. Once
these are set, the marketing person can develop
strategies and tactics. IMC will be part of the
overall marketing strategy to reach consumers. It
will also be part of the tactics, which are the
plans for achieving the objectives and carrying
out the strategies. Implementation and
evaluation conclude the marketing planning
process.
FIGURE 1.5
Trends Affecting Marketing Communications

• Emphasis on accountability & measurable

results
• Explosion of the digital arena
• Integration of media platforms
• Shift in channel power
• Increase in global competition
• Increase in brand parity
• Emphasis on customer engagement

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 Accountability
and
Measurable Results
• Economic pressures
• Want results from marketing budgets
• Effort led by CEOs, CFOs, and CMOs
• Advertising agencies expected to deliver results
• Emerging social media changes communication
• Emerging alternative methods and media
• Less reliance on mass TV ads

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• Economic pressure, especially recent downturns
in the economy, has put pressure on ad agencies
and marketing officers to be accountable for their
expenditures. CEOs, CFOs, and CMOs want
measureable results. In the past, once an ad
agency was hired, they stayed with a client for a
number of years because they knew the brand.
Now, companies want results. If not, then a new
agency will be chosen. With the rise in popularity
of social media, there is less reliance on mass TV
advertising. Agencies continue to explore
alternative ways of reaching consumers where it
is less cluttered than mass media.
 Explosion of Digital Media

• Emergence of
– Interactive Web sites, blogs, and social networks
– Smartphones, tablets
• Companies shifting expenditures from
traditional to digital media
• Social media allows interaction

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• Alternative media has become the new buzz
phrase in advertising, especially online. The
Internet provides an interactivity with consumers.
Websites, blogs, and social networks all provide
two-way communications. Smart phones are
replacing cell phones, so consumers now have
the Internet with them at all times, increasing the
ways and means of reaching them. As a result,
companies are shifting dollars from traditional
media to digital media.
 Integration of Media Platforms
• Consumers integrate platforms
– 5 hours 16 minutes  non-television screens
– 4 hours 31 minutes  television
• Consumers integrate all contents from different
media platforms by themselves.
• Ways consumers integrate media formats
– Content grazing: looking at two or more screens
simultaneously to access different content.
They may be watching TV and texting a friend at the same
time, or searching for something on their iPad while
watching House of Cards on Netflix via their laptop.
Habit, the need for distraction and to kill time are the
main motivators for content grazing.
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 Changes in Channel Power

• Retailers
– Control channel
– Control shelf space
– Have purchase data
– Determine products and brands on shelves
• Consumers
– Internet shifts power to consumers
– Multiple methods of making purchases

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• Channel power has changed and is continuing to
change. For the first 60 or so years in the 1900s,
channel power resided with the manufacturers,
such as Procter & Gamble. It then shifted to
retailers, especially large chain retailers like Wal-
Mart. Retailers controlled shelf space, had
purchase data, and determined what products
and brands went on the shelves. Consumers had
to buy whatever brands a retailer stocked. Power
is now beginning to shift to consumers, primarily
because consumers do not have to purchase from
the local retail store. They have options. Retailers
who realize this are providing multiple ways for
consumers to purchase and receive products.
 Increases in Global Competition

• Information technology and communication has

changed the marketplace.
• Products can be purchased from multiple locations.
• Customers want both low prices and high quality.
• Manufacturers and retailers must work together.

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 Increase in brand parity

• Brands viewed as being equivalent

• Consumers select from a group of brands
• Quality and characteristics less important
• Price more important
• Decline in brand loyalty
Therefore:
• Marketers must generate messages in a voice that
expresses a clear difference.

• They must build some type of perceived brand superiority

for the company and its products or services.

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• With the increase in brand parity and the
decline in brand loyalty, companies have
placed greater emphasis on customer
engagement. Contact points between
customers and the product are examined in an
effort to improve communication and the
relationship. Digital media is now a critical
component of IMC plans because it provides
two-way communication. It is no longer
sufficient to talk to customers, you must
develop a dialogue with customers. The goal –
a deeper emotional commitment on the part
of consumers towards the brand.
 Emphasis on
Customer Engagement

• Marketers seek to engage customers

• Contact points important
• Digital media now part of IMC
• Two-way communication
• Strive to develop emotional commitment

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 Barriers to integrated marketing
communications
• Mind-set
• the fear of change and loss of control felt by
individuals associated with the industry.
• agency creatives’ aversion to integration and
their lack of willingness to work across the
media and promotional mix tools.
• Structure of organisations
• Rigid organisational structure. Managers believe
that rigid organisational structure protects their
budgets and power, losing power and control was
one of the doubts facing public relations
practitioners and advertising agencies
• Some organisational structures separate
communications and information, and even
decrease managers’ coordination. For example, the
Public Relations Department does not usually
report to the Marketing Department as they are
separate departments, and the sales force seldom
knows about advertising messages. What would
happen if sales representative were informed about
the new promotional offers? More integrated
messages to customers, which will lead to increase
credibility, is a probable outcome.
• Agency remuneration systems
• This particularly applies to advertising
agencies whose income has traditionally come
from media commission. There has, therefore,
been a strong incentive for advertising
agencies to favour advertising activities above
other forms of marketing communications.
The systems of agency payment are now
changing.