Integrated Marketing Communication With Customers

Integrated Marketing Communication

With customers facing serious information overload and with more and more choices being made available to them, it is only natural for companies to seek out a better and more comprehensive communication strategy to reach their target market. In order to reach the most number of people in a highly effective manner without placing serious financial burden on company's resources, many marketing experts now combine the power of more than one communication channel to effectively reach their audience and this is known as Integrated Marketing communications strategy.

History of IMC:

IMC as a major concept went through many stages of growth and as it gained greater acceptance, its definition also evolved from a rudimentary view to a more technically sound description. According to the American Association of Advertising Agencies in 1989, IMC was

concept of marketing communications planning that recognizes the added values of a comprehensive plan that evaluates the strategic roles of a variety of communication disciplines-general advertising, direct response, sales promotion, and public relations -- and combines these disciplines to provide clarity, consistency, and maximum communication impact. (Schultz, 1993, p. 17)

Three years later however, the concept had become a more widely used strategy and hence a more customer-driven definition was developed. It only focused on the available sources of information and advertising channels but also incorporated the concept of brand loyalty. This new definition stated:

The process of managing all sources of information about products/services to which a customer or prospect is exposed which behaviorally moves the customer toward a sale and maintains customer loyalty. (Duncan & Caywood, 1996, p. 18)

One year after than in 1992, Duncan broadened the definition when wrote that IMC was the "strategic coordination of all messages and media used by an organization to collectively influence its perceived brand value. (Duncan & Caywood, 1996, p. 18)

In 1993, Schultz who had presented his definition two years earlier refined it even further and in a much more comprehensive and persuasive definition, he also included the selected audiences that were the main target of IMC strategy:

IMC is the process of developing and implementing various forms of persuasive communications programs with customers and prospects over time. The goal of IMC is to influence or directly affect the behavior of the selected communications audiences. IMC considers all sources of brand or company contacts which a customer or prospect has with the product or service as potential delivery channels for future messages. Further, IMC makes use of all forms of communication which are relevant to the customer and prospects, and to which they might be receptive. In sum, the IMC process starts with the customer or prospect and then works back to determine and define the forms and methods through which persuasive communications programs should be developed. (Schultz, 1993, p. 17)

Interestingly the very next year in 1994, Duncan also revised his earlier definition and this time his refined version included the common stakeholders as well:

[IMC is] the process of strategically controlling or influencing all messages and encouraging purposeful dialogue to create and nourish profitable relationships with customers and other stockholders, (p. 18)

Gronstedt proposed a definition from the public relations viewpoint, with emphases on stockholders and different types of communications tools:

Integrated communications uses an appropriate combination of sending, receiving, and interactive tools drawn from a wide range of communication disciplines to create and maintain mutually beneficial relations between the organization and its key stockholders, including the customers. (Gronstedt, 1996, p. 292)

WHY IS IMC IMPORTANT?

Anyone who understands the complicated marketing experience of today's rapidly changing world knows why it has become increasingly important to have more than a few channels of communication. In old days with fewer sources of information available to the public, companies would either use television or newspapers for advertising and could very effectively reach their audience. But that is no longer the scenario. For one audiences are now more in touch with the latest technology like social networking sites and the Internet in general than they had ever been before and secondly, they have information sources so varied that it is impossible to get their attention without creating a more powerful and more consistent message that would truly appeal to the new audience. Companies now really need to fight for audience's attention and for this reason, it is important to make sure of an integrated communication strategy that would combine the power of the Internet with more traditional sources.

From mass marketing, companies made a quick shift to customer-centered marketing approach and that has given rise to an increased interest in understanding the strategic ramifications of an integrated marketing approach. It is no longer possible to reach the target audience by using the old mass marketing method where selling to everyone at the same time was the main idea. Things have changed dramatically and that has been primarily due to the exponential growth of "new electronic media" which has forever alerted the way marketing was done. (Bezjian-Avery et al., 1998; Hoffman and Novak, 1996).

First it was the World Wide Web that alone was impressive in its power to reach the audience and to provide customers with information on the chosen products and services. But then with the advent of social networking sites, advertising and marketing took a new turn. Even though it may be a relatively new phenomenon but which had taken the world by storm and have provided marketers with even greater challenges and better opportunities as well.

COMPETITIVE ADVANTAGE MARKETING

Competitive advantage refers to that only feature of a company that gives it significant edge over the competitor. With information overload, having a competitive advantage strategy has now become even more critical since this is what helps a customer make his decision in favor of a product or service. In other words, it answers the million dollar question: "why should I buy from you?" Cole Emhkse defines competitive advantage as, "an advantage gained over competitors by offering customers greater value, either through lower prices or by providing additional benefits and service that justify similar, or possibly higher, prices. For growers and producers involved in niche marketing, finding and nurturing a competitive advantage can mean increased profit and a venture that is sustainable and successful over the long-term."

In order to develop a strategy around competitive advantage, it is important for a firm to discover its unique strengths against the competition and to connect them to the needs and demands of the customer. While competitive advantage tends to work in company's favor, it can be absolutely useless if it's not relevant to customer's needs. Barone and DeCarlo (2003) thus explain:

"Building sustainable competitive advantages revolve around differentiating a product from the competition along attributes that are important and relevant to customers."

Michael Porter was one of the pioneers in the field of competitive advantage strategy. In his book, Competitive advantage of Nations, he first explained how nations can get an edge over their rivals in much the same way as individual companies do. Porter was among the first few to see the long-term effects of information technology. Back in 1985, he argued that information technology played a vital role in altering competitive advantage strategies in today's world. He identifies three ways in which information technology has changed the competitive advantage scenario:

"First, advances in information technology are changing the industry structure. Second, information technology is an increasingly important lever that companies can use to create competitive advantage…Finally the information revolution is spawning completely new businesses." (Porter, 1985, p.7)

There have been several theories regarding what helps in creating competitive advantage. Some believe lower costs can translate into lower prices which place a company ahead of its rivals on customer's mind. Others have believed in greater product differentiation and enhancing value offered to the customer. The bottom line has however been the same throughout i.e. companies must seek sustainable competitive advantage. In other words, to have an edge for a limited period should not be the aim of any company. It must always strive to create advantage that can be sustained over a long period of time.

Barney (1991) offered a formal early definition of sustainable competitive advantage when he said: "A firm is said to have a sustained competitive advantage when it is implementing a value creating strategy not simultaneously being implemented by any current or potential competitors and when these other firms are unable to duplicate the benefits of this strategy" (p. 102).

Competitive advantage strategy is however not the main aim of any company. Once it is develop, the main objective is to successfully execute it and that is when marketing comes in. A competitive advantage strategy needs to be executed with the help of a well developed marketing plan that would communicate company's advantage to potential customers.

In today's world, we cannot overlook the role played by the Internet and other modern media for transmission and execute of marketing strategy. Once a competitive advantage has been create, we must understand that marketing strategy and its successful execution in itself can offer significant competitive advantage. Companies must utilize all available resources and channels to successfully communicate their competitive advantage and some of these channels include the following:

1. Advertising through company's website

2. Direct Marketing-sending solicited emails to target audience

3. Traditional methods like television advertisements

4. Blogs and social networking media

5. Aligning company to a well-known cause

Over the years, we have seen the transformation of media right before our eyes. From marketing in its infancy to marketing in its maturity, things have changed dramatically and firms today understand that competitive advantage alone is not important, it must be communicated successfully through effective marketing and hence most organizations would invest heavily in marketing efforts to reach the target audience in the most cost effective manner.

RELATIONSHIP MARKETING:

Relationship Marketing is not exactly a new concept in marketing. It has been present in its more rudimentary form for ages but it is only now that we have been able to fully comprehend the meaning and scope of relationship marketing. Relationship marketing refers to a strategy by means of which a company develops a close on-going connection with its customers, suppliers and other people in the value chain. The focus is on the word "on-going" which means that relationship doesn't end with a transaction. It is more consistent and continuous whereby companies try to reach the same people over and over again and they in return prefer the company's products and services over rivals' offerings.

"Relationship marketing refers to the development, growth, maintenance of long- term, cost- effective exchange relationship with individual customers, suppliers, employees, and other partner for mutual benefit. " (Boone and Kurtz, 2007)

Relationship marketing can sometimes backfire or prove fruitless with customers complaining of because pestered or companies sending them offers through unsolicited mails or telephone calls but marketing experts still maintain that it is more beneficial to a firm in the long run than simply transactional marketing.

There are various ways in which relationship marketing exists. Companies would ask for your email or phone number when you purchase an item and this is their way of staying in touch with you because they know you have once been their customer. Companies like Bloomingdales, Kohl's, Sears etc. would have customers sign up for their membership cards or charge cards which automatically connect the customer to the firm for the long run.

Relationship marketing doesn't only focus on the customers. It also takes into account every single important unit in the value chain such as the suppliers and manufacturers etc. The company will maintain good relations with its suppliers but in most cases it will not be as friendly as with customers because that can cause problems. Suppliers can become complacent which is not healthy for the firm. Dell thus practices "tough love" policy with its suppliers while maintaining positive relations:

"Michael Dell describes the relationships to the suppliers as a kind of friendship, in fact, they are not. Michael Dell himself says that DELL wants to be a tough customer. This is mainly to avoid complacency among suppliers, that Brennan (1997, p.771) describes as one of the downsides of partnering. Using, for example, a 'supplier report card', a tool to 360-degree evaluate a suppliers performance also in comparison to other suppliers, DELL ensures that e.g., cost, defect tolerance, availability of technology, inventory velocity, etc. are always up to its expectations. Otherwise, a supplier is dropped. (Dell 1999). These measures help to secure that DELL avoids 'backing the wrong horse' (Brennan 1997)." [Schmid et al. 2003]

EFFECTIVE MARKETING COMMUNICATION AS SUSTAINABLE COMPETITIVE ADVANTAGE

As companies try to discover their sustainable competitive advantage (SCA), they also need new and better ways to communicate the same. The study and power of integrated marketing communication has made it clear that in today's competitive world, it is the communication strategy and marketing capabilities that will determine whose competitive advantage is most sustainable.

Marketing communication has been impressive in its growth and scope. The role of marketing capabilities indicate that marketing done effective can serve as single most important factor in determining a company's success. Effective marketing initiatives including development of a high-functioning distribution network, conducting good market research and promoting it to the right target audience result in the success of a product which is very much the same thing as having competitive advantage which also means making right products available to the right people at the right time. Thus we can safely announce that marketing capabilities lead to sustainable competitive advantage.

(Weerawardena 2003, 22).

Over the long-term sustainable comp advantage refers not only to an edge over the competitor but can be narrowed down to two important factors namely highly value attached to the product and low cost of development and distribution. If a company can produce high value products at lower costs consistently, then it can safely stay ahead of competitive and gain SCA. This is what the customer will then use to determine the place of a product in his or her mind as against the rival products. (Adcock 2001, 182).

CA in other words can be viewed as having consistently higher position in consumer's mind. We already know that when consumers are bombarded with excessive variety and choices, they tend to assign a position to each product and service according to his or her own criterion. When a company and its products are consistently high on consumer's mind ladder that shows that the product or company has been able to achieve SCA. It is believed that a company that has higher SCA and consistently performs better than rivals has access to knowledge bases hitherto unknown to others. They are not only able to tap into these resources but can also manage them to their advantage. (Tsai and Shih 2004, 524).

The transformation of a company's key process into strong capabilities that not only are relevant to customer's needs but also provide him with better value for money is what becomes CA for the company. It is all about paying closer attention to the core inner strengths of a firm and these strengths can be given various terms like "resources," "invisible assets," strategic assets," "firm resources," "capabilities," "competency" and "core competencies" (Juttner and Wehrli 1994, 43).

It is important to understand that resources are not the same thing as capabilities. A firm has resources which are its productive factors while capability is the power to "deploy these resources…to affect the desire end." (Dutta, Narasimhan and Rajiv 1999, 550) Thus if a firm wants to enjoy consistent advantage over others, it must have strong capabilities to fully use its resources in its favor.

BARRIERS TO IMC

Integrated marketing communication sounds like the most perfect strategy any company could develop for connecting with its target market. But that may not always be the case. When applied effectively, it certainly brings in many much desired rewards in terms of higher revenues and more customers but when allowed to become the sole means of communication, it can actually have some serious downsides. These are some of the barriers of IMC or barriers to implementation of IMC.

For one, there may actually be the usual resistance to implementation of IMC because of general fear of the new and the unknown. Resistance is very common in companies and when employees have not been properly educated about change, they can in most cases become highly resistant to change which may also include the use of different and new methods for communicating with the public.

Even if the company is able to overcome the initial obstacle, it can then face the challenge of effectively harnessing the power of so many varied channels of communication. It is easier said than done and communicating through variety of channels such as the Internet, the social networking sites, newspapers, television, radio, direct marketing etc. can be very overwhelming and can prove counterproductive if not done correctly.

Smith and Taylor (2004) identify some of the key barriers to IMC. According to them, these common barriers include, "Functional Silos; Stifled Creativity; Time Scale Conflicts and a lack of Management know-how." (p. 17)

"Functional silos" is the organizational structure that makes it impossible to implement new ideas due to either budget constraints or power politics. There are cases where firms would maintain very tight control over how things work and when a new idea like IMC is introduced, they tend to become very more restrictive in their approach as adopting a new idea is equated with relinquishing control.

"…this can be aggravated by turf wars or internal power battles where specific managers resist having some of their decisions (and budgets) determined or even influenced by someone from another department." (p.17)