MARKETING COMMUNICATION 2
BASIC INFORMATION
Ing. Kateřina Matušínská, Ph.D.
MARKETING COMMUNICATION 2/NAMK2
IMPORTANCE AND CONCEPTION OF
MARKETING COMMUNICATION
BASIC TERMINOLOGY AND PRINCIPLES
Ing. Kateřina Matušínská, Ph.D.
MARKETING COMMUNICATION 2/NAMK2
LECTURE
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
OUTLINE OF THE LECTURE
1. Basic marketing terminology
2. Marketing communication
3. Objectives of marketing communication
4. Marketing communication process
5. Marketing communication mix
6. Off-line versus on-line marketing communication tools
• B2C – business to customer (consumer market)
• B2B – business to business (industrial market)
• B2C – business to customer
• C2B - customer to business
• C2C – customer to customer
• C2G – customer to government
• B2G – business to government
• B2E – business to employee
• G2C – government to customer
1. BASIC MARKETING TERMINOLOGY
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
• Marketing
• Customer versus consumer
• Segmenting, targeting and positioning
• Customization versus mass customization
• ….
BASIC MARKETING TERMINOLOGY
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
MARKETING MIX („4PS“) VERSUS MARKETING
COMMUNICATION MIX
Product
Price
Place
Promotion
(Marketing
Communication)
Marketing
mix
Marketing
communication mix
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
MARKETING MIX „4Ps“
• Product – products are solutions to customer´s needs. The
provider needs to make various product decisions, including
functionality, range offered, brand names, packaging, service
and support. It is the critical element in the mix.
• Price – various price-setting models exist, with decisions
relating to factors like market penetration, credit terms,
discount policy and cost of provision.
• Place – it is about making the product available. Some form
of structured network is normally required – a distribution
channel.
• Promotion – promotion aims to make a target market aware
of a product offering, develop a long-term relationship with the
customer and create and stimulate demand.
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
„7PS“ – EXTENDED MARKETING MIX
(IN THE CASE IF THE PRODUCT = SERVICE)
• „4Ps“
• Physical evidence – customers look for reassurance relating
to required benefits and quality (ambience, fixtures and fittings,
appearance/attitude of staff, etc.) as an indicator of likely
satisfaction.
• Process – the method by which the services are provided.
• People – people are an essential element of the marketing
mix. Staff recruitment, training, development and
empowerment to deal with problems become a critical element
in ensuring a positive customer experience.
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
This table indicates approximate relative weights of
„4Ps“ in customer decision-making.
Product Price Place Marketing
communication
B2B 60 % 30 % 5 % 5 %
B2C 5 % 5 % 30 % 60 %
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
MARKETING MIX 4P? X 4C?
4P 4C
SELLER  CUSTOMER CUSTOMER  SELLER
PRODUCT CUSTOMER VALUE
PRICE COST TO THE CUSTOMER
PLACE CONVENIENCE
PROMOTION COMMUNICATION
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
2. MARKETING COMMUNICATION (MC)
• MC involves answering the following questions:
• who is the target audience?
• what should be communicated and?
• how should it be communicated?
• „Marketing smog“ – a negative aspect of contemporary MC!
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
MARKETING COMMUNICATION
• Larger sense: all planned and unplanned communication in
all contacts between company and its present and potential
customers (the product package, brand perception, price,
advertising, staff behaviour, tradition of company, car fleet,
outlets, offices etc.)  Integrated Marketing Communication
• Narrow sense: marketing communication mix
• Marketing communication is an ever-changing field. New
theories, new techniques, cultural changes and technological
advances all combine to create a dynamic environment within
which marketers try to ensure that their messages get through
to their target audiences.
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
OUT-OF-DATE MCIMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
MARKETING COMMUNICATION IN LAST
UP-TO-DATE MCIMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
MARKETING COMMUNICATION TODAY I.
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
MARKETING COMMUNICATION TODAY II.
VIDEO: NIVEA, GUERILLA MARKETING,
VIRAL MARKETING
3. THE GENERAL OBJECTIVES OF MC
• To provide information.
• To create demand.
• To support the product differentiation (positioning).
• To point out the product value and benefit for customers.
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
CHARACTERICS OF MC OBJECTIVES
• SMART
• In accordance with overall corporate and marketing goals.
• Associated with current and desired position of the product and
the brand.
• Quantifiable to be measured.
• Formulated with regard to the views of implementers.
• Understandable and acceptable.
• Accepted as compulsory.
• Motivating.
• Divided into several sectional objectives if necessary.
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
THREE STREAMS OF MC OBJECTIVES
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
SALES STREAM
• Sales volume
• Sales value
• ROI
• Market share
• Profitability
COMMUNICATION
STREAM
• Awareness
• Comprehension
• Perception
• Attitudes
CORPORATE
STREAM
• Performance
• Image
• Reputation
• Preferences
MODEL DAGMAR  DEFINING ADVERTISING GOALS
FOR MEASURED ADVERTISING RESULTS
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
• MODEL DAGMAR (Colley, 1961) – popular in past.
• Typically the communication task is based on sequential model
of the communications process: awareness – comprehension
– conviction – action.
• It was one thought that marketing communications succeeds or
fails depending on how well it communicates the desired
information and attitudes to the right people at the right time and
at the right cost.
• A more contemporary view holds that success should be based
on the degree to which audience (brand)behaviour is influenced
but campaigns designed to develop awareness and establish
brand name familiarity are still necessary. Indeed, many brands
seek to establish top of mind awareness as one of their primary
objectives for their communication (advertising) spend.
DAGMAR
1. AWARENESS
Awareness of the existence of a
product or brand is necessary before
any purchase will be made.
2. COMPREHENSION
Audiences need information
and knowledge about the
product and its specific
attributes. Often the audience
needs to be educated and
shown either how to use the
product or how changes might
affect their use of the product.
3. CONVICTION
By developing beliefs that a product is
superior to others in a category or can
confer particular rewards through use,
audiences can be convinced to trial the
product at the new purchase opportunity.
4. ACTION
Potential buyers need help and
encouragement to transfer
thoughts into behaviour.
Providing call-free numbers,
website addresses, reply cards,
coupons and sales people helps
people act upon their
convictions.
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
4. MARKETING COMMUNICATION PROCESS
• The communication process - an interactive dialogue
between the company and its customers in the stage before
the sale, during the sale, during consumption and after the
consumption of goods and services.
• The general scheme of the communication process (H. D.
Lasswell - Power and Personality, 1948):
• Who says What to Whom through Which channel with
What effect?
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
CYBERNETIC MODEL OF THE COMMUNICATION PROCESS
MESSAGE MEDIA MESSAGE RECEIVERSENDER
Encoding Decoding
Decoding Encoding
Feedback
NOICE
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
PARTS OF COMMUNICATION PROCESS
A. Source of communication
• whoever has the thoughts, intentions, information and
reason for communication
• company, advertising agency, celebrity, …
B. The recipient of communication
• customer, buyer, influencer, opinion leader, …
C. Communication channels (media) - the means by which
communications get from source to recipient
• channels controlled by company - channels are personal
and impersonal (mass)
• channels uncontrolled by company - channels are personal
and impersonal
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
D. Message
• It must be converted to a proper form - encoded (converting
ideas into symbols - drawing, sound, words, facial
expressions) and transferred with means of communication medium.
Then follows which is the interpretation of the
recipient (experiences, needs, interests, attitudes, values,
goals).
• 3 basic conditions - the communication must:
• be attractive
• be understandable
• respond to the needs and wishes of the recipients and bring
a reasonable opportunity to satisfy them
• These three basic requirements are related to the model
AIDA (AIDCA) which captures the steps by which an
individual undergoes during the purchase process.
PARTS OF COMMUNICATION PROCESS
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
MODEL AIDA/AIDCA
A ATTENTION Are you talking to me?
I INTEREST Why are you talking to me?
What do you want me to know?
D DESIRE It is a nice idea but do I really need it?
What do you want me to understand?
C CREDIBILITY How can I be sure that it is a right decision?
Can I trust the offer (brand)?
A ACTION What should I do?
Is it easy for me?
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
TEASING
• The aim is to draw attention of customers in long-term.
• It is a communication divided into parts when the
communication story is gradually revealed.
• The intention is to provoke and support curiosity and desire
what will happen next?
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
HYPERMARKET „CZECH DREAM“
Humorous, provocative and intelligent „shopping reality show“
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
PARTS OF COMMUNICATION PROCESS
E. Communications noise
• misrepresentation of
information
• too much information
• inappropriate form of
communication
transmission
• use of vague and
meaningless words and
phrases
• inability to listen (the level
of listening is about 25 %)
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
Source: Ang, L., Principles of Integrated Marketing
Communications
PARTS OF COMMUNICATION PROCESS
F. Feedback
• The goal is to get the fastest and most accurate feedback to
determine whether the message was well understood and
accepted by the customer.
• The feedback can be best obtained from personal sales, on the
other hand, it is very difficult to evaluate the effects of mass
communication.
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
SUMMARY OF MARKETING COMMUNICATION MODELS
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
• A simple communications model
• One-step communications model
• Two-step communications model with opinion leaders
• Two-step communications model with opinion leaders and
opinion formers
• Multi-step communications model
• Simple web communications model + Advanced web
communications model
Source: PR Smith and Ze Zook, Marketing communications: Integrating offline and online with social media
A SIMPLE COMMUNIATIONS MODEL
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
Source: PR Smith and Ze Zook, Marketing communications: Integrating offline and online with social media
ONE-STEP COMMUNICATIONS MODEL
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
Source: PR Smith and Ze Zook, Marketing communications: Integrating offline and online with social media
TWO-STEP COMMUNICATIONS MODEL WITH OPINION
LEADERS
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
Source: PR Smith and Ze Zook, Marketing communications: Integrating offline and online with social media
TWO-STEP COMMUNICATIONS MODEL WITH OPINION
LEADERS AND OPINION FORMERS
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
Source: PR Smith and Ze Zook, Marketing communications: Integrating offline and online with social media
MULTI-STEP COMMUNICATIONS MODEL
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
Source: PR Smith and Ze Zook, Marketing communications: Integrating offline and online with social media
SIMPLE AND ADVANCED WEB COMMUNICATIONS MODEL
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
Source: PR Smith and Ze Zook, Marketing communications: Integrating offline and online with social media
• Opinion leaders (viral marketing, buzz marketing, Word-of-Mouth) –
individuals who were predisposed to receiving information and then
reprocessing it to influence others. Personal influence is important and
can enrich the communication process. WoM communication is interactive
and bidirectional.
• Negative WOM spreads faster than positive!!!
• Types of WoM:
• Voluntary – free from any external influence, coercion or intent
• Prompted – occurs when organisations convey information to
opinion leaders and formers, with a view to deliberately encouraging
them to forward and share the information with their followers (blogs,
online communities and forums, …)
• Managed – occurs when organisations target, incentivise and reward
opinion leaders for recommending their offerings to their networks of
followers.
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
PERSONAL INFLUENCERS
OPINION LEADERS
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
PERSONAL INFLUENCERS
Source: http://www.intersectionconsulting.com/2009/word-of-mouth-marketing/
• Opinion formers – individuals who are able to exert personal
influence because of their authority, education or status associated
with the object of the communication process. The are
acknowledged and sought out by others to provide information and
advice, but this is because of the formal expertise that opinion
formers are adjudged to have (film critics, doctors, bankers, …).
• Opinion followers – the vast majority of consumers. The message
they receive via the mass media are tempered by the opinions of
the two groups of personal influencers in text above.
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
PERSONAL INFLUENCERS
• Advertising
• Sales promotion
• Personal selling
• Public relations (P.R.)
• Direct marketing
• Sponsorship (new!)
• On-line marketing communication (new!)
5. ELEMENTS OF MCM
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
THE FACTORS INFLUENCING THE ELEMENTS OF MCM
• Product type (ordinary, special, luxury, long-term or short-term
consumption)
• Market character (B2C x B2B)
• Product life cycle (introduction, growth, saturation, decline)
• Company market position and its financial resources (large
x small company)
• Marketing communication strategy
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
MARKETING COMMUNICATION MIX
Element Explanation
Advertising
A paid insertion of a message in a
medium. It is aimed at the mass market.
Sales promotion
Activity designed to give a temporary boost
to sales, such as money-off coupons, free
samples, two-for-the price-of one
promotions, free gifts, piggy-backing with
another product, lottery, multi-packing,
events, roadshow etc.
Personal selling
Face-to-face communications between
buyers and sellers designed to ascertain
and meet customer´s needs on a one-toone
basis. (non-verbal communication!)
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
Public relations
The planned and sustained effort to establish and
maintain goodwill and mutual understanding
between an organisation and its publics (press
conference, annual reports, open door day, social
projects, ecological business, press release,
human relations etc.)
Direct marketing
An interactive system of marketing which uses
one or more advertising media to effect a
measurable response and/or transaction at any
location. It is aimed at the individuals (direct mail,
telephone marketing, commercial e-mails etc.)
Sponsorship Funding of cultural events, sporting events etc. In
exchange for publicity and prestige.
On-line marketing
communication
Web company presentation, social networks etc.
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
MARKETING COMMUNICATION MIX ELEMENTS
• Which is the cheapest?
• Which is the most expensive?
• Which can be best measured?
• Which is based on face-to-face relation?
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
ATL x BTL x TTL
• ATL – above the line (classical media)
• BTL – below the line (unconventional media)
• TTL – ATL + BTL (the most frequent use in practice)
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
BTL ATL
IMC
PUBLIC RELATIONS
DIRECT MARKETING
SALES PROMOTION
ADVERTISEMENT
TV, Press, Radio, Outdoor,
Internet, …
SPONSORSHIP, ON-LINE
MC
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
INTEGRATED MARKETING COMMUNICATIONS (IMC)
• The strategic analysis, choice implementation and control of
all elements of marketing communication which efficiently,
economically and effectively influence transactions between
an organization and its existing and potential customers.
• IMC really comprises all aspects and any interaction points
of planned or unplanned communication between the brand,
service, or corporation and the target audience and is
affected by both inside and outside influences  synergetic
effect!
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
INTEGRATED MARKETING COMMUNICATIONS (IMC)
WHY IMC FAILS?
• Employee gossip
• Word of mouth
• Packaging
• Distribution
• Price
• Delivery drivers
• Dress codes
• Sales tactics
• Management style and
philosophy
• Instore and out of store
displays, …
WHAT DRIVES IMC?
• Research
• Database development
• Use of the Internet
• Employing correct media
tactics
• Building brand-loyal
consumers
• Brand development
• Promotional and media mix
• Projecting a consistent
visual/verbal image, ….
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
NEW MARKETING COMMUNICATION SKILLS REQUIRED
• Analytic pattern skills
• Agile project management
• Experimental curiosity and rigour
• System thinking
• Mashable software fluency
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
Source: PR Smith and Ze Zook, Marketing communications: Integrating offline and online with social media, p. 133
6. OFF-LINE VERSUS ON-LINE MARKETING
COMMUNICATION TOOLS
IMPORTANCE AND CONCEPTION OF MARKETING COMMUNICATION
ON-LINE
Advertising
Sales
promotion
Personal
selling
Public
relations
Direct
marketing
Sponzoring