Chapter 18

AIDA model

Awareness, Interest, Desire, Action

available budget

Marketers forecast their sales and expenses, excluding communication, during the budgeting period. The difference between the forecast sales and expenses plus desired profit is reserved for the communication budget. That is, the communication budget is the money available after operating costs and profits have been budgeted.

Setting and Allocating the IMC Budget

Objective-and-task method Rule-of-thumb methods

Integrated Marketing Communications

Represents the promotion dimension of the six Ps; encompasses a variety of communication disciplines—advertising, personal selling, sales promotion, public relations, direct marketing, and online marketing including social media—in combination to provide clarity, consistency, and maximum communicative impact.

return on marketing investment (ROMI)

The amount of profit divided by the value of the investment. In the case of an advertisement, the ROI is (the sales revenue generated by the ad - the ad's cost) / the ad's cost (gross margin-marketing expenditure / marketing expenditure) x 100

lagged effect

a delayed response to a marketing communication campaign

percentage of sales

communication budget is a fixed percentage of forecasted sales

competitive parity

communication budget is set so that the firms share of communication expenses = its share of the mkt

interest

communication to increase consumers interest level once they are aware of the company or product exists

rule of thumb methods

competitive parity, percentage of sales, available budget

objective-and-task method

determines the budget required to undertake specific tasks to accomplish communication objectives

Measuring Success Using Marketing Metrics

firm decided how to set its budget for mktg communications & its campaigns using various mktg metrics.

desire

firm has piqued the interest of its target mkt, the goal of subsequent IMC messages should move the consumer from i like it to i want it

channels of an IMC strategy

interactive offline: personal selling sales promo direct mktg passive offline: advertising public relations sales promo direct mktg interactive online: direct mktg online mktg passive online: direct mktg

communication process

noise from the environment -> firm -> transmitter encodes message -> communications channel (media) -> receiver (consumer) decodes message -> feedback

awareness

the potential customer comes to know about the product but lacks details

action

ultimate goal of any form of mktg communications is to drive the receiver to action

rule-of-thumb method

use prior sales and communication activities to determine the present communication budget