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Communicating Value

The document discusses marketing communications strategies and measurement. It presents models for how communications can move consumers through stages from awareness to purchase. It also outlines approaches for setting marketing budgets, including advertising-to-sales ratios and objective-and-task methods. Finally, it discusses different metrics used to measure the delivery and impact of various promotional methods.

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Abhi
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71 views

Communicating Value

The document discusses marketing communications strategies and measurement. It presents models for how communications can move consumers through stages from awareness to purchase. It also outlines approaches for setting marketing budgets, including advertising-to-sales ratios and objective-and-task methods. Finally, it discusses different metrics used to measure the delivery and impact of various promotional methods.

Uploaded by

Abhi
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Communicating Value - IMC

1924
1954
Hierarchy of
Effects Model:
Funnel

Awareness
Knowledge Think
Liking Designed to incite customers to
various Think-Feel-Do customers.
Preference Feel
Conviction
Purchase Do
Hierarchy of
Effects Model:
Funnel

Awareness 1. Grab consumers’ attention


2. Deliver the product’s features,
Knowledge Think benefits and values

Liking 1. Encourage positive impression


2. Generate a preference by favourably
Preference Feel comparing with competitive products

Conviction 1. Strengthen consumers’ preferences


2. Translate to sales
Purchase Do
Role of Marketing
Communications in
Decision Making

(1) (2) (3) (4) (5)


Problem Information Evaluation of Purchase Post-purchase
Recognition Search Alternatives Decision Assessment

1 2 3 4 5
Marketing
Communications
Strategy

Strategic Intent Strategic Execution Strategic Impact


 Mission  Message  Money
 Market  Media  Measurement
Marketing
Communications
Strategy

Strategic Intent Strategic Execution Strategic Impact


 Mission What are the objectives
 Market of communication?
Marketing
Communications
Strategy

Strategic Intent Strategic Execution Strategic Impact


 Mission
 Market To whom is the
communication
addressed?
Marketing
Communications
Strategy

Strategic Intent Strategic Execution Strategic Impact


 Message What is the story to be
 Media communicated?
Marketing
Communications
Strategy

Strategic Intent Strategic Execution Strategic Impact


 Message
 Media Where and how will the
story be
communicated?
Marketing
Communications
Strategy

Strategic Intent Strategic Execution Strategic Impact

How much will be  Money


spent to communicate?  Measurement
Marketing
Communications
Strategy

Strategic Intent Strategic Execution Strategic Impact


 Money
 Measurement
How will impact be
assessed?
Budgeting and ROMI
Means of budgeting
advertising-to-sales ratio Approach
• Based on how much money ‘believed’ to be
available, given their revenue projections and
other expenses.
• They then take this amount of money as a
given and decide what can be done with it, in
what is termed a top-down budgeting
approach.
Challenges with advertising-to-sales ratio
Approach
• First, advertising-to-sales ratios vary
dramatically across different product and service
categories.
• It is difficult to know what the correct
advertising-to-sales ratio should be without
analyzing customers, competitors, and other
aspects of internal and external context.
Challenges with advertising-to-sales ratio
Approach (Contd)
• Revenue projections made without consideration of marketing
support are often untenable.

• Firms with increasing revenues may find that they can be more
efficient with their marketing communications as their business
grows larger, allowing them to lower their advertising-to-sales ratio.

• Firms with weak revenues may want to increase their marketing


communications budget to try to reverse the decline, raising their
advertising-to-sales ratio in bad times.
Approach 2 – Share of Voice

• Setting of budgets by observing the marketing communications


spending of their closest competitors, and matching it to avoid being
“outshouted”.
• Managers aim to achieve a share of voice—a brand’s marketing
communications spending as a percentage of the total such spending in
the product category—equal to the company’s share of market.
• This approach is often problematic as well. If competitors are not acting
strategically in setting their marketing communications budgets,
following their lead may be a fool’s errand.
Approach 3 – Objective-and-task

• A more rational approach to budgeting approach; bottom-up process of defining the strategic

goals for marketing communications first, and then figuring out how much it will cost to achieve

them.

• In the common objective-and-task method of allocating funds, the budget is aligned with the jobs

that the firm needs the marketing communications to do, making the budget a more realistic

estimate of what it will take for the company to achieve its sales goals.
Factors Affecting Marketing Spend

•Audience Accessibility and Desirability


•Audience Size and Heterogeneity
•Task Complexity
•Media Clutter
•Financial versus Human Resources
Investment
Measurement Metrics

• Message delivery, or how widely and deeply the message


has spread.
• Message impact, or whether and how it influenced
consumers’ purchase behaviour.
• Message Delivery – reach, frequency, impressions, CTR
• Message Impact – FGD, Copy Testing, Heat Mapping
Metrics across promotional methods

Advertising Reach, Frequency to a particular demography


Goal – maximize reach, frequency, image, and impact GRP = RxF
at the lowest CPM. Impact , retargeting

Direct Marketing Response Rates, Conversion Rates ; Cost per response,


Cost per Conversion
Sales Promotion Incremental Sales Lift; Redemption rate, consumer
interactions, store visits
Personal Selling Acquistion cost, close rates, conversion rates
Public Relations Media appearance, mentions
Digital Marketing A/B testing

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