Integrated Marketing Communication and Competitive Advantage

Introduction to 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 greatest number of people in a highly effective manner without placing a serious financial burden on a company's resources, many marketing experts now combine the power of more than one communication channel to effectively reach their audience. This approach is known as Integrated Marketing Communication (IMC) strategy.

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

History and Evolution of IMC Definitions

"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, the concept had become a more widely used strategy, and a more customer-driven definition was developed. It not 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)

In 1992, Duncan broadened the definition further, writing 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 refined his earlier definition into a much more comprehensive and persuasive statement that also included the selected audiences targeted by 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)

The very next year, in 1994, Duncan also revised his earlier definition, this time including common stakeholders:

"[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 emphasis on stakeholders and different types of communication tools:

Why IMC Is Important

"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)

Anyone who understands the complicated marketing environment of today's rapidly changing world knows why it has become increasingly important to employ more than a few channels of communication. In earlier eras, with fewer sources of information available to the public, companies would use television or newspapers for advertising and could very effectively reach their audience. That is no longer the case. Audiences are now more connected to the latest technology — social networking sites and the Internet in general — than ever before. They have access to such a wide variety of information sources that it is impossible to capture their attention without creating a more powerful and more consistent message that truly appeals to the modern audience. Companies must now actively compete for audience attention, making an integrated communication strategy that combines the power of the Internet with more traditional channels all the more essential.

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

First it was the World Wide Web alone that was impressive in its power to reach audiences and provide customers with information on chosen products and services. Then, with the advent of social networking sites, advertising and marketing took a new turn. Although social media is a relatively recent phenomenon, it has taken the world by storm and has provided marketers with both greater challenges and better opportunities.

Competitive Advantage and Marketing Strategy

Competitive advantage refers to the unique feature of a company that gives it a significant edge over its competitors. With information overload, having a competitive advantage strategy has become even more critical, since it is what helps a customer decide in favor of a particular product or service — in other words, it answers the fundamental question: "Why should I buy from you?" Cole Ehmke 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 identify its unique strengths relative to competitors and connect them to the needs and demands of customers. While competitive advantage tends to work in a company's favor, it can be entirely useless if it is not relevant to customer needs. Barone and DeCarlo (2003) explain: "Building sustainable competitive advantages revolves 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 explained how nations can gain an edge over rivals in much the same way individual companies do. Porter was among the first to recognize the long-term effects of information technology. As early as 1985, he argued that information technology played a vital role in altering competitive advantage strategies. He identified three key ways in which information technology changed the competitive landscape:

"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)

Several theories have been advanced regarding what creates competitive advantage. Some believe lower costs translate into lower prices, placing a company ahead of its rivals in the customer's mind. Others advocate greater product differentiation and enhanced value delivered to the customer. The underlying goal, however, has remained consistent: companies must seek sustainable competitive advantage. An edge that lasts only a limited period should not be any company's aim; organizations must strive to create advantages that can be maintained over the long term.

Barney (1991) offered an early formal definition of sustainable competitive advantage: "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 not, however, an end in itself. Once it is developed, the main objective is to execute it successfully, and that is where marketing comes in. A competitive advantage strategy must be executed with the help of a well-developed marketing plan that communicates the company's advantage to potential customers.

In today's world, the role of the Internet and other modern media in transmitting and executing marketing strategy cannot be overlooked. Once a competitive advantage has been created, it is important to recognize that the successful execution of marketing strategy can itself constitute significant competitive advantage. Companies must utilize all available resources and channels to communicate their competitive advantage effectively. Some of these channels include:

1. Advertising through the company's website
2. Direct marketing — sending solicited emails to the target audience
3. Traditional methods such as television advertising
4. Blogs and social networking media
5. Aligning the company with a well-known cause

Over the years, the transformation of media has unfolded before our eyes. From marketing in its infancy to marketing in its current maturity, conditions have changed dramatically, and firms today understand that competitive advantage alone is not sufficient — it must be communicated successfully through effective marketing. Most organizations therefore invest heavily in marketing efforts to reach the target audience in the most cost-effective manner possible.