Type:
Solution Manual
Integrated Marketing Resource: Communications Strategic Planning Perspectives Edition:
5th Edition
Author(s):
Keith Tuckwell
INSTRUCTOR’S MANUAL Diana Serafini Dawson College
Integrated Marketing Communications: Strategic Planning Perspectives Fifth Edition Keith J. Tuckwell St. Lawrence College
Chapter 1 Integrated Marketing Communications: An Overview Learning Objectives Students will be able to: 1. Appreciate the role of integrated marketing communications planning in business today 2. Identify the components of the integrated marketing communications mix 3. Identify the conditions that have led to the emergence of integrated marketing communications 4. Explain how knowledge of consumer behaviour concepts influence marketing communications strategies 5. Identify basic ethical issues confronting marketing communications practice 6. Describe the role that laws and regulations play in guiding marketing communications in Canada
Chapter Highlights Changes in the marketplace, changes in the media communications industry, and changes in customer behaviour have created an environment in which customers are approached in a very different manner. Organizations are now looking for “total communications solutions” and are searching for expertise that will provide it. Disjointed marketing communications strategies are a thing of the past; organizations want integrated marketing communications strategies to resolve their business problems. Organizations today are searching for complete solutions to their communications needs and in that respect are calling upon experts in various marketing communications areas to get the job done. Change is occurring rapidly, mainly due to technology. Organizations are incorporating new digital communications techniques with traditional media alternatives in order to respond to consumers’ changing media habits. Moreover, there has been a movement towards more targeted media and away from mass media to create the “buzz” for brands amongst consumers. There is heavier reliance on digital media options and more personalized activities, such as social media outlets and experiential marketing as opposed to the traditional broadcast (TV, radio) and print alternatives (magazines, newspapers). A. The Integrated Marketing Communications Mix Integrated marketing communications involves the coordination of all forms of marketing communications into a unified program that maximizes the impact of the communications on customers. Today, this must include an effective and well-planned social media strategy. It embraces branding strategies, packaging strategies, media strategies in traditional and non-traditional media, and other forms of communications such as personal selling, sales promotion, events and sponsorships, and public relations. Any customer touch-point is part of integrated marketing communications. The fundamental nature of each form of communications can be described as follows:
Advertising – Is the placement of persuasive messages in time and space purchased in any of the mass media by organizations who seek to inform and persuade members of a target market about .
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their products, services, organization, or ideas. Advertising embraces message and media strategies that are designed to encourage awareness and interest for a brand or company.
Promotional Advertising - Advertising is usually product-oriented, that is, it communicates something unique about the brand; or it is promotional-oriented, that is, it communicates some incentive to motivate customers to take some desired action.
Direct-Response Communications – A form of communications that can reach an audience directly (without the use of traditional mass media). The most common forms of direct-response advertising are direct mail and direct-response television.
Digital (Interactive) Communications – In an integrated marketing communications context digital communications are commercial messages for an organization placed on the Internet, a cell phone or other personal electronic device or a DVD. Technology is fueling the movement towards electronic forms of communications. Internet advertising, social media, Web site communications, and cell phones are effective media for reaching consumers, particularly younger consumers. Mobile communications represent a third screen to reach consumers with a video message. These forms of communications play a bigger role in the communications mix now and in the future.
Sales Promotion – Activities and incentives that stimulate immediate reaction from consumers and distributors. Sales promotions embrace consumer promotions such as coupons, contests, and premiums that help pull a product through the channel; and trade promotions such as discounts and allowances that help push the product through the channel.
Public Relations – A form of communications that is designed to get public understanding and acceptance. Public relations messages influence the attitudes and opinions of interest groups to an organization. Unlike advertising, which is paid for, public relations attempts to get “free” exposure for a brand or company. The goal is to generate a positive attitude toward the product or organization. It also plays a key role when a company finds itself facing a crisis situation. Company sourced social media is now an effective and critical part of public relations.
Experiential marketing – Is a blend of marketing communications disciplines that engage people with a brand in a more personal way. The core of experiential marketing is event marketing where consumers are immersed in a branded experience. The experience could be anything from attending an event where a sponsor’s product is freely distributed to devising a specific branded event that becomes the focal point of an entire integrated marketing communications campaign. Event marketing, therefore, involves planning, organizing, and marketing an event whether it is an event for a company or a brand of a company that integrates a variety of communications elements.
Sponsorship is considered to be a key piece of experiential marketing, and simply means that a company provides money to an event in return for specified marketing privileges for being associated with the event. Events and sponsorship programs are designed to build the image of the organization or brand. An organization can reach a consumer in an environment where they are more receptive to messages. Experiential marketing is a growing component of the marketing communications mix. Marketers are attracted to events because they reach their target market directly and improve brand awareness when associated with the right event.
Personal Selling – The delivery of a personalized message between a seller and a buyer. Personal selling plays a key role in delivering messages to distributors who resell products and to consumers .
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who shop at retail locations. Knowledgeable salespeople play a key role in building consumers’ perceptions about a product. The integration of these components to present a unified message creates a higher level of impact on the target audience. The right combination of promotional components best suited to meeting the brand’s communication objectives is the key to success. B. Factors Encouraging Integrated Marketing Communications Today, companies use a cooperative approach to communications problem-solving and planning, an approach that provides creative solutions. Several key issues and trends affect and will continue to affect marketing communications practice:
Media Consumption Trends and the Shift to Digital Media – Consumers are spending less time with print and broadcast media and more time with the Internet and mobile communications devices. Television viewers are going “on demand” and are streaming their favorite shows to their computers or TVs, and this presents new advertising opportunities. Younger generations that have grown up with technology are still the leaders in digital media consumption trend. Consumers’ attention is also constantly shifting from one platform to another (content is consumed across multiple devices), and this highlights the challenge of reaching people with advertising messages and points to the need for well-planned strategies.
Social Media Penetration and Popularity – Recent data indicates that Canada has the highest social media penetration in the world, with 82% of Canadians versus 75% of Americans using a social network The most popular social networks are Facebook, followed by Twitter than Google. All age groups are now online so social media advertising is a natural extension of a brand’s communication strategy. There is also a growing number of social media metrics used to evaluate the impact of social media on sales revenue and market share, but the greatest value is in the dialogue-style of marketing present in social media.
Mobile Communications: The Next Big Thing – Mobile communications devices are becoming a vital means for communicating product information and for conducting business transactions with consumers. In Canada, 68% of cellphone subscribers have a smartphone, and one in five households the cell phones are the only form of telephone service. With consumers’ eyeballs shifting from the “big screen” (television) to the “small screen” (laptop computers and mobile devices) companies are reacting by experimenting with new media communications mixes to more effectively reach and impact target audiences.
Database Management Techniques and Customer Relationship Marketing – Via database management systems companies continuously collect and analyze information about customers. This buyer information is then used to design communication plans that meet the consumer’s unique needs. Organizations now possess the capability to communicate with customers individually, rather than collectively. Interactive forms of communications are the outcomes of database management programs. Relationship management programs are concerned with establishing, maintaining, and enhancing long-term relationships. Effective promotional programs are personalized to customer needs. A good CRM program gives appropriate attention to attracting new customers and retaining existing customers. For example, some promotional activities (like samples) attract new customers while loyalty-oriented promotions help retain existing customers. .
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Demand for Efficiency and Accountability – With increasing constraints on marketing budgets, managers are demanding more efficient use of promotional expenses and more measurable return on promotional investments. There is intense pressure on managers to design and implement programs that will have a more tangible influence on business. Since digital media options tend to be more measurable (consumer responses can be tracked electronically) their popularity has increased.
C. Consumer Behaviour Essentials Consumer behaviour is the study of how people buy, what they buy, when they buy it, and why they buy. Essentially, consumer behaviour is the psychology behind marketing and the behaviour of consumers in the marketing environment. Effective marketing communications campaigns are rooted from a solid understanding of essential consumer behaviour concepts: Needs and Motives – Individuals have a need when they perceive the absence of something useful; a motive is a condition that prompts the individual to satisfy the need. An appealing presentation of a product’s benefits acts as a source of motivation. Maslow’s hierarchy of needs and theory of motivation has an impact on marketing communications strategy. The theory is based on two assumptions: 1. When lower level needs are satisfied, a person moves up to higher level needs. 2. Satisfied needs do not motivate. Behaviour is influenced by needs yet to be satisfied. Individuals pass through five levels of needs: physiological needs, safety needs, social needs, esteem needs, and self-actualization needs. People are more alert about and receptive to communications that meet their needs. Teenagers for example, are tuned into messages from fashion retailers to ensure they wear the right clothes—their social needs are a priority and clothing and accessories play key role in social acceptance. Personality and Self-Concept – This refers to a person’s distinguishing psychological characteristics; characteristics that are influenced by family, friends, and society. The self, as explained in the SelfConcept Theory has four components:
Real Self – You as you really are Self-Image – How you see yourself Looking-Glass Self – the way you think others see you Ideal Self – How you would like to be
Organizations understand that goods and services that help fulfill the looking-glass self and ideal self are appealing to consumers. The importance of self-image today is being expressed by male consumers who are demanding more personal care products that make them look and feel good about themselves. Both sexes are concerned about aging—they want to look and feel younger, hence the blitz in marketing activity for products such as face scrubs, moisturizers, and cleansing products are now very popular. Attitudes – Attitudes are an individual’s feelings, favourable or unfavourable, towards an idea or object. Typically, an organization presents its products in accordance with prevailing attitudes. The change towards a more health-conscious lifestyle has led to many new health-oriented product developments and communication strategies that focused on this better lifestyle, such as the Kellogg’s Special K “good for you” positioning. Marketers must keep track of attitude changes. .
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Perceptions refer to how individuals receive and interpret messages. People perceive the same product differently, and for a variety of reasons. Perceptions differ because individuals are selective about the messages they receive and retain. There are three levels of selectivity:
Selective Exposure – Noticing information of interest Selective Perception – Screening out messages that are in conflict with attitudes and beliefs Selective Retention – Remembering only what we want to remember
The challenge is to penetrate the perceptual barriers by designing messages and media strategies that will command attention and spur action. Consumers tend to tune out messages they don’ like or get annoyed by—too much of anything is not a good thing it seems. Conversely, if the consumer is contemplating buying something, say a new television or automobile, they suddenly tune in messages from products in these categories. Reference Groups – Groups of people that individuals associate with have considerable impact on behaviour and buying decisions. When an individual joins a group there is tremendous pressure to conform to the group’s norms—to fit in! You do what the group does. You wear what the group does, and so on. In the case of a fraternity, if a certain brand of clothing such as Polo or Ralph Lauren is popular with key members, then new members or members with less seniority will likely wear that brand. Family Influences – According to a recent study family and friends are the number-one influences on women’s decision making. Marketers look to social media to tap into influencers. Each member of a family has some influence of the behaviour of the family unit and the buying decisions of that unit. Marketing organizations must be aware of the changing roles and responsibilities within the family and adjust their strategies accordingly. The promotional messages, as expressed in all media forms, must reflect contemporary lifestyles. Double targeting are marketing strategies aimed at reaching both genders effectively. The new featured story entitled Boston Pizza Goes Family (IMC Highlight on page 22), demonstrates how changing demographic variables impact marketing and marketing communications decisions. Boston Pizza’s campaign takes a more inclusive approach in focusing on dads, moms and children and promoting sports and the family message. There is a recognition that both parents share the responsibility in getting their kids to various sports activities. To be different and more competitive Boston Pizza is moving away from the male focus of “hanging out with friends” and showing a “family sharing responsibility and spending time together”. D. Business and Organizational Buyer Behaviour Consumers buy on emotion; organizations make more rational decisions. The business- to- business (B2B) market is quite different from the consumer market. The B2B market is: smaller, concentrated geographically; the buying criteria are very practical; and a formal buying process is used in order to make informed buying decisions. The key criteria are:
Quality – consistent quality on every order Service – prompt service initially and ongoing Continuity of Supply – long-term supply to ensure for efficient production of goods
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Price – price is evaluated in the context of other criteria (long-term savings could outweigh low initial price).
In terms of process an organization will use a buying committee or buying center. A buying committee is usually comprised of representatives from key areas such as marketing, production, engineering, finance, purchasing, and so on. Participants are comforted to know that costly decisions are shared decisions. A buying center is an informal structure and process with members involved in certain roles:
Users – Those who use the product Influencers – Those who assist in defining specifications Buyers – Those with authority and responsibility to select suppliers Deciders – Those with the power to select the actual supplier Gatekeepers – Those who control the flow of information to others
If this process is used, the marketer must identify key individuals and then develop appropriate and effective communications strategies to reach and influence those individuals. From the IMC mix, personal selling and direct forms of communications are vital components for influencing business buyers. E. Integrating and Partnering Influences B2B Communications Strategies Business-to-business marketing organizations have embraced customer relationship management and marketing practices. The formation of long-term partnerships and collaborative practices among members of a channel of distribution is now very common. Communications strategies for reaching B2B organizations are also evolving with technology. Creating awareness through traditional media is the first step. Event marketing and trade show participation keep a product on the buyer’s radar screen and direct-response communications help create interest and desire. Web-based communications are also essential in B2B marketing. Similar media tools are employed in consumer marketing, but in B2B, the weight given to the various components is quite different.
F. Ethical Issues in Marketing Communications Practice The way an organization communicates is always under review by the public and critics of the marketing communications industry. Rightly or wrongly, planned or unplanned marketing communications sometimes deliver messages that spark controversy. Many organizations tolerate the controversy as long as the campaign is delivering sales while others bow to public pressure and remove offending messages. The following issues make headlines on a regular basis.
Privacy Issues in an Online World –Data collected by organizations should not be used illegitimately. Data is available quickly and gives marketers the ability to focus their communications on personal interests. Consumers increasingly fear their privacy is being invaded. PIPEDA (Personal Information Protection and Electronic Documents Act) provides guidelines on the disclosure of customer information. Sex in advertising – A common complaint about advertising revolves around the use sex to sell something. As an old saying goes “Sex Sells!” Using sex to sell a product is natural, but the question is how much sex – what is considered to be gratuitous. Advertisers must walk a fine line between what is tasteful and what is distasteful. .
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Dangerous or Disturbing Advertising – When a marketer goes to extremes to get a message across, such as using disturbing situations or creating worrisome situations via email, ethical practice is being challenged. Misleading advertising – Sometimes ads can mislead the public or simply misrepresent the brand. Sometimes the public misinterprets the advertiser’s message and the campaign backfires. The control of misleading advertising is the responsibility of Advertising Standards Canada. Exaggerated green claims – With a renewed public focus on the environment and sustainability, advertisers have been busying themselves making claims about how green their products and services are, and how they protect or minimize negative impacts on the environment. Recent market research shows that Canadians are considered the environmental impacts of their products and services when they make their purchases. Companies run into problems when they exaggerate these claims, or by telling half-truths or by only presenting part of the argument for and against buying a product or service. Targeting Children – Advertising messages directed at children often bypass parents. As a result, parents are concerned about the content of these messages, which have a powerful influence on the child’s behaviour. Children may start demanding higher-priced “in” goods when parents prefer to buy less expensive alternatives. In other words, at what age do children become “brand conscious” Cultural Diversity – Canada is an increasingly diverse country from a cultural point of view, particularly our largest metropolitan centers. Advertisers must make strides to ensure that their communications efforts reflect this diversity, or risk alienating certain ethnic populations who feel they are under-represented in contemporary IMC campaigns. Laws and Regulations Governing Marketing Communications – The marketing communications industry in Canada is highly regulated. Regulation and control come from Advertising Standards Canada, which administers regulations based on codes of practice that are voluntarily established; and the Competition Bureau (a federal agency) through the Competition Act which established laws and regulations for all marketing activity in Canada.
The rapid pace of change in business today has forced organizations to re-examine and change the way they communicate with customers. A key issue facing organizations today is the increasing use of digital media and social media by consumers. Mobile media is growing as a preferred source. Privacy concerns are growing along with this rise of digital media. More than ever before, organizations are demanding integrated marketing strategies to help resolve marketing problems and to take advantage of new opportunities.
Answers to End of Chapter Questions Review Questions 1. The components of the integrated marketing communications mix include various traditional and non-traditional media forms. Traditional media include television, radio, newspaper, magazines and a host of out-of-home advertising alternatives. Non-traditional and integrated media include direct-response communications (direct mail, direct response television, telemarketing and catalogues), digital communications (internet communications, social media and mobile technologies), sales promotions, personal selling, public relations, and experiential marketing (event marketing and financial sponsorships). Effective communication integration also considers branding strategies (brand name, logo and trademarks), the package itself, and various other consumer touch points (company communications to its public). 2. Product advertising provides information and helps build an image for a product, while promotional advertising is designed to accomplish a specific task – usually to communicate a .
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special offer to elicit some kind of immediate response from the customer. Including some kind of coupon or contest promotion with a print advertisement, for exam, is a form of promotional advertising. 3. The emergence of integrated marketing is attributed to trends such as media consumption trends (changes in consumer media habits) and the shift to digital media, social media penetration and popularity, increased use of mobile communications, the focus on customer relationship management programs via the use database management techniques, and the demand for efficiency and accountability in organizations. 4. Consumers tend to be influenced by their emotions. Therefore, a sound knowledge of fundamental consumer behaviour concepts is essential in order to devise marketing communications strategies that “press the right buttons.” Individuals are receptive to messages that are congruent with their needs, what they need now or what they may need in the future. Maslow’s theories help to explain levels of consumer needs. Effective communications show how a certain product will satisfy those needs and the message will be presented a convincing manner appropriate for the customers being targeted. 5. The self has four components: real self (you as you really are); self-image (how you see yourself); looking-glass self (how you think others see you); and ideal self (how you would like to be). It is common for messages to focus on the looking-glass self and/or the ideal self since consumers hold a high importance on how others view or see them, and/or on their aspirations to look better with the products they purchase. 6. Assessing attitudes is very important. Communications strategies should be devised in accordance with the prevailing attitudes of the target market. Not to do so, presents risk and whenever attempts are made by communicators to change attitudes, the costs are much greater. Effective marketing research programs allow an organization to stay in touch with their customer’s attitudes. Investing money in research to gain knowledge will save money in the long-term; money that may be wasted sending out ineffective messages. 7. Peer pressure from reference group members is a significant influence on buyer behaviour. The desire to “fit in” is paramount so actions taken by a group member are designed to ensure that they fit in. This may influence decisions on what to wear, what to eat and drink, what music to listen to, what activities to participate in, and so on. Members of a group are attracted to products that show a meaningful association with the group. Mountain Dew, for example, effectively portrays a lifestyle that is popular with a segment of the teenage population. 8. Double targeting refers to marketers needing to reach both genders effectively. Purchasing patterns and roles and responsibilities are continually being redefined, and many typical male or female slanted purchases are now being influenced by the other sex or have become joint purchase decisions. For example, Car buying was typically a male dominated activity – but women are exerting more and more power over this important purchase, and the automotive companies are responding with more female influenced and family friendly designs and innovations. 9. Buyers in business and industry are rational in nature. Before making a buying decision, particularly on goods or services where the cost is high, careful attention is paid to a predetermined list of criteria. The criteria normally include quality, service, continuity of supply, and price. Price is usually considered in conjunction with the first three criteria. The lowest price is not always selected since long-term cost savings could outweigh a low initial price. .
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10. A buying committee is a formal arrangement employed by business organizations to evaluate prospective suppliers. The committee draws upon cross-functional expertise within the company and collectively the members of the committee evaluate suppliers and make decisions that are in the best interests of the company. Decisions made are shared decisions. A buying center is an informal structure where participants have varying levels of authority and control. In this situation, marketers must identify the members with authority and focus their efforts on them if a decision is to go their way. They must also impress members who influence the decisions, but do not actually make the decisions. 11. The Competition Bureau is a government body responsible for the administration and enforcement of the Competition Act, a law that governs business conduct and marketing practices in Canada. Advertising Standards Canada is the industry body committed to creating and maintaining community confidence in advertising. Its mission is to ensure the integrity and viability of advertising through industry self-regulation. Discussion Questions 1. More and more Canadians are shifting their time from the “big screen” to the “small screen”, and in many household’s TV time has been replaced by Internet time. In the battle between the Internet and the TV, it seems the Internet is emerging as the clear winner. Recent Canadian data (2014) from Numeris RTS Canada shows that the 18-34 years old age group spends on average 33 hours per week on the internet and only 15.3 hours per week watching TV. This age group spends more than double their time on the Internet as compared to TV, a shift to digital communications is a definite trend. Social media in Canada is also growing in importance with over 16 million Facebook members (48% of the population). Nielsen research supports the fact that the reach of social networking and blogging venues are growing at twice the rate of the Internet (like portals and emails). Lastly mobile communications are a vital communication tool. There are now 24.5 million wireless subscribers in Canada and 5.7 million subscribers of mobile broadband. More and more evidence is detailing the digital, social media and mobile technology trends, and marketers are taking advantage of this cultural and technological change, by shifting their marketing spending from more traditional to new electronic and digital media. 2. According to a major international study by London based MICE Group, experiential marketing is forecast to become one of the biggest growth areas in marketing in the next five years. Spending in this area is set to grow as marketing budget holders now believe that it offers considerable advantages over other marketing tools, especially in building brand loyalty and encouraging word of mouth recommendation amongst consumers. The majority of respondents (80%) described experience-based activities as being important within their marketing mix, accounting for around one third of their entire marketing budget; a percentage set to rise in the future (Source PR Newswire). Students should be able to cite the shifting landscape in marketing spending, and see online and experiential marketing as the benefits of a decline in spending in traditional marketing channels. 3. In the context of business-to-consumer marketing, relationship marketing communications strategies will be much more of a factor in the future. A company has to balance its spending so that it is investing in programs that attract new customers (for growth) and retain current customers (to find ways do making them buy more goods). Theory holds that the costs of retaining a customer are much lower than attracting a new customer. Therefore, a wise organization is managing the customer relationship in order to maximize the value of the customer. Marketing communications plays an essential role in keeping in touch with the customer to ensure that needs .
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are being satisfied and to suggest how new products and services can be of use. Generally speaking, traditional forms of communication can be used to attract customers while nontraditional forms of communications are better suited for customer retention and maintenance. 4. To get the students started you may ask them to go to a company website to examine the various types of marketing communications they integrate on their website. The students should identify and evaluate the promotions in the context of how they employ various aspects of consumer behaviour principles, more specifically how communications are directed to consumers’ needs and motivation (Maslow’s Hierarchy of Needs), personality and self-concept, reference groups and peer influences, and family influences. 5. Since the answer calls for a strategic solution for building and sustaining a brand, student responses will vary. The objective is to get students thinking about how to best employ the various components of the marketing communications mix. They should first also consider the target market profile for each brand when making any recommendations and identify their preferred media. The students can also be encouraged to notice that the identified brands are fairly mature, with brand awareness being generally high in most markets and thus the communication objectives would most likely be based on building further preference or maintaining the brand image. 6. Responses will vary based on the examples cited by students. Students may consider that Canadian standards are more conservative than those in Europe, but may be less so that those in other countries. Students should consider the impacts of risky or controversial messages, particularly as it relates to children and under-represented minorities. Successful communication is about finding a balance that is good for both you and your customers, but considers the needs of the society as a whole. You want to be able to push the creative envelope at times, but you don’t want to court disaster buying taking a message one step too far.
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Chapter 2 Strategic Planning Principles Learning Objectives Students will be able to:
Identify essential external trends and conditions that influence organizational planning
Describe the steps in the strategic planning process
Identify the distinctions and relationships between the various types of plans
Characterize the essential elements of a corporate plan
Outline the structure and content of a marketing plan
Outline the structure and content of a marketing communications plan
Show how integrated marketing planning provides solutions to marketing problems
Chapter Highlights Strategic business planning is an integrated process that involves the various management levels, operating divisions, and functional departments of an organization. A. Strategic Planning and Factors Influencing Planning Strategic planning embraces three variables:
Objectives – statements that outline what is to be accomplished
Strategies – statements that outline how objectives will be accomplished
Tactics (Execution) – the plan of action in specific detail
Strategic planning is a cyclical process (e.g., an annual occurrence with revisions while a plan is in progress). Strategic plans are influenced by various external factors: the economy, demographic trends, changing technologies, and various laws and regulations.
Economic Influences – The state of the economy often dictates how aggressive or conservative a company is with its plans. The state of the economy is determined by such factors as growth rates in GDP, inflation rates, levels of employment, and the value of the dollar in relation to foreign currencies. The relationship among these variables is dynamic. An economy tends to go through cycles (the outcome of these variables): recession, depression, recovery, and prosperity. Companies need to adapt to each of these cycles. Some retailers, like Dollarama, Canada’s largest operator of dollar stores expanded in 2014 and benefitted from consumers’ concern for household debt and the weak economy. .
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Competitor Influences – The type of market a company operates in has an impact on the nature of planning. The various structures include monopolies, oligopolies, and monopolistically competitive markets. Competition is classified as being direct (competition from alternative products) or indirect (competition from substitute products). The lines between direct and indirect competition is less today than previously. For example, Loblaws and Wal-Mart once operated in separate markets. The addition of new product lines by each company now makes them direct competitors. As well, the trend towards online shopping has impacted retailers. In 2015, Future Shop closed its doors throughout Canada. Owned by Best Buy, the two-banner arrangement caught up with the company as it saw its retail costs increasing while customer visits to stores were dropping. The company has since decided to invest more money in e-commerce under one banner.
Demographic Influences – Adjusting business strategies to fit with demographic trends is essential. The key trends include the following: 1. 2. 3. 4. 5.
The population is aging The trend towards urbanization continues Changing household formations Increasing ethnic diversity Reductions in the growth of disposable income
Generally speaking, the population is aging. The country’s largest demographic cohort (baby boomers, who are estimated to be 40% of the Canadian population by 2021), are reaching retirement age. As they age the average age of Canadians gets higher. Gen Y are tech-savvy and a main target for many companies. They are very different than baby boomers with respect to their needs and wants. There is an increasing trend toward urbanization, with 80% of Canadians living in urban areas. Household composition is also changing; the average household is smaller, and fewer couples are married. There is more acceptance of gay couples. Canada is also increasingly ethnically diverse, (20.6% immigration rising to 23% by 2017). There is also greater income inequality and reductions in the growth of disposable income. Lower- and middle-income Canadians (the masses) are more cautious about how and on what they spend their money. Walmart’s ongoing communication slogan “Save Money. Live Better” effectively taps into consumers’ need for good value pricing.
Social Influences – It’s the role of marketers to keep track of social and cultural changes. Canadians are reporting that they are finding their lives to be increasingly hectic. Many companies have responded by providing on-the-go services to this demographic. There is also an increasing focus by Canadians to make healthier lifestyle and food choices. Lastly, there is an increasing concern for the protection of the natural environment, and Canadians are considering the environmental impacts of their purchasing decisions. There is also a greater pressure on companies to be ethical and take stands on social issues.
Technology Influences – Technology embraces discoveries, inventions and innovations. New technologies present new opportunities for companies. Canadian society has been quick to embrace technology meaning that future marketing plans and marketing communications plans will have a technological focus. For example, the means of communicating with prospective customers will rely more on electronic communications and less on traditional mass media communications. Smart phones such as the Samsung Galaxy or the iPhone, or tablets such as the “Samsung 11” or the Mini iPad are everywhere, and Canadian companies are re-examining their media buying mix, to ensure that they have an increasing profile in digital mediums. This has resulted in a reduction in expenditures on traditional media formats such as print, TV and radio. Canadians have also .
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integrated social media. Consumer generated content on YouTube, Facebook or Twitter are a strong form of marketing communications for a brand.
Legal and Regulatory Influences – Laws and regulations govern business practice. Industry Canada regulates Canadian businesses through the Competition Act. It cannot be assumed that all companies follow ethical practices. Numerous companies have made headline news for their corporate malaise in recent years. With regard to communications, a company must be careful about advertising claims made for its products. They cannot misrepresent the product nor mislead the public. There is also an increasing focus on privacy and the protection of personal information held by companies. Canadians are protected by privacy laws, including the Privacy Act, which places limits on the collection, use and disclosure of personal information.
Mountain Equipment Co-op (see IMC Highlight on page 42) has carefully assessed market trends in the sporting goods market and successfully implemented a new communications campaign to pursue an urban target market. B. Strategic Planning Process “Top down and bottom up” may describe how the planning process works. Typically, the corporate plan is formed by senior executives and passed down the functional departments. In multi-product companies marketing plans are formulated for each product. Within the marketing plan the role of marketing communications is determined and funds are allocated to carry out the plan. The integration of all components in a strategic plan for a product, and then the entire company helps the organization achieve its business objectives. As in war, a unified attack offers a better chance of success. C. The Corporate Plan Corporate planning is done by senior management and usually includes three key elements:
Mission Statement – A statement of an organization’s purpose. It reflects the operating philosophy of the organization and the direction the organization is to take.
Corporate Objectives – Quantifiable goals that can be easily measured for success or failure (e.g., sales, profit, market share, and return on investment).
Corporate Strategies – Statements outlining how objectives will be achieved. The organization assesses its strengths and weaknesses, research and development capabilities, and commitment to particular goals, and financial resources available.
The strategic direction a company takes varies but some common directions include:
Divestment Strategies – A company decides to sell off various divisions, subsidiaries or products. (e.g., P & G sold Pringles to Kellogg’s Co in a move to focus on personal care and household goods.)
Penetration Strategies – A company decides to pursue the competition aggressively (e.g., the “Cola Wars” between Coca-Cola and PepsiCo).
New Product Development – Real growth often comes from new products (e.g., Apple Computer’s presence in the music industry with iPods and iTunes). .
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Strategic Alliances – Two or more companies form an alliance to collaborate their efforts in pursuing a particular market (e.g., in-store Starbucks –licensed stores.).
D. Marketing Planning Marketing planning involves analyzing, planning, implementing, and controlling marketing initiatives to satisfy target market needs and achieve organizational objectives. A target market is the group of persons for whom a firm creates and markets a product that specifically meets the needs and preferences of that group. A company creates a target market profile, which identifies demographic (age, gender, income) psychographic (lifestyle, attitudes, interests, opinions), geographic (urban/rural, region) and behavioural (consumption patterns) traits of the people or businesses that make up that market segment. A marketing plan summarizes the relevant background information leading up to the plan, and the objectives, strategies, and tactics that are part of the plan. Marketing planning involves four essential steps: 1. 2. 3. 4.
Analyzing market opportunities Planning Implementing marketing programs Managing/controlling marketing programs
Marketing plans are action-oriented and short term (1 year). It’ a good strategy to have contingency plans (alternative action plans) to modify the original plan if necessary. A marketing plan is divided into two major sections: background and plan. The following are key areas of the background section of the plan:
External Influences – A review of economic trends, social and demographic trends, technology trends and regulatory trends.
Market Analysis – An evaluation of market size and growth, regional market importance, market segment analysis, and seasonal trends.
Target Market Analysis – The identification of the primary and secondary customer groups along with their characteristics, lifestyles, and habits. Other concerns include their degree of brand loyalty and understanding of what factors influence their buying decisions.
Brand Analysis – A review of sales trends, market share trends, distribution trends, marketing communications programs, and any new product activity that has been recently undertaken.
Competitor Analysis – Knowledge of key competitor’s sales volume, market share, and marketing strategies are analyzed for effectiveness.
SWOT Analysis – An attempt is made to interpret the data collected in the above sections, focusing on internal strength and weaknesses and external opportunities and threats. The marketing plan section includes the following information:
Positioning Strategy Statement – A statement that reflects what the brand stands for. It is the desired image that the company wants to instill in the customer’s mind which guides the direction of marketing communications. (e.g., VISA gives you the confidence you can do anything.) .
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Target Market Profile – A thorough description of the customer based on demographic, psychographic, behavioural, and geographic characteristics.
Marketing Objectives – Statements identifying quantifiable goals for a one-year period (e.g., to increase specific brand market share from 5% to 5.2% by 2017.).
Marketing Strategies – The role and contribution of each element of the marketing mix are identified and resources are allocated to each element. These strategies provide guidance for the development of marketing communications plans.
Marketing Execution (Tactics) – The identification of specific marketing actions (the action plan). All details are mapped out according to type of activity, timing, and cost.
Budget and Financial Summary – The financial implication of the plan must be communicated to senior management. Typically, a profit and loss statement for the product is included in the plan. The statement will compare previous year’s financial performance to the current year to date, and the plan year.
Evaluation and Control – Marketing plans are reviewed while in progress to determine if changes are necessary. Marketing control is a process of measuring and evaluating results of actions taken and planning corrective action when necessary. Companies often build in contingency plans that can be quickly implemented should certain situations develop in the marketplace.
E. Marketing Communications Planning The marketing communications plan and any plans for individual components of marketing communications rely on guidance from the marketing plan. A marketing communications plan is a document that encompasses key components of various communications plans (e.g., advertising, public relations, sales promotion, events and sponsorships, personal selling, and so on). When devising the plan, it is crucial that the role and contribution of each component be identified. An integrated plan will present a unified message to the target market. It is essential to select the best mix of marketing communications components. F. Marketing Communications Objectives Objectives tend to be diverse in nature yet specific in scope. Typical objectives include:
Building awareness Altering perceptions Differentiating brands Attracting new targets Encouraging more use Offering incentives Creating leads Motivating distributors
To achieve such objectives a variety of communications is necessary. Advertising is good for creating awareness and interest; sales promotions are good for stimulating action; public relations are good for building image and altering perceptions. The challenge is to select the right form of communications or combination of communications to meet the challenge at hand. .
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In the IMC Highlight (page 59) Buick: Going Younger, General Motors has typically been identified as catering to a mature male market. The company assessed the brand’s positioning in the market and analyzed the social and demographic trends and decided to attract a new target market. They have realized the path to success by repositioning the Buick brand to attract new, younger, female consumers with a new campaign. G. Marketing Communications Strategies This section of the plan provides an outline on how the various components will be used and how much financial resources will be allocated. The various components and plans include the following:
Advertising Plan – This plan is divided into two essential areas: creative and media. The creative plan is concerned with the message and how it will be communicated. The media plan involves strategic decisions on what media to use and how much money to invest in the chosen media. The goal of the media plan is to spend the funds efficiently; that is, maximize reach and impact at minimum cost.
Direct Response Plan – Direct response techniques are increasing in popularity since they can be measured for effectiveness. Advancing technology and database marketing techniques also encourage more use of direct response communications (e.g., direct mail, direct response television and online communications).
Interactive Plan – Consumers are increasingly accepting the role of online advertising communications, Online communications combined with other interactive alternatives such as cell phones, CDs, DVDs, and video games also require careful planning if messages are to be delivered effectively. Overall the last couple of years’ social media forms such as Facebook, Youtube and Twitter have become increasingly common vehicles for marketers to communicate with customers and key stakeholder groups.
Sales Promotion Plan – These are plans that reach and influence distributors, consumers, and the sales force. Plans are designed to meet various sales and market share objectives. Consumer promotions are designed to encourage trial purchase, repeat purchases and to build brand loyalty. Trade promotions are offered to encourage larger orders from distributors and to secure merchandising support at point-of sale.
Public Relations Plan – The goal of public relations is to enhance a company’s public image. These communications can be for the entire company or for individual brands. Public relations also play a key role in communicating with the public should a company face a crisis situation. It is also a good medium for spreading good news about a company and its brands. Because it is an “unpaid” medium for the most part, it is an attractive and efficient way to get the message delivered.
Experiential Marketing Plan – These activities play a greater role today, and the focus is increasingly on engaging consumers in a brand experience. The primary vehicle for this is developing unique branded events that appeal to a highly targeted audience who have an affinity for your brand or product. A variety of marketing communications elements are incorporated into successful event planning; this information must be documented in the communications plan.
Personal Selling Plan – The sales representatives play a key role in communicating messages in the channel of distribution. There are direct links between the sales plan, the advertising plan, and sales .
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promotion plan. The sales force has direct contact with distributors who make important buying decisions. Therefore, time is well spent developing push strategies that will compliment the pull strategies of other marketing communications media.
Calendar of Events – detailed visual of planned activities and when they occur.
Budget Summary – summary of costs associated with the planned activities.
Answers to End of Chapter Questions Review Questions 1. The external trends and conditions that must be considered when developing a plan include: economic influences; competitor influences; social and demographic influences; technology influences; and legal and regulatory influences. A company must be aware of the environment in which it operates in order to develop appropriate marketing and communication strategies. 2. The key components of a corporate plan are the mission statement, a list of overall objectives that are to be achieved; and an outline of strategies that will be employed to assist in achieving the objectives. A corporate plan provides a framework for all divisional plans and functional plans in the company. When the planning process is complete all of the various plans will complement each other and strive to achieve the business objectives that are outlined in the corporate plan. 3. A mission statement is a statement of an organization’s purpose and an indicator of the operating philosophy the organization follows. A company establishes its mission and then develops strategic plans to achieve the mission. All strategic plans and specific activities within the plans are evaluated against the mission of the company. 4. The four variables are demographics, psychographics, geographic and behaviour. Demographics refer to the characteristics of a population such as age, gender, income or occupation. Psychographics describe a customer group in terms of lifestyle, attitudes, interests, opinions and activities. Geographic information includes the analysis of national, regional populations and the differences between rural and urban populations. Behavioural characteristics involve the study of consumption patterns for products and services by people or businesses in the target market being researched by a company. 5. A positioning strategy statement identifies what a brand stands for. Hopefully, effective communications will instill the desired perception of the brand in the customer’s mind. Such a statement provides guidance and direction for marketing strategies while serving as a standard for considering what strategies to use and not to use. For example, a client often asks: “Is this advertising on strategy?” What they mean is, does the message fit with the positioning strategy of the brand? 6. Marketing strategies are the master plans for achieving objectives. The strategy is what makes the plan “tick.” The proper strategy with less than effective execution can yield reasonable results but the wrong strategy effectively executed can be a disaster. When developing a marketing strategy, the role and contribution of each component of the mix must be identified. When developing a marketing communications strategy, the role and contribution of each component must also be identified. Plans must be integrated in a manner such that a unified message is delivered to the intended target audience. .
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7. Marketing strategy outlines how the various components of the marketing mix will be utilized and identifies the extent of resources that will be allocated to each component. Marketing execution refers to the specific program details that stem directly from the strategy section of the plan. It identifies the activity, the timing, and cost. 8. Marketing control is the process of measuring and evaluating the results of marketing strategies and taking corrective action to ensure that objectives are achieved. Plans are evaluated while in progress in order to identify appropriate changes in direction, if and when necessary. 9. In a creative plan the essential decisions involve what to say and how to say it. On the issue of what to say, the manager decides upon what product claims will take precedence. How to say it is more complex. What appeal techniques will be employed? What will the theme of the message be? In a media plan, what is the best mix of marketing communications? There are a variety of options to choose from and decisions are often based on the advertiser’s knowledge of the target audience’s behaviour and on the budget. 10. The various components of a marketing communications plan are directly linked to each other. A manager selects the appropriate forms of communication to resolve the situation at hand. From that point on he or she must ensure that the strategic direction of each option are synchronized with the other options so that a unified message is delivered. A unified approach has more impact on the target market. That is the premise upon which integrated marketing communication strategies are designed. Discussion Questions 1. Communications objectives are diverse but a good campaign must have specific focus. This statement is true but students may have varying opinions. Opinions vary because students do not yet appreciate the role of marketing strategy and marketing communications strategy. The implementation of plans that go off indifferent directions tends to confuse the target audience. Further, plans that attempt to deal with too many issues (or objectives) at one time become very complex. Complex messages do not break through the clutter and again create confusion in the customer’s mind. 2. Students’ opinions on this question will vary. For example, if Roots stays focused on the youth market segment it will constantly be in the business of attracting new customers. To grow, it must expand out of its niche and make the banner appealing to older age groups as well. New marketing and marketing communications strategies are needed. Encourage the students to offer specific recommendations for the future. a. Tim Hortons is one of Canada’s most successful companies. Strong marketing programs have always played a key role in the growth and development of the company. However, Tim Hortons operates in market where there is much competitor overlap (e.g., burger restaurants competing with chicken restaurants, competing with pizza restaurants, and so on). Menu duplication is prevalent. To stay in front Tim’s must continue to bring innovative products to market, find ways of serving people more quickly and maintain prices at reasonable levels so as to keep the value equation in check. Effective marketing communications have always been strength of the company. One positioning strategy statement is “Always fresh” communicating that their products are never standing, but always moving (being sold). Tim Hortons is an expert at building image with emotional advertising campaigns and a master at building loyalty through sales promotion .
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programs. Given the level of competition, fresh approaches to marketing communications may be needed. 3. The intent of this question is to get students sourcing appropriate secondary market information that is typically included in the background section of a marketing plan. Once the information is collected the student should make some observations and conclusions that would have impact on the direction to take in a marketing plan, including marketing communications. 4. Responses will vary based on the product leader and challenger chosen by the student. The intent is to evaluate the marketing communications mix employed by each brand. Are there any differences that may have an impact on brand performance? 5. Working in reverse, the idea here is to generate the prototypical target market profile based on the imagery and message communicated in the marketing communication mix. Since the product is an automobile all key elements of a profile (demographic, behavioural, psychographic and geographic) will play a role.
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Chapter 3 Branding Strategy Learning Objectives Students will be able to:
Describe the concept of branding and the role it plays in marketing communications and other business-building programs
Identify the various components of a brand
Describe the benefits of branding for organizations and consumers
Characterize the various stages of brand loyalty
Describe the role and importance of brand positioning and its relationship to marketing communications plans
Explain various brand positioning strategies commonly used in marketing communications
Describe the role and influence of packaging and product design in the brand building process
Chapter Highlights Messages that are designed to create awareness and interest in a product are sent to customers from a variety of touch points (packaging, personal selling, events, promotions, publicity, etc.). The goal is to ultimately get the customer to buy! The potential impact of the message is largely based on what the brand has to offer. What are its unique selling points and how is it differentiated from competing brands? A sound brand strategy is the foundation that ultimately positions a brand in the minds of consumers. A. Defining the Brand A brand is an identifying mark, symbol, word(s), or combination of same, that separates one company’s product from another. A brand is also defined as a combination of tangible and intangible characteristics that combine to have an impact on customers. A brand may identify one item, a family of items, or all items of that seller. Some key components of a brand include:
Brand Name – A name, term or symbol that identifies and differentiates one product from another.
Brand Name – The part of a brand that can be spoken (i.e., Nike).
Symbol or Brand Logo – The symbol or design element of a brand (i.e., the Nike swoosh).
Design – The design of the product itself, the packaging or colour scheme employed by the manufacturer (i.e., Coke brand uses red while PepsiCo uses blue).
Trademark – That part of a brand granted legal protection so that only the owner can use it. This is identified by TM. Note encircled r is used to identify registered trademarks. .
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Brands are more than just the tangible product. Emotional or intangible entities are added to give a brand a personality and the desired personality is personified in marketing communications programs. For example, brands of beer like Blue, Blue Light and Budweiser all have distinctive personalities that prospective drinkers identify with. When something unique stands out in the customer’s mind, favourable decisions are made. B. Brand Image and Reputation Marketing communications play a key role in building a brand’s image and reputation. A good reputation does not just happen – it is the result of a consistent approach in marketing communications over an extended period of time. Canadian Tire is an example of a Canadian brand with a solid reputation that has withstood incredible competitive pressures from big American retailers like Walmart and Home Depot. A list of top brands by reputation in Canada is shown in Figure 3.3. C. Brand Loyalty Brand loyalty refers to the degree of consumer attachment to a particular brand. It is influenced by the quality of marketing communications programs. Perceptions of loyalty are influenced by product or service experience, marketing communication such as advertising, peer or family pressure and by salesperson or customer service interaction. Brand loyalty is measured in three stages:
Brand Recognition – Through communications consumers become aware of a brand.
Brand Preference – The brand is assessed and becomes an acceptable alternative in the customer’s mind.
Brand Insistence – The consumer buys the brand and searches for it exclusively when needed again.
Consumers in the brand insistence stage often become brand advocates. They are so convinced it is the best brand they openly and consistently recommend it to others. This phenomenon shows how word-ofmouth communications can be a powerful tool in building a brand and its image. For more insight into brand loyalty, review IMC Highlight Brand Loyalty: It’s the Emotional Connection That Counts. D. Brand Equity Brand equity refers to the value of a brand in a holistic sense to its owners as a corporate asset. For our purposes, brand equity is defined as the value a consumer derives from a brand over and above the value derived from physical attributes. The value of the asset is determined by effective marketing and marketing communications over an extended period and is influenced by several variables: brand name awareness; the degree of loyalty expressed by customers; perceived quality; and the brand’s association with a certain attribute. Coca-Cola is consistently ranked as the leading global brand in terms do value. The top brands that rated high based on equity include Tim Hortons, Canadian Tire, CBC, and Air Canada., Brand equity can also be defined in financial terms, as an asset. Using this criteria, the top five Canadian brand leaders are Royal Bank, TD Canada Trust, Bell, Scotia Bank, and Bank of Montreal (see Figure 3.6). E. The Benefits of Branding For consumers the benefits are: .
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The brand represents a certain level of quality (trust in the brand grows with time) There are psychological rewards for possessing certain brands (prestige, status, etc.). Brands distinguish competitive offerings
Consumers want facts about brand claims and they want brands to be environmentally friendly. Marketing communications play a key role in providing these facts and in distinguishing one brand from another.
A good brand name: communicates the unique selling point; that is, it’s differential advantage. Branding allows for the creation of an image. Consistent quality builds brand loyalty among customers
In automobile marketing branding plays a key role as it influences consumer perceptions and builds consumer trust in the brand. For example, Japanese brands are generally perceived to be of higher quality than domestic brands. Trust is also a consideration when it comes to brands. Today’s best brands are using marketing communications strategically to position themselves as the most trust worthy organizations in their industries. See Figure 3.8 for a list of trusted Canadian brands in various product categories. F. Building the Brand Brand managers are responsible for building their brands: brand image and brand equity. The process of brand building involves four steps: 1. 2. 3. 4.
Identifying and establishing brand core values and positioning strategy Planning and implementing marketing programs Measuring and interpreting brand performance Growing and sustaining brand equity (managing the brand)
Core values are the primary attributes and benefits a brand delivers to the customer. An attribute is a descriptive feature whereas a benefit is the value a consumer attaches to the brand attribute. To illustrate, Dove (based on its latest marketing communications campaign) stands for self-esteem and communicates that women should celebrate themselves as they are. Dove is marketing a self- esteem attitude more so than the product. G. Brand Positioning Concepts Positioning refers to the selling concept that motivates purchase, or the image that marketers desire a brand to have in the minds of consumers. Marketing communications is responsible for creating the appropriate appeals to make a product standout from the competition in the minds of the target market. Most marketing and marketing communications strategies stem from a precisely worded positioning strategy statement. Brands position themselves on dimensions that are important to consumers, and may focus in on single or multi-benefits of their product or service. The positioning strategy statement is a key part of the marketing communications strategy and gives a compelling reason why potential customers should buy the brand. It should be written in a clear, concise and uncomplicated manner. Some of the more common means of positioning a brand through marketing communications are as follows:
Product Differentiation – The brand communicates meaningful and valued differences in order to distinguish itself. For example, Glad (wraps and bags) seal in freshness. BAND-AID competes with
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many other brands and differentiates itself based on its unique attributes of super-stick adhesive and that it will stay on longer even in the toughest conditions.
Brand Leadership – Brands that are leaders tell their story. They portray leadership in what they say and how they say it. Coca-Cola is a brand leader. Phrases like “Always Coca-Cola”, “Can’t Beat The Real Thing” or “Open Happiness” portray the brand’s positioning strategy. Brand leaders have characteristics in common, often this includes greater consumer awareness and recall and higher marketing spend.
Head-On – A brand is presented as an equal or better alternative, usually through some form of comparison. This strategy is common among household cleaning products. Two leading brands are compared on an important benefit with the advertised brand showing better results. The “Pepsi Challenge” is the classic example.
Innovation – A strategy that dwells on technical leadership, research and development programs, and a desire to be perceived as new and leading edge in a market. For example, the Apple iPod changed the way we listen to music.
Price (Value) – A strategy based on the premise that consumers search for the best possible value given their economic circumstances. Wal-Mart has a lock on the low price and good value strategy with a lot of people. The phrase “We sell for less. Everyday.” adequately summarizes its positioning strategy, and the newer slogan “Save Money, Live Better”, continue to stress low prices but also focus on how their products and services offer consumers improvements to their lifestyle.
Image (Lifestyle) – Focusing on the intangible characteristics in order to build a desired image or personality. The brand portrays itself in a manner that it is a good fit with the lifestyle of the target market. Beer, alcohol, fragrance, automobiles and travel frequently use this strategy.
Repositioning – Changing the place a product occupies in the consumer’s mind relative to the competition. Changes in environmental factors can affect consumer preferences, leading manufacturers to reposition. . H. Planning and Implementing Marketing Communications Programs A brand must be presented to customers with a unified voice. Therefore, all forms of marketing communications must work from a common base of information and have similar objectives to achieve. Several steps are important in building the communications program:
Employ Various Brand Elements Effectively – What role will name, logos, symbols, slogans, packaging and characters play in the communications? There must be a consistent presentation of all relevant brand elements across all media.
Marketing Communications is the Voice of the Brand – Regardless of the medium selected, the brand message must be delivered with clarity and continuity. Proper execution with adequate financial support should result in the desired image being planted in the customer’s mind. For example, Molson Canadian, now partly owned by the American company Coors, changed its slogan to “Made from Canada”
Use the Communications Tools Properly – There are various elements in the communications mix with each capable of performing certain roles better than others. For example, advertising is good at .
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creating awareness and interest; sales promotions; experiential marketing; and public relations are good at creating desire and action. Social media create new avenues for communicating with the customer. Selecting the appropriate medium, or mix of media for the situation at hand is crucial. For some insight into brand building strategies, see IMC Highlight (page 84) ING Bank Becomes Tangerine. When Scotiabank acquired the successful ING Direct, a legal requirement of the transition was to provide a new brand name. I. Packaging and Brand Building The “look” of a package plays a role in building a brand’s image. Over time, consumers start to associate the colour of a package with the brand so they know exactly what they are looking for. For example, there is Sunlight (yellow), Tide (orange), Kodak (orange), UPS (brown) and Coca-Cola (red). Many brands have made efforts to “own” a colour. Since a majority of purchase decisions are being made at point-of-sale, marketers are placing a higher priority on packaging. The package itself is a very important selling medium. The role of a package is to:
Protect the Product – Products move through numerous hands on the way to their final destination. The product must arrive in A1 condition.
Market the Product – The package does the same thing as an advertisement. Therefore, if it is to attract the eye of passers by, it must have an attractive and coordinated appearance. Copy on the package should also communicate essential information that will help motivate purchase. Sometimes a change in package style and design can rejuvenate interest in a brand. As an example, Colgate’s package clearly communicates the key benefit of: “repair enamel damage”, see Figure 3.19.
Provide Convenience – A package should be easy to carry, open, handle, and reseal. Innovation in design helps in this area. For example, no drip spouts on cleaning products, handles on bulky items, and metal tins with molded metal bottoms that allow for stacking, add value to a product.
Be Environmentally Friendly- Wasteful packaging or packing disrespectful to the environment can be a turn off for consumers. For example, PepsiCo introduced a bottle made of plant material.
J. Branding by Design For products that don’t come in a package it is the design of the product itself that has an impact on consumers. Brands like Samsung are perceived as sleek and stylish (see Figure 3.23). Today companies are making efforts to integrate the brand experience into the product or service. Technology has significant influence on design. To illustrate, simply consider the evolution of televisions in the past ten years. Ugly black boxes have been replaced with sexy, flat plasma screens. Changing the identity of a brand has its perils. Should a company change its name or logo, for example, an intensive marketing communications program must be planned and implemented to make all public aware of the change. All consumer touch points must communicate the new name and image.
Answers to End of Chapter Questions
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Review Questions 1. The key components of a brand are the brand name, brandmark (logo), the trademark, and the package itself (e.g., an outer package that carries the product or the design of the product if it is not contained in a package). 2. Some benefits of branding for consumers include: a brand offers a certain level of quality on a continuous basis; a brand offers psychological rewards through ownership of it; and a brand distinguishes one product from another in the customer’s mind. For an organization the benefits include: a brand communicates the differential advantage; a brand allows for the creation of an image or personality; and a brand that consistently meets customer expectations is rewarded in terms of brand loyalty. 3. The three stages of brand loyalty are: brand recognition (initial awareness created by marketing communications); brand preference (the brand is in the customer’s frame of reference and is perceived as useful); and brand insistence (consumers search exclusively for a particular brand). 4. Brand equity is the value of a brand in term of dollars. It is an asset that the company owns. A brand like Coca-Cola has incredibly high brand equity due to its popularity on a global scale. 5. Core values are the primary attributes and benefits a brand delivers the customer. An attribute is a descriptive feature whereas the benefit is the value customers attach to the feature. 6. Positioning is the selling concept that motivates purchase or the image that marketers desire a brand to have in the minds of customers. It is important for a brand to have a clearly worded positioning statement since all marketing and marketing communications are developed based on that statement. All strategies are evaluated against the positioning strategy statement for “fit” before they are implemented. The statement provides a compelling reason for customers to buy the product. 7. Head-on positioning refers to a situation where one brand compares itself to another in order to show its superiority on an important attribute or benefit. Brand leadership positioning involves making statements that demonstrate or confirm a brand’s position or popularity in the marketplace. A brand like Coca-Cola or McDonald’s can use this strategy effectively since they are dominant leaders in their respective categories. 8. If a product differentiation strategy is followed, the advertising messages will focus on the core attribute and how it will benefit the customer. Maytag, for example, focuses on dependability. Volvo focuses on safety. Ford trucks focus on the “toughness” of the vehicle. Ford trucks are “Built tough.” 9. If a lifestyle positioning strategy is followed the message will focus on intangible characteristics that are associated with the product. For example, the prestige and status that comes with ownership of a Rolex watch or a BMW automobile. Product quality is a given in these situations; it is the lifestyle associations that attract people to buy these kinds of brands. 10. A lot of decisions are made at the point-of-sale so the package itself plays a significant role in the communicating a brand image. Essentially, a package performs three functions: it protects the product during the handling and transportation process; it markets the product by providing useful information that will help motivate purchase; and it provides convenience in purchase and use. .
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11. Product design has considerable influence. For example, consumers look for products that will “fit” their lifestyle or the décor of their homes. The purchase of expensive durable goods such as kitchen appliances, electronics products, and automobiles are closely linked to how people perceive and react to the design of the product. Apple showed the importance of product design when it launched the iMac line of computers. Imagine round shaped computers in a variety of colours. Apple’s unique designs were a sharp contrast to all other brands. Their strategy worked! Discussion and Application Questions 1. A brand is much more than the physical product. A brand is a collection of tangible and intangible characteristics that combine to have influence on potential buyers. Students should link their knowledge of branding with consumer behaviour concepts to show what a brand really stands for. Since so many decisions are based on emotions, it is the intangible characteristics that often dominate the decision-making process among consumers. 2. Everything starts with a name. There are good brand names and some not so good brand names. The Die Hard (a brand of batteries sold at Sears), for example, strongly suggests what the product offers. In the automobile industry, many believe the car is a mechanical extension of the driver’s personality. What kind of male drives a Mustang? What kind of person drives a BMW sports car? Some names are associated with futility. The Edsel is a classic failure. More recently the Pontiac Aztec failed. People didn’t like the name or the concept—a crossover vehicle that wasn’t quite a car or a truck. Student responses to this issue will be based on the research information they uncover. 3. For this question it may be wise to assign product categories or brands to ensure a cross-section of campaigns. Students could briefly present their findings in class. There is no shortage of lifestyle campaigns available for discussion. 4. It is important for students to see the relationship between brand positioning and marketing communications strategy. One way to dramatize the role and importance of positioning is to place it in the center of a circle and have all marketing communications surround it. Link everything together with arrows. The positioning strategy statement is the foundation upon which communications plans are devised. 5. Students will have different opinions about the various companies and how they are positioned so only a few insights will be provided here. Ask students to examine the brand’s marketing communications in order to determine the positioning strategy for that brand. 6. The purpose of this question is to get students examining the role that brand names, logos and slogans play in marketing communications. For all intents and purposes it is the logo and slogan that most people remember. The combination must plant an image or message in the customer’s mind. 7. Responses will vary based on the packages selected by the students. A good package meets the various criteria mentioned in the chapter.
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Chapter 4 Advertising Planning: Creative Learning Objectives Students will be able to:
Identify the basic elements of the communications process
Explain the various stages of creative planning
Explain the role of the creative brief and describe the content of such a document
Distinguish between creative objectives, creative strategies, and creative execution
Describe the role of creative objective statements
Appreciate the variety of appeal techniques for developing creative strategies
Identify various execution techniques for best presenting creative strategies
Chapter Highlights This chapter focuses on one aspect of advertising planning, that being the development and implementation of the message. A. Communications Essentials Figure 4.1 presents an overview of the communications process. The basic elements (sender, encoding by media, competitive noise, decoding by the receiver, and feedback) should be firmly understood by students. Understanding the processing that goes on in the consumer’s mind helps with the development of an advertising message. Essentially, a consumer passes through a series of stages. One such model of the stages is ACCA: awareness, comprehension, conviction, and action. This model is part of a theory called DAGMAR: Defining Advertising Goals for Measured Advertising Response. The effectiveness of a commercial or campaign is usually linked back to this model since research is conducted to measure levels of awareness and interest a consumer has in an advertised brand. A description of each behavioural stage follows:
Awareness – Learning about the product (through advertising or some other form of marketing communications). Awareness can be measured using recall tests.
Comprehension – Interest is created (the product is judged to be useful). The product is in the consumer’s cognitive realm. Attitude towards a product can measure comprehension of how the product satisfies the customer’s needs.
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