Chapter 6: Integrated Marketing Communication (IMC)

Strategy and Management

Strategic Marketing Problems – Kerin & Peterson, 13th Edition

1. What is Marketing Communication?

Definition: Marketing communication is the process by which information about an organization
and its offerings is disseminated to selected markets.
Explanation: Think of it as the "voice" of the company reaching out to customers. Every ad, sales
call, coupon, or website is a way the company "speaks" to its target audience.
Example: When Coca-Cola runs a TV ad showing people enjoying a Coke at a beach party, it is
communicating both the availability of the product and an emotional benefit (refreshment, fun,
togetherness).

2. Goal of Marketing Communication

Two main goals:
1. Induce initial purchase – get a first-time buyer to try the product.
2. Create post-purchase satisfaction – ensure the buyer is happy after using it, so they buy
again and tell others.
Example: A free sample of a new shampoo induces trial (initial purchase). A follow-up email with
hair care tips reinforces satisfaction and encourages repurchase.

3. Purpose of Marketing Communication

Communication informs buyers of three things:
 Availability of the offering – "It exists and you can get it."
 Unique benefits – "Here's why it's better than alternatives."
 Where/how to obtain and use it – practical details on purchase and usage.
Example: An ad for Tesla informs people that (1) the car is now available in their region, (2) it
offers benefits like zero emissions and low running costs, and (3) tells them where to book a test
drive.

4. Marketing Communication Mix

The three traditional tools that make up the communication mix:
Tool Description Example
Advertising Paid, non-personal TV commercial for Pepsi
communication through mass
media
Personal Selling Direct, face-to-face or one-on- A car salesperson explaining
one communication features to a customer
Sales Promotion Short-term incentives to "Buy One Get One Free" offer
encourage purchase at a supermarket

Explanation: These three feed into the overall Communications Mix, which is the total
combination of tools a company uses to reach its audience.

5. Integrated Marketing Communications (IMC)

Definition: The practice of blending different elements of the communication mix in mutually
reinforcing ways.
Explanation: Instead of using advertising, selling, and promotion as separate, disconnected
activities, IMC makes sure they all send a consistent message and support each other.
Example: Apple's iPhone launch uses TV ads (awareness), in-store demonstrations by staff
(personal selling), and limited-time trade-in offers (sales promotion) — all built around the same
theme and timed together for maximum impact.

6. IMC Strategy Framework (6 Key Questions)

When designing an IMC strategy, marketers must answer:
1. What are the information requirements of target markets? – What do customers need to
know before buying?
2. What are the objectives of the strategy? – Awareness? Preference? Purchase?
3. Can some communication activities be combined? – Can advertising and promotion work
together efficiently?
4. What should the budget be and how should resources be allocated? – How much to
spend and where?
5. How should it be timed and scheduled? – When should campaigns run (e.g., seasonal
timing)?
6. How should it be evaluated? – How do we know if it worked?
Example: A university launching a new MBA program would first assess what prospective
students need to know (accreditation, ROI, faculty), set an objective (build awareness in the region),
decide on a mix of digital ads + info sessions, set a budget, schedule around application deadlines,
and later measure enrollment numbers to evaluate success.
7. Information Requirements in Purchase Decisions
A. Purchase Process Model (Hierarchy of Effects)
Buyers typically move through four stages:
Unawareness → Knowledge → Preference → Purchase
Explanation: A person can't buy something they don't know exists. Communication must first
create awareness, then provide knowledge (features/benefits), then build a preference (this brand
over others), and finally push them to purchase.
Example: A consumer sees a Peloton ad for the first time (Unawareness → Knowledge stage),
reads reviews and learns about its features (building Knowledge), starts to prefer it over a regular
gym membership (Preference), and eventually buys it (Purchase).

B. Key Analysis Areas

 Determine how buyers purchase a particular offering – understand the roles played by
individuals in the buying center or household (e.g., who decides, who pays, who uses).
 Example: In a household buying a family car, the husband may research specs, the
wife may decide on safety features, and both jointly make the final decision.
 Define the role of information in the purchase process – understand when, where, how,
and what information is used for decision-making.
 Example: Someone buying a laptop might check YouTube reviews (how), visit a
store to test it (where), a week before a sale (when), and look specifically at battery
life and price (what).
 Determine consumer perceptions of the organization and offering – identify the sources
from which people seek information (word of mouth, ads, online reviews, sales staff, etc.).
 Example: A buyer looking for a plumber may rely more on a neighbor's
recommendation (source: word of mouth) than an advertisement.

8. Reasonable Communication Objectives

Objectives differ depending on the product life-cycle stage:
 Build Primary Demand – demand for the entire product/service category (used in
introduction stage when the product is new).
 Example: Early electric vehicle ads that promote the idea of EVs in general, not a
specific brand.
 Build Selective Demand – demand for a specific brand (used once the category is
established).
 Example: Once EVs are common, Tesla ads now focus on why Tesla specifically is
better than Rivian or Ford.

Requirements for Good Objectives (must be "SMART"-like):

 Consistent – aligned with each other and with other marketing elements (e.g., pricing,
product positioning).
  Quantifiable – measurable, so success can be tracked (e.g., "increase brand awareness by
20%").
 Attainable – realistic given the budget, effort, and timeframe available.
Example: "Increase brand awareness among 18–24-year-olds by 15% within 6 months using a
$50,000 social media budget" is consistent, quantifiable, and attainable — a poorly framed
objective might just say "become more popular," which can't be measured.

9. Developing an IMC Mix — Four Key Factors

A. Information Requirements of Buyers
Different tools serve different roles in the purchase process:
 Advertising → creates awareness
 Salespeople → provide detailed information
 Sales promotion, brochures, catalogs → provide descriptions and stimulate trial
Example: A skincare brand uses Instagram ads to create awareness, in-store beauty consultants to
explain ingredients and suitability, and a "free trial size" promotion to get people to try the product.

B. Nature of the Offering

 Advertising works best when the offering is:
 Not complex
 Frequently purchased
 Relatively inexpensive
 Has benefits that differentiate it from competitors
 Example: Toothpaste, snacks, soft drinks.
 Personal selling is required when the product is:
 Relatively expensive
 Benefits are not easy to understand without explanation
 Example: Insurance policies, enterprise software, real estate.
 Sales promotion fits almost any offering because it can take many forms (coupons,
contests, rebates, samples).
 Example: A discount coupon works whether it's for cereal or for a gym membership.

C. Target-Market Characteristics
 Advertising works well for a mass market that is geographically scattered.
 Example: A national fast-food chain advertising on TV to reach customers across the
whole country.
 Direct marketing (e.g., Internet) can also reach a geographically dispersed audience
efficiently.
  Example: An email campaign reaching customers across multiple countries at low
cost.
 Personal selling is useful when there are few buyers concentrated in one area who
purchase large quantities.
 Example: A steel manufacturer selling directly to a handful of large construction
companies located in the same industrial region.

D. Organizational Capacity — "Make vs. Buy" Decision

Should the company build its own sales force, or contract it out to independent reps?

Make (Company Sales Force) Buy (Independent Reps)

Perform the activity internally Contract it out
Fixed + variable costs Variable costs only
More control Acceptable control
Flexibility Lower personnel costs
Focused sales effort Greater flexibility
Greater availability Increased sales effort

Break-Even Example (Cost Comparison)

Given:
 Commission to independent reps = 5%
 Commission to company salespeople = 3%
 Salary + admin costs for company salespeople = $500,000
Formula: $$\text{Cost of company reps} = 0.03X + $500,000$$ $$\text{Cost of independent reps}
= 0.05X$$
Setting them equal to find break-even sales level (X): $$0.03X + 500{,}000 = 0.05X$$ $
$500{,}000 = 0.02X$$ $$X = $25{,}000{,}000$$
Interpretation:
 Below $25 million in sales → independent reps are cheaper (no fixed cost burden).
 Above $25 million in sales → company's own sales force becomes more cost-effective,
since the fixed salary cost gets spread over a larger sales volume, and the lower commission
rate (3% vs 5%) saves more money.
This is visualized in the Break-Even Chart, where the "Independent Reps Selling Cost" line starts
at $0 (no fixed cost) but rises steeply (5% commission), while the "Company Sales Force" line
starts at $500,000 (fixed salary) but rises more slowly (3% commission). The two lines cross at $25
million in sales — the break-even point.
10. Push vs. Pull Communication Strategies
Push Strategy
 Producer → pushes product to Retailers/Wholesalers → who push it to Consumers.
 Relies heavily on personal selling and trade promotions aimed at channel members.
 Example: A pharmaceutical company sending sales reps to convince pharmacies and
doctors to stock and recommend their drug.

Pull Strategy
 Producer → advertises directly to Consumers, who then demand the product from
Retailers/Wholesalers, who in turn order from the Producer.
 Relies heavily on advertising and consumer promotions.
 Example: Nike advertising directly to consumers on social media, creating demand so
strong that consumers ask retailers to stock Nike shoes.

When is a Push Strategy Typically Used?

1. The organization has easily identifiable buyers (e.g., a B2B company knows exactly who
its clients are).
2. The offering is complex (needs explanation — e.g., industrial machinery).
3. Buyers see the purchase as risky (high stakes, so personal reassurance matters).
4. The product is early in its life cycle (not yet widely known, so trade support is crucial).
5. The organization has limited funds for direct-to-consumer advertising (push is often
cheaper than mass advertising).
Example: A new B2B software startup with a small marketing budget might rely on direct sales
calls to convince companies to adopt their product (Push), rather than expensive TV ads.

11. Identifying an Advertising Opportunity

Advertising works best when:
1. There is favorable primary demand for the product category (people already want this
type of product).
2. The product can be significantly differentiated from competitors.
3. The product has hidden qualities or benefits that can only be communicated through
advertising (can't be seen just by looking at the product).
4. There are strong emotional buying motives involved — such as health, beauty, or safety.
Example: A vitamin supplement brand advertises heavily because:
 People generally want to be healthier (favorable primary demand),
 Their formula has a unique ingredient (differentiation),
  The health benefits aren't visible just by looking at the bottle (hidden quality),
 Health and appearance are emotional motivators.

12. Marketing Web Sites and IMC

A. Transactional Sites
 Goal: Turn an online browser into an online buyer.
 Features of successful transactional sites:
 Well-known, branded products/services
 Favorable shopping and buying experience
 Example: [Link] — customers can browse, view sizes, and complete a purchase
seamlessly.

B. Promotional Sites
 Goal: Promote products/services and inform customers how items can be used and where
they can be purchased.
 Often includes games, contests, quizzes, electronic coupons, and other gifts/prizes.
 Example: [Link] (car brand) used interactive tools to engage visitors and generate
leads, without necessarily completing the sale online.
 Promotional sites can also create "buzz" — word-of-mouth behavior generated online.

C. Viral Sites
 Goal: Encourage individuals to forward marketer-initiated messages to others via email
(like a chain reaction).
 Example: Procter & Gamble's Physique shampoo campaign — people who referred 10
friends to the promotional website received a gift. This single campaign generated 2 million
referrals, showing the power of viral/word-of-mouth digital marketing.

D. Leveraging Advertising and Personal Selling with Promotional Web

Sites
Promotional websites (backed by Internet/web-enabled technology) can support and enhance
traditional advertising and personal selling in a cost-effective way. They play a useful role in:
 The overall communication mix
 Early stages of the buying process (need recognition) — helping customers realize they
have a need.
 Development of product specifications — helping buyers understand what features/specs
they need.
 Providing feedback on product/service performance — via reviews, ratings, and customer
service tools.
Example: Before buying a laptop, a customer might visit Dell's website to build a custom
configuration (specifications), read customer reviews (feedback), and later contact live chat support
(personal selling leverage) — all without a salesperson ever calling them.

13. Communication Mix Budgeting

Principle: The budget should be commensurate with the tasks required of the communication
activities — i.e., don't just pick a number, base it on what needs to be accomplished.

A. Formula-Based Approaches
1. Percentage of Sales Approach
 Budget is set as a % of past or anticipated sales.
 Example: A company decides to spend 5% of last year's $10 million sales on
advertising = $500,000 budget.
 Limitation: Sales are the result of communication, not the cause — this method can
create a backwards logic where a company cuts advertising exactly when sales are
low and it's needed most.
2. Per Unit Method
 Multiply a fixed per-unit spending amount by expected sales volume.
 Mostly used by durable-goods manufacturers (e.g., appliance marketers).
 Example: If a company spends $20 per refrigerator on advertising and expects to sell
10,000 units, the ad budget = $200,000.

B. Qualitatively-Based Approaches
1. Competitive-Parity Approach
 Maintain spending parity with competitors' communication expenditures.
 Example: If competitors spend $2 million on advertising, a company matches or
comes close to that amount to stay competitive.
2. All Available Funds
 Spend whatever funds are available, often used when introducing a new offering.
 Example: A startup launching its first product might spend almost all its available
marketing funds in the first quarter to build initial awareness.
3. Objective-Task Approach (considered the BEST approach) Steps:
 Define the communication objectives.
 Identify the tasks needed to attain the objectives.
 Estimate the costs associated with performing those tasks.
 Example: If the objective is "increase brand awareness by 20% among young adults,"
the company identifies tasks (social media campaign, influencer partnerships, video
ads), estimates their individual costs, and sums them to determine the total budget —
 rather than picking an arbitrary percentage.

C. Advertising Budget Allocation

Six Media Types:
1. Television
2. Radio
3. Magazine
4. Newspaper
5. Billboard
6. Internet
Each medium consists of vehicles (specific channels within that medium) with unique
characteristics (e.g., within "Magazine," Vogue vs. National Geographic reach very different
audiences).
Media selection is based on:
 Cost – how expensive is it to buy space/time?
 Reach – how many people will see/hear it?
 Frequency – how often will the audience be exposed?
 Audience characteristics – does the medium's audience match the target market?
Other considerations:
 Purpose of the advertisement (awareness vs. detailed info)
 Product needs (visual vs. audio-only messaging)
 Editorial climate (does the surrounding content match the brand image?)
Example: A luxury watch brand would choose Vogue magazine (upscale audience, visual product
showcase) over a local newspaper, despite the newspaper's lower cost, because audience
characteristics and editorial climate matter more here.

D. Sales Force Budget Allocation

Formula to calculate number of salespeople needed:
$$NS = \frac{NC \times FC \times LC}{TA}$$
Where:
 NS = Number of salespeople needed
 NC = Number of customers (actual or potential)
 FC = Necessary frequency of customer calls (per year)
 LC = Length of average customer call, including travel time
 TA = Average available selling time per salesperson per year (after subtracting
 administrative time)
Worked Example:
 No. of potential customers (NC) = 2,500
 No. of calls per customer per year (FC) = 4
 Travel time per call (LC) = 2 hours
 Working hours available per salesperson per year (TA) = 1,340 hours
$$NS = \frac{2500 \times 4 \times 2}{1340} = \frac{20{,}000}{1340} \approx 14.9 \approx \
mathbf{15 \text{ salespeople needed}}$$
Explanation of the math: Total "customer contact hours" needed per year = 2,500 customers × 4
visits each × 2 hours per visit = 20,000 hours. Since each salesperson only has 1,340 selling hours
available per year, we divide total hours needed by hours available per person to find how many
salespeople the company must hire (rounded up to 15, since you can't hire a fraction of a person).

14. Evaluation and Control of the Communication Process

Purpose: Continuous monitoring of the execution of any communication to ensure that
communication objectives are actually being attained (not just assumed to be working).
Key elements:
 Should incorporate some measure of sales or profits — not just "likes" or "impressions,"
but actual business outcomes.
 Example: Tracking whether a coupon campaign actually increased revenue, not just
how many coupons were downloaded.
 Budgeting — evaluation feeds back into future budget decisions (if a channel
underperforms, funds may be reallocated next cycle).
Example: After a 3-month digital ad campaign, a company checks not just click-through rates, but
whether actual sales increased by the targeted amount. If not, they might shift budget from display
ads to influencer marketing next quarter.

Quick Summary Table

Topic Key Idea
Purchase Process Model Unawareness → Knowledge → Preference →
Purchase
Communication Objectives Primary demand (new category) vs. Selective
demand (specific brand)
IMC Mix Factors Buyer info needs, offering nature, target market,
org capacity
Push Strategy Producer → Channel → Consumer (personal
selling-heavy)
Topic Key Idea
Pull Strategy Producer → Consumer demand pulls product
through channel (advertising-heavy)
Web Sites Transactional (sell), Promotional
(inform/engage), Viral (spread via referral)
Budgeting Methods % of Sales, Per Unit, Competitive Parity, All
Available Funds, Objective-Task (best)
Sales Force Formula NS = (NC × FC × LC) / TA
Break-even (Make vs Buy) Set costs equal, solve for sales level X

These notes cover all major concepts, definitions, formulas, and worked examples from Chapter 6:
Integrated Marketing Communication Strategy and Management.