Analysis of Marketing Communication - Assignment Example

Analysis of Marketing Communication Contents Analysis of Marketing Communication 1 Contents 1 Abstract 2 Introduction 2 Literature Review 4 Database Driven Model of IMC 7 Relationship Model 9 Model Conceptualization 11 PEPSI 15 PepsiCo: 15 Pepsi's Marketing Communication Activities: 15 Analysis 17 Recommendations 18 BIBLIOGRAPHY 20 Abstract Marketing Communication in today’s changing market is a challenging task. Newer mediums, concepts and tools have emerged that makes the decision for an effective marketing communication message a hideous task. In this paper we will look at how marketing communication is carried out in today’s world with the emergence of Integrated Marketing Communication concept. We will study models that are in place of IMC and develop a model that fills the gap between this newer customer oriented and traditional organization oriented marketing communication strategy. Introduction Marketing Communications is a way to inform, persuade, incite and remind customers, directly or indirectly about your brand. (Kevin Lane Keller, 2001) A lot of people perceive the Marketing Communication is only about advertising. Although advertising is a major part of the communication mix, we cannot consider it the only tool. (Rossiter & Bellman, 2005) The Marketing Communication Mix, sometimes known as Promotional Mix consists of the following tools: 1- Advertising 2- Sales Promotion 3- Personal Selling 4- Product Publicity These tools are further subdivided. But the real objective of Marketing communication is to what to say, how to say, who to communicate to, which medium to use and how frequently should you communicate. (Philip J. Kitchen, 1999) Marketing Communication has grown exponentially since 1950s and this growth accounts for the massive growth in marketing itself. (Kotler, 1997; Cohen, 1991) As a result of this growth, marketers face greater challenges in designing, implementing and evaluating marketing communication programs. (Kevin Lane Keller, 2001) These challenges are faced by the marketers’ everyday due to the increase in number and diversity of communication mediums. Initially there were only mediums such as Traditional advertising and Personal selling tools. Now there has been a fragmentation of traditional media advertising and new mediums and communication alternatives are emerging every day. Earlier marketers only focused on designing a communication program for their target market and launched it on the few available mediums. Today’s marketer has to evaluate which medium(s) shall be used to communicate the message effectively to their target market. With this need, the concept of Integrated Marketing Communication (IMC) emerged. Literature Review The concept of IMC emerged in the early 1990s and its importance is growing ever since. (Grove, Carlson, and Dorsch, 2002; Kitchen, Brignell, Li, and Jones, 2004) IMC helps to create a coordinated and consistent message, and communicate it effectively through different channels of communication to your target audience. The marketers now use a mix of different tools and mediums in order to communicate their message. (Kitchen and Burgmann, 2010) In any organization, the intangible assets provide the most sustainable competitive advantage to the company because it accounts for the brand equity. IMC integrates the tangible and intangible assets and expense combinations to increase the strategic capabilities of an organization. It combines and converts both tangible and intangible inputs into outputs. (Ratnatimga and Ewing, 2005) IMC enables marketers to plan a coherent, consistent and synergetic approach towards marketing communication and thus communicate a consistent message across all channels. It also helps to leverage the newer communication channels such as direct marketing, internet marketing or different types of sales promotion and incorporate them into marketing strategy and corporate branding. (McGrath, 2005) With the help of technology, integration of all communication messages is possible. Many organizations have already adopted IMC for example FedEx and Dell. (Kitchen and Burgmann, 2010) No doubt, IMC is an increasing trend and popular concept in organizations. But the conceptualization and measurement issue of IMC still needs to be resolved. Despite the awareness and popularity of the concept, there is little research done on the topic. It is very important to know the impact of IMC on our everyday marketing communication practices. Even though there are some researches and studies conducted on the impact of IMC on marketing communications, there are major discrepancies in the results. The findings of these studies are inconsistent, contradictory to each other and inconclusive. (Hwan and Wook, 2007) The main reason for this confusion is that different researches adopted different conceptualizations (definitions) of IMC which led to using different measures in the studies. (Caywood, Schultz, and Wang, 1991) The marketers and researchers haven’t simply moved from concept to practical application. (Cook, 2004) In early 1990s integrated referred to ‘coordinated’ marketing efforts, later on it referred to ‘harmonious’ activities. In Mid 2000s, another dimension added to the integrated Marketing Communication-‘holistic’ and ‘Completeness’. Therefore IMC is evolving from day to day and with its evolution, the scope of the subject is changing. For this reason there is no single conceptual footing for the IMC. Marketers have still not agreed to a single definition of IMC. Different researchers and marketers provide different definitions of the concept. For practical implications of the concept and evaluating its impact on marketing communication, it is very vital to define it and develop measures for assessing the impact. According to Cook, there is slow progress in coming to a common conceptualization. There are two reasons for this. Firstly, the domain of and practice of IMC is multifaceted and diverse. It is hard to construct a common conceptual basis of IMC. Secondly, as mentioned earlier, IMC is still evolving. With every research and study there are newer concepts adding to IMC. In order to review the different models of Integrated Marketing Communications, we will go with a the definition of IMC as “the coordination and integration of all marketing communication tools, avenues, functions and sources within a company into a seamless program that maximizes the impact on consumers and other end users at a minimal cost” (Kenneth and Donald, 2007) One of the greatest challenges in IMC is to effectively integrate various elements of marketing communications mix. The synergy across these elements is extremely important. Spending on one source may enhance the effectiveness of another. (Gopalakrishna and Rabikar, 1992) Database Driven Model of IMC With the evolution of IMC, focus from mass marketing has been switched to target marketing. (Schultz, 1999). Marketers have to cater to different segments and thus have to understand their individual needs. For this reason, companies have recently been focusing largely on customer relationship management. Customer data is essential in strategizing for communication programs. Unfortunately, mostly organizations lack accurate and relevant data from customers in order to create effective communication plans. (Deighton & Glazer 1998). For organizations to collect ‘smart’ data and thus design ‘smart’ campaigns, they have to collect data on individual level. This data can obtain with the help of recent electronic technology. (Glazer 1999). For this reason we can see a Database driven model for IMC in Figure 1. Figure 1: A conceptual model to derive the relationship between database management and interactive IMC In this model database driven CRM systems are used to collect data from customers and use them to create effective marketing communication programs. As it can be seen from the figure 1, IMC relies on CRM databases for collecting, analysing and using customer data. (Peltier, Schibrowsky and Schultz, 2003) The model specifically includes feedback/response from customers. It is important to note that while developing any communication strategy, it is crucial to know the customer insights generated from feedback and response. The model shows data collection process that involves traditional and newer data collection techniques. Then there is a database development process where marketers segment in the consumers on the basis of demographics, psychographics and behavioural aspects. Furthermore, CRM software does profiling of customers and brings together data from different sources of each customer at one point. From the IMC’s side, they develop the strategy in which they design specific customized communication programs. After execution of these campaigns, the customer response is gathered. This response again gives insight about consumer behaviour and their preferences. Relationship Model IMC has moved the organizational strategies from product driven to customer driven. The focus is not more the 4 Ps; it’s more of 4 Cs. From Product to Consumer; Price to Cost; Place to Convenience and Promotion to Communication; the entire framework of IMC is largely focused on Consumers. Previously the marketing messages were made considering only the sender side. Many researchers including Mick (1992), Scott(1994) and Stem (1996) have emphasized on the need to focus on the consumer. Instead of the traditional marketing communication concept where focus was in the sender, one should focus on the receiver side and the meaning that receiver creates from your message. (Finne and Grönroos, 2009) In this model, Finne and Grönroos developed a marketing communication framework that included historical, future, internal and external factors as an integral part of customers’ meaning creation. These are different factors that influence consumers’ meaning of communication processes This model emphasizes on the idea of relationship communication that is according to Finne and Grönroos “any type of marketing communication that influences the receiver’s long-term commitment to the sender by facilitating meaning creation through integration with the receiver’s time and situational context. The time context refers to the receiver’s perception of the history and envisioned future of his/her relationship with the sender. The situational context refers to other elements internal or external to the receiver.” (Finne and Grönroos, 2009) Built on the Mick and Buhl’s ‘the Meaning-Based Model’ and Edvardsson and Strandvik’s ‘the CIRC Model’, Relationship Model as shown in Figure 2 has both time and situational dimensions. This model helps in taking into account different factors that impact integrated marketing communication from a customer’s perspective. Figure 2 Model Conceptualization Integrated Marketing Communication as mentioned earlier involves consistency and coherence in communication messages. In the literature, we saw two different models that help in IMC. One was a conceptual model of Relationship Communication (Finne and Grönroos, 2009). The other one being on the technical side, used technology for effective IMC in Database Driven Model. We know that building relationships with customers is today’s marketer’s main objective. Literature shows that there should be less focus on functionalism and products but more focus on people, building relationship with them and understanding the meaning that you give to your customers. (Duncan and Moriarty, 1998) Building stronger relationships with profitable customers and gaining new ones is what marketers are always looking for. For this reason we have created a model that integrates the customer relationship aspect from both CRM and Marketing Communication perspective. The relationship based model only tells the customer side of story. It does not tell how to understand the situational and time factors that create different meanings for the product in customers. This model explains the perspectives of Organization as well as the customer. How information flows from customers to the organization and how it flows from the organization to customers. The interaction between both customer and organization results into an integrated marketing communication message. The interactivity part between customer and organization can be in the form of communication messages. These communication messages are delivered through communication mix and promotional mix. The 4 Ps of price, product, placement and promotion interact with the customer. Furthermore, in this model, the customer also gives feedback to the organization. This response/feedback is used to analyse the consumer behaviour and from this analysis, marketers devise marketing communication strategy. PEPSI This leading soft drink brand started back in 1898 when a pharmacist Caleb Bradham in hot summer days came up with a new drink while combining juices and syrups to serve his customers. Today this drink is known as Pepsi. In year 1902 he launched his company in back room of his pharmacy and that’s how a proper business was started. Back then, its name was Pepsi Cola, which was later changed in 1960’s to Pepsi. PepsiCo: PepsiCo started in 1965 when Pepsi-Cola and Frito-Lay combined to form one new company, which is PepsiCo. PepsiCo is one of the most widely known companies and it offers hundreds of products all over the world. It is considered as world’s fourth largest company in category of food and beverages. Pepsi's Marketing Communication Activities: Throughout the history of Pepsi until day, Pepsi has used innovative and attractive marketing communication strategies to attract customers and to promote their drinks. Since beginning, they have target people of all ages but their core focus has always been young generation. They use inspirational and enthusiastic themes as their prime idea in their ads. They link their products with seasons, festivals and current worldly affairs like cricket world cup and FIFA etc. Back in start Pepsi also came up with excellent marketing slogans such as “cost small, liked by all, bottle tall” with comic cartoons. In World War II, Pepsi Ads were patriotic and enthusiastic and illustrated using skywriting “hello navy”. They even came up with a jingle “twice as much for a nickel” which was the first advertising jingle in marketing of any product. Pepsi Generation is the unique concept of advertising, which became an instant hit all around the world. Pepsi generation advertised famous celebrities such as Britney spears, Michael Jackson and Beyoncé. Today the famous tagline of Pepsi is “ask for more”. Pepsi has always given importance to their packaging in advertisements. They keep coming up with new designs for their bottles and cans. (PepsiCo. 2005) Pepsi has used interesting ads for all of the varieties they offer such as Pepsi Diet, Pepsi Twist, Pepsi Max, Pepsi Blue and Pepsi Jazz. They have done themes like Pepsi light, dare for more, Pepsi mini cans, and Pepsi straws. Pepsi has also done some of vintage and retro pinup illustrations for their ads. Pepsi always communicate an integrated message to its customers via broadcast media, print media, social networks, BTL activities, sales promotion and publicity. They come up with innovative campaigns, have enhanced distribution mechanism and focus on their consumers for their marketing communication. Analysis The proposed model can be implemented in PepsiCo. easily. The marketers should implement CRM software’s to take information from the customers. Taking information from customers can be through feedback, their response towards the communication messages and their interaction amongst their peers (through social media). The information can be obtained through traditional and modern research methods both. Nowadays with the advent of social networks, it has become easier to know the customers better. Brands are gathering consumer insights from their fanpages, wallposts of their customers, tweets and blogs etc. Without a proper CRM system in place that keeps records of what information is taken by which customer, good analysis of customer data is close to impossible. From this information, they create profiles of the customers. These profiles will be recorded in the databases and Pepsi will be able to understand the different characteristics of customers. This information shall be used to see what situational and time factors create meanings amongst their consumers. After analysing the data, proper Marketing Communication plan shall be implemented. The insight gathered with the help of CRM system can tell the marketers more about their consumers. With the help of this insight, they can easily create targeted communication strategies so that their customers always feel special. The 360 degree marketing communication plan that Pepsi will have will involve a single Big idea that will be communicated through various channels to give out a consistent message so that the consumers can derive a consistent meaning out of it. The mediums used will be Broadcast, print, social media and BTL activities. This model tells us how interactivity between customers and the company can help the organization in formulating a consistent message and how when this message is communicated across different channels, customers can also derive a single meaning out of these different mediums used. Recommendations Marketing Communication is the crux of marketing as a whole. The aim of every marketer is to create messages that will help them retain old customers and attract newer customers. With the emergence of Integrated Marketing Communication, this task has become more challenging, yet marketers who have adopted this technique are satisfying their customers more as compared to those who haven’t. An approach that looks at both the customer and the organization perspective is suitable for an effective integrated marketing communication technique. This is because in the end it’s the relationship between customer and the organization. From the discussion we have learned that it’s not only about creating a consistent message, it’s about giving a consistent meaning to the customer. This is because you cannot tell whether your customers are deriving a consistent meaning out of your consistent messages. The art of integrated communication is not only in the messages that you convey, it is also about the mediums you use. Organizations have to analyse which mediums are more popular among their target market and thus whether they can reach their customers through these mediums. With so many different mediums in place, it is not necessary to use all of those. What is important is to see which medium suits you in delivering your consistent message to your target audience. BIBLIOGRAPHY Caywood, C; Schultz, D.E and Wang, P., 1991. Integrated Marketing Communications: A Survey of National Consumer Goods Advertisers , Evanston, IL, 1991.. Northwestern University Report, Evanston. Cohen, W.A., 1991. The Practice of Marketing Management. 2nd ed. Basingston: Macmillan Cook, W.A, 2004. IMC’s Fuzzy Picture: Breakthrough or Breakdown?. Journal of Advertising Research, 44(1), 1-2 Deighton, J. and Glazer, R., 1994. From the editors. Journal of Interactive Marketing, 12 (1), 2-4. Duncan, T. & Moriarty, S.E ., 1998. A Communication-Based iVIarketing iViodei for iVianaging Reiationships. Journal of Marketing, 62, 1-13. 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