Lecture fundamentals of marketing - Lecture 21: IMC partners & industry organization

LECTURE­21

IMC Partners & Industry
Organization


Chapter Questions

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


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Who are the IMC partners?
How is the agency world organized?
How do media partners fit in?
Behind the message is the company (client)
How does the agency/client relationship work?


Chapter Perspective: Changing World
Old World

New World

Marketing
Marketing
Communications
Communications
Dominated

Dominated by
by Advertising
Advertising
Agencies
Agencies

More
More Use
Use of
of Other
Other
Marketing
Marketing
Communications
Communications
Functions
Functions

Focus
Focus on
on mass
mass media
media

Willingness
Willingness to
to consider
consider
other
other media

media to
to reach
reach
consumers
consumers


Opening Case: Phelps Group

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Opening Case: Phelps Group
Challenge:

Answer:

Results:

Get
Get feedback
feedback for
for the
the agency’s
agency’s work
work
•• “The
“The Wall”
Wall” of
of ideas

ideas
•• Surveys
Surveys of
of clients,
clients, suppliers,
suppliers, and
and
employees
employees
•• “Wallbangers”
“Wallbangers” and
and “BrainBanger’s
“BrainBanger’s
Balls”
Balls”
•• Recognized
Recognized as
as aa very
very creative
creative
agency
agency
•• Impressive
Impressive client
client list:
list: Petco,
Petco, Whole
Whole
Foods,
Foods, Panasonic

Panasonic


Three Players in the Golden Triangle


IMC in Action: Mall of America


IMC In Action: Mall of America
Challenge:

Answer:

Results:

Promote
Promote Mall
Mall of
of America’s
America’s 10
10thth
anniversary
anniversary
An
An IMC
IMC campaign
campaign featuring:
featuring:
•• The

The theme:
theme: “Celebrating
“Celebrating aa decade
decade of
of
fun”
fun”
•• Effort
Effort to
to involve
involve as
as many
many media
media
partners
partners as
as possible
possible
•• USA
USA Today
Today front
front page
page story
story
•• CBS
CBS Sunday
Sunday Morning
Morning piece
piece
•• AP

AP story
story carried
carried by
by 30
30 newspapers
newspapers


1st Part of Golden Triangle: The Agency


Most Common Types of Agencies
Advertising
Advertising
Advertising
Advertising

Direct
Direct
Direct
Direct
Marketing
Marketing
Marketing
Marketing

Sales
Sales
Promotion
Promotion

Events
Events
Events
Events

Agencies
Agencies
Relationship
Relationship
Relationship
Relationship
Marketing
Marketing
Marketing
Marketing
Public
Public
Public
Public Relations
Relations
Relations
Relations

IMC
IMC
IMC IMC
Packaging
Packaging
Packaging

Packaging


Tales From the Real World

In an attempt to attract new clients, some ad
agencies have jumped on the IMC bandwagon
and now position themselves as “IMC agencies.”
In the real world, it’s important to look deeper:
some of these agencies simply say they can
handle IMC but really don’t have the
organization or experience to adequately
address all the IMC functions


2nd Part of Golden Triangle: The Media


Media Depend on Outside Sources

Advertisers
Advertisers

Content
Content

To
To make
make aa profit
profit

To
To fill
fill time
time and
and space:
space:
•• TV
TV and
and radio:
radio: programming
programming
•• Newspaper:
Newspaper: news
news and
and
features
features


Ultimate form of integration: Disney
Disney
Disney
Store
Store Logo
Logo
Disney
Disney Online
Online
Touchstone
Touchstone

Pictures
Pictures Logo
Logo

Disney
Disney
World
World Logo
Logo

Media
Media
Integration
Integration
@
@ Disney
Disney

Fox
Fox Kids
Kids Logo
Logo

ABC
ABC Logo
Logo
Disney
Disney
Channel
Channel Logo

Logo

ESPN
ESPN Logo
Logo


3rd Part of Golden Triangle: Companies


Two Types of Marketing Efforts

B2B
B2B

B2C
B2C


Some Firms Do Both: Nike
B2B
B2B

Nike’s Relationship with shoe retailers
like Foot Locker
B2C
B2C

Niketown stores selling shoes directly
to consumers

Example of Centralized Control


Example of Decentralized Control

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Agency/Media/Company Compensation

Commission: A payment that
represents a percentage of a
client’s total media spending
Cost of media advertising:
Amount agency bills to client:
Amount agency pays media
Amount agency keeps

Rs. 5 million
(100%)
Rs. 5 million
(100%)
Rs. 4.25 million (85%)
Rs. 750,000
(15%)

Commission = Rs. 750,000

IMC Planning Starts at Zero

Zero-based planning
A process that determines objectives
and strategies
based on current brand
and marketplace
conditions


Tales From the Real World
In the real world, many organizations pay lip
service to “zero-based” planning or ignore it
completely.
Why? It’s human nature. It is simply much easier
and less time consuming to find last year’s plan, dust
it off, make a few minor changes, and present it as a
new plan.
There’s only one problem: last year’s SWOTs may
no longer apply. As a result, the new plan may be
addressing old issues—and wasting marketing
dollars.


Reasons for IMC Planning
Provides
Provides
aa aRational
Rational

Process
Process
Provides
Provides
aRational
Rational
Process
Process
Informs
Informs
Everyone
Everyone
of
of
Informs
Informs
Everyone
Everyone
of
of
Expectations
Expectations
Expectations
Expectations

IMC
IMC
Planning
Planning
Reasons

Reasons

Ensures
Ensures
That
That
the
the
Program
Program
Is
Ensures
Ensures
That
That
the
the
Program
Program
IsIs
Is
Integrated
Integrated Integrated
Integrated
Helps
Identify
Identify
Budget
Budget
HelpsHelps

Helps
Identify
Identify
Budget
Budget
Creates
Creates aa Benchmark
Benchmark for
for
Measuring
Measuring Results
Results


Where it Fits in the Organization
Corporate
Corporate
Level
Level

Department
Department
Level
Level

Business
Business Plan:
Plan:
•• Focused
Focused on

on
the
the profits
profits and
and
brand
brand equity
equity

Department
Department Plan:
Plan:
•• Marketing
Marketing
operations/
operations/
production,
production,
human
human resources
resources

MC
MC Level
Level

IMC
IMC plan:
plan:
•• Advertising,

Advertising,
publicity,
publicity, sales
sales
promotion,
promotion,
events
events and
and
sponsorships,
sponsorships,
direct
direct response
response


Insight: Cross-Functional IMC Teams
Some basic principles for managing
cross-functional teams:
• Long-term focus: Keep team members in place
for an extended period rather than assembling
them for ad hoc projects
• Constant contact: Frequent meetings are
important; however, members can also keep in
constant contact via email
• Work space: Assigning a cross-functional team
its own work space helps keep team members
informed
• Support from the top: Top management must
support the idea of cross-functional planning by

providing adequate resources