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Marketing Communication: Meaning, Purpose, Role, Process and Strategies
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In this article we will discuss about marketing communication. Marketing communication has a vital role in brand building in the market. Mass media advertising, personal selling, public relations, publicity and sales promotion – are the various communication tools that a marketer generally uses to address the communication problem which the brand faces in the market and as a part of product promotion.
Marketing communication that occurs through promotion tools provides both information and persuasion basis to target consumers. So, it works as a ‘stimulus’ that may trigger the decision-making process and also helps in the making of informed decision. It is important to note here that marketing communication occurring through the use of promotion tools is only one of the stimuli affecting decision-making about the product.
Marketing Communication Advertising has certain unique features, which distinguish it from other forms of marketing communication such as personal selling, sales promotion (SP) publicity and public relations (PR).
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Learn about:- 1. Meaning of Marketing Communication 2. Purpose of Marketing Communication 3. Elements 4. Process 5. Role 6. Approach 7. Strategy 8. Planning and Strategy Inter-Relationship 9.Role 10. Relevance 11. New Model 12. Goals.
Marketing Communication: Meaning, Process, Elements, Strategy, Approach, Strategy, Role, Relevance, New Model and Goals
Content:
- Meaning of Marketing Communication
- Purpose of Marketing Communication
- Elements of Marketing Communication
- Process of Marketing Communication
- Role of Marketing Communication in Brand Building
- Approach of Marketing Communication
- Strategy of Marketing Communication
- Planning and Strategy Inter – Relationship
- Role of Communication in Value Creation and Delivery
- The Relevance of National ‘Diamond’ and Mckinsey’s 7S Model in Communication Theory
- The New Model of ‘Communication and Strategy’
- Goals of Marketing Communication
Marketing Communication – Meaning
While ‘planning communication strategy’ the word communication holds the centre linking both planning and strategy. Communication has enabled homo-sapiens to progress both by transmitting knowledge and being a channel for addition of this knowledge. It encompasses within itself the potential for generating change as well as development of behaviour and response systems.
What holds true for mankind applies equally to both organizations and marketing strategy. Our study of ‘communication’, however, is often limited by the definition we give it. Marketing communication, as we define it, remains always a subset of the company’s communication, it does not result from formal planning but is something that is informally achieved.
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Competitive success if achieved due to this overall communication that, may be a result of accident rather than design. The effort here is to give a formal structure to this overall or integrated communication of the firm.
The role of communications in marketing, within what is often referred to as the company’s communications mix. Whatever the object of marketing activity – whether a new product, a brand or product range, or the whole of a company’s activities – there will be scope to develop and apply communications objectives in service of the marketing task.
Basically, marketing communications involve enhancing or achieving awareness, better understanding, shared beliefs and meaning, and positive associations, attitudes and predispositions in favour of the product, service or organisation that is being marketed.
While all business functions depend on some coordination and relationship with others, marketing is perhaps more people-centred than many, and certainly most involved with key stakeholder groups such as customers, trade bodies, media commentators and the like.
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Obviously, relations with these stakeholder groups require a carefully planned and executed communications function. Furthermore, as marketing effectiveness depends at least partly on non-marketing functions within a company, it follows that marketing communications may be affected by any of the company’s dealings with the outside world.
Marketing Communication – Purpose
Before we attempt an understanding of marketing communication, it is essential to start with the purpose that it seeks to achieve.
We know that the purpose of marketing effort is to increase value delivered to the customer. This is to be done at the minimum cost to the customer.
The following equation sums it up:
Customer Delivered value = Total Customer Value – Total Customer Cost
The purpose of marketing communication can be no different from the purpose of marketing i.e., to maximize customer delivered value. This can be increased by increasing the total customer value or lowering customer cost. Offering to customers which involve delivering more value or lowering cost cannot be successful by effort of only the marketing department but has to involve all departments of the firm.
A need therefore exists to recognise all communication that is innovation-driven (or driven by a desire to add value to customers) as part of marketing communication. Cross-functional cooperation is essential to design and implement a superior customer value delivering system. Hence efforts of marketing department alone in building a communication strategy may not be able to ensure greater delivered value. The formal recognition of this mutual interdependence within the firm to deliver value, will make its focused concern build a superior competitive strategy.
Today’s age has been revolutionised by communication. Scientific technology that aids it has enabled this process. The world today is a world of innovation and open competition. Every firm therefore, in the words of Porter, “has to attempt to put itself in a position where it is likely to perceive and best address the imperatives of competitive advantage”.
To achieve this competitive advantage firms must focus their concern on improvement and innovation. This has to result form a willingness to compete and realistic understanding of the environment and how to improve it. Information and communication play a very important role in the ability and capacity of a firm to innovate and successfully deliver competitive response through value added offerings to their customers.
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Where communication has so significantly affected the ability of a firm to influence itself, its customers, suppliers and related industries, it is time for communication to update its own theory and upgrade the level of comprehension of its enhanced abilities.
Marketing Communication – Top 5 Elements: Advertising, Direct Marketing, Personal Selling, Public Relation and Sales Promotion
The five elements of the Marketing Communication mix are Advertising, Direct marketing, and Personal selling, Public relations and Sales promotion. These are discussed below.
The Marketing Communication Process, Marketing Communication Strategy and Marketing Communication Plan pages also provide additional thoughts and tools for optimizing your marketing communication mix.
The components of the marketing communication mix are discussed below and put into perspective for successful marketing to today’s consumers by today’s business. Although marketing underwent a great transformation similar to that of business as a whole in the twentieth century, the traditional components of the marketing communication process are still in use and important today.
1. Advertising:
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This is the mass media method of marketing communication and provides exposure to the largest, most geographically dispersed audience at the lowest cost per head. That being said, advertising costs can add up quickly with mediums like television, radio and even online advertising which can be prohibitively expensive for many businesses.
Other traditional forms of paid advertising include newspapers and magazines, the Yellow Pages, billboards, signs and posters. As well, advertising on buses, benches, gas pumps and even public restrooms is in vogue today.
Basically, any medium which provides an opportunity to target “eyes and/or ears” can be a venue for advertising and you can see examples of successful promotion in the most unlikely places.
2. Direct Marketing:
This marketing communication competency enables companies to reach out directly to consumers without intermediary channels such as those required for advertising. This component of the marketing communication process includes direct mail, catalogs, coupons and inserts, telemarketing, online marketing and television infomercials.
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Done correctly, Direct Marketing is extremely effective in the long run and allows for a targeted marketing approach to specific consumers to create valuable lasting relationships.
Direct Marketing is the marketing communication method that enables companies to interact with a relatively large number of customers and encourage a “call to action” or “most wanted response” which is usually a purchase.
The downside of Direct Marketing is that it is usually unsolicited and seen as a nuisance by the general public. Telemarketing, e-mail spamming and junk mail are universally despised and so Direct Marketing tools should be used with thought and caution. Visit the Direct Marketing Association website for guidance on legal and ethical Direct Marketing.
3. Personal Selling:
This is the most dreaded as well as the most expensive of all methods in the marketing communication process. However, if you are a small business owner or otherwise have the ability to personally sell and build relationships with customers, it can be one of the most rewarding aspects of the marketing process, both personally and professionally.
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Just as with traditional marketing, successful selling begins and ends with the customer. The whole objective is to ascertain needs and create the best solution for customers.
Along the way you build relationships and continue to gather information about how you can better serve customers which is your reason for being in business in the first place.
Sales and marketing are fundamental to the survival of any business and both involve creating customers for the business value you have created. The former targets one person or entity whereas the latter targets many.
Both engage, inform and persuade through a variety of communicational tools. Aligning both will increase your success regardless of conditions. Successful sales and successful marketing both begin with an attitude and that attitude is customers first.
4. Public Relations:
This refers to how you handle your relationships and the flow of information with your various “publics” or the people who have a stake in or are affected by your business. This includes the general public, consumers, shareholders, employees, partners, competitors and the government.
Public relation becomes a more and more crucial element of the marketing communication mix as a business or organization grows larger. That being said, it is still a vital component of the marketing communication process to think about for smaller businesses as well.
Public relations tools include press and media releases, lobbying, charitable and public events, advertorials, financial reports, promotional collateral, facility tours, sponsorships, interviews and any other method for the promotion of a positive image to people.
Once again, people buy from people at the end of the day and the most successful people and organizations are those that benefit other people the most. As with many facets of sales and marketing, PR also has a “good” and “bad” side.
The good side of public relation is fostering socially conscious business practices whereas the bad side is epitomized in shady political lobbying, “spin doctors” and so forth that divert from the truth as opposed to promote it.
Suffice it to say that in today’s connected world, more than ever, any sized organization needs to be cognizant that it operates within the larger framework of society and has corresponding responsibilities.
The Institute for Public relations website is an excellent resource for additional material on the role of Public Relations in the marketing communication process.
5. Sales Promotion:
This is the last traditional component of the marketing communication mix that is discussed here as part of the marketing communication process. Sales promotion simply refers to purchase incentives that you provide your customer with.
These can assume a number of forms including offering free goods or services, coupons and vouchers, gifts and prizes, discounts, samples, financial incentives, charitable promotions and any other value add over and above your standard product or services.
Marketing Communication – Process in Addition with Areas: The Consumer, The Business Environment and The Media
In communication process, there is a transmission of message from a sender to the receiver. The end result of the communication process is the understanding of the message. The message is transmitted through media or certain channels. The response to the message is known through the feedback from the receiver of the message.
The communication sometimes fails to accomplish its purpose — creation of an appropriate response or understanding when the message is distorted by ‘noise’ elements. A sender encodes the message, whereas the receiver decodes the message.
The sender is called the source of the message. The encoding could be in the form of a letter or advertising copy. The message is carried by the media, e.g., post and telegraphs department or TV or press.
The message is a received by the receiver who responds to it, which is then communicated back to the source. The message must arrest the attention of the receiver, be understood and stimulate the needs of the receiver and suggest methods to satisfy these needs.
It is important for the senders to know the receivers or audiences they would like to reach and the responses they expect. The skill lines in the proper encoding of the message. It should anticipate how the message would be decoded at the receiving end. As the ultimate success of communication is the understanding of the message to know as much as possible about the receiver.
The media chosen too must be efficient. The feedback channels are established it to necessary for the sender to know the response. In this process noise variables may distort the effectiveness of the communication. Noise includes poor planning of the message, busy audience members or careless feedback mechanism.
The common field of experience and reference makes the communication possible. It there is no such overlap, communication may be poor or impossible. The feedback comes as marketing research inputs or sales reports. The noise elements are the competitive promotional messages.
Communication can be made more effective by understanding the audience and the market properly. Marketing communication is a major chunk of the total corporate communications. Advertising is an important element of the marketing.
The sender of the message is the marketer. The message is encoded as advertising copy, publicity material, sales displays or sales talk. The media to deliver the message could be print media such as press/magazines, or electronic such as radio/TV/films or a salesman making a sales talk.
The decoding involves the interpretation of the message by the consumers. This is the most challenging part of the marketing communication, as the consumer may not always interpret the message as the marketer desires it to do.
The fundamental difficulty arises in communication at the stage of coding and decoding. This results from the differences in interpreting the meanings of different words/symbols. There may be different frames of references and field of experience between the sender and the receiver.
Marketing Communication Advertising has certain unique features, which distinguish it from other forms of marketing communication such as personal selling, sales promotion (SP) publicity and public relations (PR).
To facilitate communication, the source and the receiver must share a common background, social influences and needs. When these overlap, it is called overlapping of psychological fields. The larger the mutually shared field, the greater the chance of effective communication.
The use of ‘dogmatic’ communications was seen in many commercial monologues of the time, both in television advertising to consumers and in ‘hard-sell’ personal selling techniques in business-to-business markets. Unfortunately, they missed the fundamental point of marketing- listening and responding to customers.
In contrast, the marketing communications task of the 1990s and beyond are the pursuit of dialogue with customers. The growing interest in relationship marketing means that companies now seek to build mutually beneficial, long- term relationships with a number of audiences, including customers, consumers, suppliers, shareholders, legislators and employees.
There is a recognition that many traditional communication tools are less appropriate for this task, and that the development of new technology and interactive media provide an opportunity to communicate with consumers as never before.
One-to-one marketing communications, driven by behavioural data and enabled by powerful databases, are becoming the norm. Since interactive media provides the potential for enhancing customer involvement with particular goods and services providers, marketers are now seeking to use a much wider range of communication tools to facilitate dialogue with customers.
Recent research shows that the drivers of change in marketing communications practices represent three main areas- the consumer, the business environment, and the media:
1. The Consumer:
Consumers are shaping the market place of the future, forcing communication and distribution channels to develop to suit their needs. Consumers are becoming more sophisticated, sceptical and marketing literate, presenting the marketer with formidable challenges.
Increasingly, consumers will decide when and how they wish to communicate with supplying organizations, as well as how much information they wish to impart about themselves, and all at a time that is convenient for them.
The growth in consumer power and the rise of the ‘cynical individual’ response to advertising means that companies also have to consider the transparency and integrity of their marketing messages. Ethical issues are assuming greater importance on the marketing agenda, for consumers are no longer passive receivers of messages, but generators of their own messages. The power of the consumer ‘voice’ was vividly illustrated by the recent Monsanto fiasco.
Early in 1999, adverse consumer reactions to media stories about genetically modified (GM) foods caused retailers such as Marks & Spencer and J. Sainsbury’s to backtrack on their original support and promotion of GM foods and to de-stock all such products. The companies also launched marketing campaigns reassuring customers that they had listened to them and acted on their concerns.
As well as being individually and collectively empowered, consumers are also no longer regionally or nationally bound; they are members of a global society. Advancements in media technologies and coverage have opened up the world, giving consumers a global consciousness and conscience.
Increasingly, consumers are apt to distrust the corporate world and marketers can no longer assume anything about them. It is only through winning their trust that companies can hope to build relationships with them and gain a competitive edge.
Businesses have changed dramatically in the last decade, and the most significant catalyst has been the impact of computer technology on the everyday lives of organizations and individuals. Information and communications technology, or ICT, has facilitated a revolution in the sheer amount, lightning speed and plummeting cost of information processing.
For businesses, one of the biggest impacts has been the access to information about customers and consumers. While this obvious advantage is available to many, the most successful companies are those that use this information to deliver superior customer value.
In the UK, retailers have developed loyalty schemes which allow them to do just this, and customers have responded by becoming increasingly committed to a relationship with their supermarket, rather than any individual brand of product. However, many organizations have seen their influence over the consumer deteriorate rapidly.
This is because the ‘relationship’ that existed between supplier and buyer was based on a promise of superior value, which was proved hollow with the advent of good quality, low-priced, own-label products. This was especially the case for FMCG (fast-moving consumer goods) manufacturers who, as stated earlier, relied on mass communications.
Developments in computer technology have also allowed companies with large customer bases to provide a superior level of individualized service and to customize their product or service offering to suit the customer.
First Direct revolutionized personal banking by offering greater customer access and convenience through the introduction of a 24-hour banking service. This customer-focused initiative has won the company many profitable customer relationships, as well as regular recognition for having the most satisfied customers in the sector.
Interestingly, many high street icons are suffering in the UK business environment of the late 1990s, Marks & Spencer being the most famous of them. It seems that the most successful companies today are those that change the rules, such as Amazon.com, the Internet book retailer and Dell, the computer company.
These companies are engaging with customers in a new and innovative way, which involves facilitating a longer-term relationship with the customers they win. Rather than regarding the changing business environment as unwelcome, they eagerly exploit it, to the ultimate advantage of the consumer.
In the last ten years, the world’s media map has been redrawn as a result of media proliferation and fragmentation. In the past, it was easy for companies to reach a large number of consumers with relatively few advertisements.
For example, in the USA in 1960, an advertisement on prime time network television reached over 90 per cent of all households. However, by 1994, the same three networks could deliver only 50 per cent of all households.
The increase in network and satellite television channels, information and entertainment provision via the Internet, magazines, and radio and teletext services, and a switch to alternative leisure habits have meant that consumers take part in a much wider range of activities than ever before. With so many competing forces, their attention is more difficult to capture and their patience with marketing messages is waning.
It is estimated that consumers are bombarded with up to 3000 communications and messages every day, and as a result they have become much more discerning as to which ones they listen to, never mind respond to. This reduction in access to large groups of potential customers through television has made it much harder and more expensive for advertisers and their agencies to communicate via mass messages.
Research by Howell, Henry, Chaldecott, Lury (HHCL) found that people who watch television regularly also practice various activities in front of their television sets, using them like a radio as background entertainment. Additionally, the escalation in the use of remote control devices and videos means that many viewers channel-hop or fast-forward the moment any advertisements are broadcast, diminishing the delivery and impact of the advertising messages.
This growing habit among viewers has major implications for any marketer considering spending £150000 to show their latest advertisement on a 30-second slot during a popular television soap opera such as ‘Coronation Street’.
In the UK, consumption of ‘relatively’ mass market commercial stations is now much higher among older viewers and lower socio-economic groups. Henley Centre research confirms this, showing that the more ‘up-market’ a shop is; the less likely it is that branded goods are purchased from there.
This finding is attributed to the light television viewing of higher level socioeconomic groups who are not influenced by the branding messages transmitted on the major broadcasting channels. Many marketers acknowledge that it has become very difficult to communicate to high earners and younger males, as their media habits are increasingly individualistic and diverse.
As well as changes in the types of audience that can be reached via more traditional media channels, the tremendous growth in the supply of media has made the implementation of a communications programme a much more complex task. The choice of communication tools and media is extensive and, as Figure 13.2 demonstrates, prospective and existing customers can now be reached in a far larger number of ways than was possible only a decade ago.
Consumer enthusiasm for new media is defining communications of the future. The development of interactive devices in advertising, direct mail and the Internet have helped to increase the diversity of methods for communicating and exchanging information.
In particular, e-mail, discussion groups, data interchange and downloading, on-line advertisements and linked web sites all provide new ways of developing, strengthening or influencing relationships with customers, employees, media, suppliers, and even competitors.
It is certain that the escalation in the access to and usage of Internet technology will mean that communicating directly with customers will become a much cheaper and faster option for marketers.
In summary, consumer empowerment, technological advancement, media fragmentation and the pressure on marketers to justify the returns on marketing communications expenditure are intensifying the need to re-examine exactly how marketers plan and implement their communication strategies.
Only recently has there been widespread recognition of a requirement to integrate the variety of messages, information and images that are used to influence the company’s range of stakeholders.
Value Addition for Customers and Society:
Communication, again, is not just with present and prospective customers but also with employees, vendors, related industries, other advanced factors like human resources including skilled and scientific resources and external environments. This appreciation of the role of communication is especially critical in “knowledge intensive” industries. The primary task of all the firm’s efforts is to devise a competitive strategy and communication can contribute effectively to it.
In-company training is one of the most important tools of communication. A good in-company communication strategy about what the customer needs and the need for ensuring cost control or increasing customer satisfaction could help increase productivity, profitability as well as offer value and satisfaction to the customer. This will especially be the case as the service element attached to the product keeps increasing.
Marketing Communication – Role in Brand Building
Marketing communication has a vital role in brand building in the market and the opening case of micromax mobiles rightly supports this notion. Mass media advertising, personal selling, public relations, publicity and sales promotion – are the various communication tools that a marketer generally uses to address the communication problem which the brand faces in the market and as a part of product promotion.
These tools are combined differently for different brands and each such combination constitutes the promotion mix for a brand. As, different brands have different communication problems, the promotion mix for each one of them differs in terms of the type and also the extent of emphasis on the use of various promotion tools.
The factors such as – nature of product, customer type, availability of funds and skills with the organization and the kind of marketing environment – further affect the mix of these promotion tools for a particular brand.
Marketing communication that occurs through promotion tools provides both information and persuasion basis to target consumers. So, it works as a ‘stimulus’ that may trigger the decision-making process and also helps in the making of informed decision. It is important to note here that marketing communication occurring through the use of promotion tools is only one of the stimuli affecting decision-making about the product.
Product features, quality, brand name, package, and price, too, have communication value for the product and are more dominant stimuli in affecting the product purchase. In this regard, considering marketing communication as a set of promotion tools only actually restricts its scope and gives a very narrow perspective to the concept.
Instead, we need to understand communication beyond these formal communication tools and realize that there are non-formal ways, too, that communicate about the brand.
The basics of communication and explains the underlying process of communication. The concept of marketing communication is discussed to explain its specialized nature which pertains to its relation with the market.
Various steps of communication planning are explained in the end to help in understanding the difference between effective and ineffective marketing communication. To marketing communication and explain an integrative approach and its implications for communication planning.
Marketing Communication – 2 Main Approaches of Marketing Communications: Corporate and Marketing – Oriented Approach
Organisations differ in their approach to Planning of Marketing Communications. However, there are two broad approaches practiced in general.
1. Corporate Approach:
Despite changes that take place or even overtake us, there are organisations, which consider promotion as an “extra” cost. Such organisations do believe their product is unique and they are in a good position to dictate terms.
The domestic airlines would be a very good example. There was no alternative to air passengers other than Indian Airlines for domestic flights. The Organisation was not marketing oriented.
The rules got changed to suit the Organisation’s whims and fancies. For example, most airlines have common-rated rates like, a passenger flying (in either direction) Mumbai-Chennai could pay the same fare for Mumbai-Bangalore-Chennai. This was so with Indian Airlines until one day their management decided to charge sector fares. This was to maximise revenue.
This millennium saw the advent of private airlines. Now, there are all kinds of concessional fares and Indian Airlines (now merged with Air India) is not only marketing oriented but is also innovative in its approach to building relationships.
Another example would be our automotive industry. Before liberalisation, there were just three manufacturers (one went out of business) all in a seller’s market – with long wait lists. Similar was the condition with telephones. These were all production oriented.
2. Marketing-Oriented Approach:
In organisations that utilise marketing approach, marketing communications is given the importance and seriousness it deserves. Besides, it is notionally treated as a capital expense (reason being APSP – Advertising, Publicity, Sales Promotion as a heading in the Accounting to suit the law in our country, which ensures the entire expense is accounted) and, for every new product, the ROI concept is used. This ROI in some companies, for new products, could be after as much as five years.
In such organisations, outstanding marketing communications is encouraged since this is a source of building competitive advantage, particularly among competing products with little or no difference at all.
Developing Marketing Communications, earlier, involved answering a few questions.
These were:
i. What are we selling?
ii. To whom are we selling?
iii. Where are we selling?
iv. When are we selling?
v. How are we selling?
The answers had to be in great detail – it is not enough to say we are selling a product. We need to describe how it is a better product, the name, competition, etc., and similarly for all the questions.
Since the world of ours is not that simple anymore, we develop marketing communications by going through several steps starting with situation analysis.
These steps are:
i. Selection analysis,
ii. Review of marketing programme,
iii. Setting marketing objectives,
iv. Branding strategy,
v. Packaging,
vi. Positioning strategy,
vii. Strategic messages,
viii. Media strategies,
ix. Promotion strategies,
x. Public relations,
xi. Sponsorship,
xii. Publicity,
xiii. Sales forces,
xiv. Point of purchase promotion,
xv. Budget formulation,
xvi. Implementation of communication strategy, and
xvii. Evaluation & feedback.
Marketing Communication – Strategy: Overall Cost Leadership, Differentiation and Focus
Strategy – Build it with Integrated Communication:
Corporate strategy depends on understanding the business and marketing environments. Only after a correct understanding of the environment has resulted can the Marketing or Marketing Communication planning be determined. Hence strategy should be one that flows thematically across the corporate and marketing plans to the promotion planning process of the firm.
In today’s competitive scenario communication strategy cannot ignore the imperative of competitive advantage. In fact, strategy of a firm should germinate from its ability to (a) perceive and (b) create this advantage through value added offerings. Communicating the competitive advantage of this value added is the third or final task to which all discussions of communication strategy are usually restricted.
It is suggested that a full appreciation of communication strategy is not possible unless all the three roles are understood. A firm’s strategy, thus, has to be built with communication. Before exploring the inter-relationship of communication and strategy building, it may be useful to begin with the parameters of strategy first.
Three Generic Strategies and their 3 Strategic Fits:
To counter the competitive forces, Porter shows how the firm’s Strategy can be built in 3 ways:
1. Overall cost leadership – Developing a focused concern for and investing in cost-saving processes enables this. So does a high market share, economies of scale in production or favourable access to raw material.
2. Differentiation – This is the ability to create something that is perceived as unique. This could be in product design, brand image, technology, product features, customer service, dealer network of other dimensions.
3. Focus – Instead of targeting the complete market, the firm focuses on a particular buyer group or geographic market to serve it more effectively and efficiently.
Each of the three generic strategies can be fulfilled if the three fits, listed by Porter, occur in all the activities undertaken by the firm.
A successful strategy should ensure that these three things are occurring in the activities as well as their interactive process within the firm.
i. Simple-consistency – There should be a consistency between each activity (function) and overall strategy. Identifying the three C’s of communication strategy of a firm in the manner described here enables this simple consistency to occur. Co-operation between the functions of the firm followed by a focused concern for ensuring consistency leads to delivery of the firm’s competitive response.
ii. Reinforcement – The various activities of the firm should reinforce each other. This is exactly what identification of the 3C processes seeks to do.
iii. Optimisation Effort – The configuration of the individual activities of the firm and the way they relate to each other should be an optimisation effort. This, is the objective of identification of the 3C processes.
The task of communication within a firm is, therefore, to ensure that its activities are consistent, reinforcing and optimising in nature. The ability of communication to ensure this will enable the firms competitive advantage as well as competitive success. Communication strategy and firm’s strategy building processes therefore flow with each other. The communication processes help build the strategic processes of the firm. This appreciation requires having a relook at the role of communication, as it has been popularly understood, till date.
From Integrated Marketing Communication to Integrated Communication Concept:
The focus of integrated marketing Communication is to integrate all sources that deliver the outflow of communication from the firm to ensure the delivery of a clear and consistent message to target markets. The integrated communication concept, on the other hand, stresses on the dynamic integration between both inward and outward channels of communication.
This enables a consistent, mutually reinforcing and optimisation effort to make the firms plan and build its strategy. Finally, the integrated marketing communication of the firm is developed. This enlarges the appreciation of the role of communication to – (a) highlight its contribution to the value addition process of the firm and (b) enable the delivery of the value added with the help of a clear consistent message.
The Integrated Communication concept starts with the customer as a focus and recognises that his needs and wants are evolving and not static. It recognises that firms need to build their communication processes keeping in mind the three forces that are acting on consumer needs at all times.
These forces of Primary influences on consumer needs and wants are:
i. Seeking better value delivery for current wants through current products:
This is met by the firm’s ability to satisfy current consumer wants through current products in a better way. This often requires modification strategies only. The modification could be in production or distribution processes, product attributes or in carrying products uses.
ii. Seeking better value delivery for current wants through alternate products:
Alternate strategies are required when there are alternate ways of satisfying current wants which are developing or have developed. Technology usually builds up such threats. Kodak for example is worrying about the long-run threat from the recent invention of filmless camera. This is one of the biggest threats to the film business.
iii. Seeking better value delivery for new wants through new products:
New strategies are required for new emerging want opportunities in the market emerging from new innovations that the firm can offer. Such innovations could be the result of working closely with the customers or they could emerge from related or supporting industries, firm’s own R & D or by new people joining the firm or its competitors. The role of supporting industries and links between scientific people across firms in spurring innovations has been widely acknowledged.
(a) The national environment and available international resources.
(b) Forces within the firm to spur innovation, deliver 3 fits and manage the dynamics of competition and co-operation,
(c) With customers.
This can ensure that it is able to devise a competitive strategy that delivers customers additional value and gives the firm a long-term competitive advantage.
To build these linkages it:
(a) Needs to appreciate the determinants of competitive advantage especially in the national context the firm operates in.
(b) Needs to learn from internal practices of firms seeking excellence.
(c) Use tools of strategy building in a manner that is competitive strategy is delivered by activities that are consistent, reinforcing and optimum.
A good communication strategy builds channels that help the firm absorb information from the environment especially the national environment, enable it to ‘process’ the absorbed information within the organisation in such a way it can offer a unique delivered value to customers and finally communicate this value added to them in a manner that they can perceive it.
Marketing Communication – Planning and Strategy Inter-Relationship of Marketing Communication
Planning and Strategy Depend on Communication:
All three tasks of planning, communication and strategy formulation are interdependent. Communication, however, is the key tool they use. The role of communication within the firm nurtures and fosters the process of bottom-up planning. One of the advantages of such a process could be what Ries and Trout call “Bottom-up” marketing where one marketing tactic generates the necessary value to build a strategy around it.
When the same bottom-up communication happens in non-marketing departments along with an upgradation of skills, knowledge of techniques of production and understanding of customer needs it could lead to cost advantage, productivity increase or even innovation as in new product and process ideas. The advantages that “good communicator” organisations have are the ones crucial to attaining strategic positions and competitive advantage. Hence both strategy and planning depend upon communication.
Communication, Too, Should Germinate from Planning and Strategy:
Communication, that germinates from needs of planning and subsequent development of strategy enables the creation and delivery of additional value, lower cost or both. The answer, then, to the 5 W’s of communication (listed below) cannot be found without inputs from firms planning and strategy development process. These 5 W’s are – Who (source). What (message), Whom (audience), Which (channels) medium and with What effect.
Marketing Communication – The Role of Communication in Value Creation and Delivery
Communication has critical role to play in the new competitive scenario where global players have easy access to local markets and can deliver better value to the customer if the local firm has not kept itself abreast of developments in technologies, processes, marketing and changing nature of consumer demand. To safeguard its position the firm has to develop and nurture its channels of communication to enable it to anticipate and adequately meet these challenges.
Primary Influences on Consumer – The Basis of Communication Strategy:
This study of communication strategy begins by taking a dynamic view of the customer. The customer and his wants are not taken to be static which respond to give cues. Instead it is an exercise that recognises the involving nature of the customer and seeks to understand the influences working on him. Instead of using predetermined cues, it is itself in the process of seeking those cues that can help to comprehend the influences on the customer in better way.
To understand the primary influences on the customer we have to appreciate the factors which are the main influencers. These influencers are both internal and external to the customer. The internal influencer is the ‘inner drive’. For simplicity it is being shown as being expressed in two ways i.e. seeking better value and individuality and creativity. It is affected by the position of the customer in Maslow’s need hierarchy. Customers at the lower level of need hierarchy may express their individuality and creativity in a different way while seeking better value. The inner influencers form part of the customers private ‘self’.
Communication is the common thread that not only ties up the customers private ‘self with the ‘outside influencers’ but also has a role in linking the outside influencers with each other too.
The outside influencers are:
(i) Growth of knowledge and information
(ii) Technology and its ability to deliver products
(iii) The socialisation process.
The growth of knowledge and availability of information has an impact on the process of technology development. This creates not only the present products but also new products through efforts of firms. Technology influences the way customers fulfill their needs. This sometimes has social implications. Often these may be hidden influences.
While seeking better value is an inner desire of all customers, it is the individuality of customer which enables segmentation. All customers do not seek greater value in exactly the same way. They have their individuality of needs. Creativity is another important variable which imparts the element of dynamism to customer wants. This aspect makes the study of marketing management interesting.
Customers possess an ability that enables then to relate the ever-increasing knowledge and information in new and different ways. This creates the need for better products to satisfy current wants. This creative process can shape new wants as the customer is exposed to greater information, knowledge and technology possibilities in the socialisation process of course, some customers and firms may prefer status quo in varying degrees.
Such firms may be less exposed to the growing information and knowledge or may not be able to develop access to it. Organisational inertia may be a cause of this. Similarly, some customers may not be inclined to assimilate the new learning curve that consumption of new products may require. Others may not feel the need for doing so. Their response to the influencers may be slower or non-existent.
The influencers’ impact on the customer results in the emergence of the primary influencers for customer wants. These primary influences can be satisfied through present, new and alternate products.
We have seen above that the value seeking customer has three primary influences working on him.
a) Seeking better value delivery for current wants through current products i.e. the desire to satisfy the present needs and wants through present products in a better way,
b) Seeking better value delivery of current wants through alternate products i.e. alternate ways of satisfying present needs and wants.
c) Seeking better value delivery of new wants through new products. Here products have to be designed for fulfilling new and emerging needs and wants.
The value seeking customer re-shapes his current wants which can be satisfied with present or modified present products. These could also be satisfied through alternate products that satisfy the same want in a different way. Emerging or new wants, being different from current ones, are unlikely to be satisfied with present products or even their alternates.
The nature of these three primary influences give a new dimension to the firm’s dynamism. Firms which ignore the continuing nature of these influences are unlikely to hold loyalty of such customers who keep evolving their needs and wants based on new information and knowledge. To keep their loyalty the firm has to concentrate on the wants of the customer and develop and adapt its products to suit them. This may require different strategic choices.
For giving better value through present products, firms may need to rely upon modification strategies. The modification could be in product features and attributes or in production processes to give more efficiency and result in lower cost for customers. The quality of product could be improved and newer models designed to suit individual needs offered. The styling of the product could be improved to improve its functional use.
Even repositioning could be done to highlight those features which can give additional value but were not perceived by the customer in that manner. New or alternate distribution channels may be opened to make it more convenient for customers to access the product.
Technology fuelled by growth of knowledge could create alternate ways of satisfying current wants. Such threats could be faced more by firms in the knowledge based industries. Development of new software could make many old processes redundant. The use of computers could change delivery of banking services. Internet has opened many new possibilities. In the area of impact of technology Kodak, for example is worrying about the invention of the filmless camera and the bearing this could have on its future business.
The firm also needs to develop new products to meet the emerging wants of the customers. While the customer has many alternatives in terms of firms and countries offering products, the individual firm has to develop core strengths that can help build systems as well as structure that augments innovation. This process should form a part of the firm’s strategy. Innovation, often results from working close with the customer or from cooperation within the firm’s departments with a concerned focus for delivering better value.
It could also emerge from cooperating with related or supporting industries, firm’s own R & D as well as new people joining the firm. Even if a firm keeps track of competitors who have inducted new people, a study of their responses and processes could give a firm many new ideas. Links with scientific community, laboratories, universities and other research institution also helps the firm prepare itself for the challenge of change thrown up by the new and emerging wants of customers.
The firm and the customers view the changing nature of time differently. Customers view the future based on the three primary influences working on them. Firms have to understand these primary influences but prepare for their future using core strengths.
While the customer can choose products that are being offered by firms all over the world, the firm that has to offer has to produce these products within its own national context. Of course, it can set up production facilities overseas but even at the new location it will be working within a national context.
The national context, then, emerges as a critical variable in determining how firms address their future and its tasks. However, firms may choose a national context to work in.
Firms, therefore, to succeed have to plan to achieve a competitive advantage through present and future product offerings in a given/chosen national context.
Marketing Communication – The Relevance of National ‘Diamond’ and Mckinsey’s 7S Model in Communication Theory
Porter’s theory of competitive advantage shows that there are 4 determinants of competitive advantage within a nation or a national context. These form the “diamond”. The favourable factors (and therefore strategic choices before the firm) in producing the product are largely determined by the forces working along the ‘diamond’. Therefore, the first task of communication strategy is to build its communication channels around the forces working within the diamond to enable it to formulate winning strategies that can make it offer enhanced value to its customers.
The four determinants are:
a. Factor conditions.
b. Demand conditions.
c. Related and supporting industries.
d. Firm structure and nature of competition within an industry.
The ability of a firm to succeed within a national context depends on:
a) How is it able to seek information and build communication channels with the determinants of competitive advantage.
b) Process the ‘information’ received within the firm to formulate a value adding strategy. For doing this task it has to be understood how firms seeking excellence build their organisation strategy. The Mckinsey’s 7S Model illustrated here is a good beginning along with a study of excellence-seeking processes of successful firms.
c) Communicate the strategy with customers to enable them to perceive the value addition.
Marketing Communication – The New Model of ‘Communication and Strategy’
Keeping these tasks in mind the imperatives of the firm’s strategy building efforts can be summed up in Figure 14.7. Kotler, when discussing about the development of management thought, has remarked – In the 60’s “Theory Y” called on companies to treat their employees not as cogs in a machine but as individuals whose creativity can be released through enlightened marketing practice.
In the 70’s “Strategic Planning” offered way of thinking about building and managing company’s portfolio of businesses in a turbulent environment. In 80’s “Excellence and Quality” received major attention as new formulas of success. All of these are valued and inspire business thinking. In the 90’s many firms have acknowledged the critical importance of being customer-driven in all their activities. It is not enough to be product- driven or technology-driven … Success in 1990’s and beyond rests on a market and customer based view of business. “This analysis seeks to present such a view”.
Therefore it seeks to create a ‘fit’ between the firm’s activities and the customers emerging requirements. Firms that are able to generate this ‘fit’ or this match between product and market/customer are likely to build competitive advantage and achieve competitive success.
Figure 14.7 presents a customer-centric view of the market, the opportunities it presents as well as how the individual firm can develop its strategic responses. Each of the lines representing the boundaries of the concentric circles could represent channels of two way communication.
The first two concentric circles represent the interactive nature of customer wants and market opportunities. The last 3 concentric circles represent the three C’s which are the necessary ingredients of both communication and strategy building. These help develop the firm’s competitive response to the customers need and the market opportunities that they create.
Fig. 14.7. The Customer, Home Nation, Firm and Society’s Interaction during the Process of Value Creation
The area outside the concentric circle (firm’s interaction with society) will be discussed in point 4 below.
These 3 represent processes of strategy and communication.
These are:
1. Co-Operation:
(The first C and the area within the third concentric circle). The circle mainly represents External communication (communication with external world) to generate a ‘net inflow’ or information. This entails both working closely with sophisticated buyers (through understanding ‘home demand composition’ in the demand conditions) and developing communication channels around the determinants of national competitive advantage.
In fact, working closely with sophisticated buyers and trade association is so important that it needs separate attention. A good framework of understanding this process is through appreciating Porter’s National Diamond arid the implication it has for both the firm’s strategy development and communication strategy.
2. Focused Concern:
(The Second ‘C’ and the area within the fourth concentric circle) For successful strategy development two focal strength need to be developed by the firm in this concentric circle.
These are:
i. Internal communication (processing) – To internalise the interaction or “process” the inputs received. A good framework of understanding this process is through Mckinsey model and study of processes of firms seeking excellence.
ii. (Discrimination) – This implies the ability to sift the ‘wheat’ from the ‘chaff i.e., separate the relevant information from the irrelevant one. Then it should identify where the firm can add value. This needs a good understanding of the firm’s current strengths as well as realistic assessment of the strengths it can or needs to develop. It also implies an ability to identify the key activities critical for the firm’s competitive success and to focus on them.
The area of focused concern contains within itself the forces of both cooperation and competition which have to be managed with discrimination.
3. Competitive Response:
(The third ‘C’ and the area within the fifth concentric circle). This represents the area of execution of both strategy and communication with the customer (i.e., Net Outflow) – The firm develops the delivery system for its competitive response. The firm has two tasks here, (a) delivery value added (b) making the customer correctly perceive the value addition. Such communication of the value added to the customer when done makes the marketing communication meaningful.
(Net outflow is the term used here because inflow of information through distribution channels, salesmen, Market Research (MR) etc., also exist in this circle).
4. The above 3C’s represent the present processes of communication and strategy (whether formally planned or informally achieved). However, some unfulfilled tasks remain in the depiction of the three C’s. When the interaction between the firm and society generates competitive responses that are compatible with society’s long-term interests, the 4th C emerges.
Satisfying customer wants and serving long-run customer interests may not always be the same thing. Firms need to study the impact of their offerings on social processes, earth’s resources as well as look at other legal, ethical and moral issues. When a firm has anticipated these issues, it enables a competitive response that benefits from a compatibility advantage.
This offers the customers, firms, cluster, industry, nations and society the advantage of compatibility in their value seeking, value delivery and value creation processes. It ensures that conflicts that are reflected today through concerns for environment, decay in cultural values through influences of new behaviour patterns and lifestyles associated with ‘development’, ethical and legal issues are resolved by informal processes of firms and society before they can arise. The emphasis here is on tempering the growth of knowledge with the realisation of wisdom.
i. The First ‘C’ Co-Operation – Helping Firms, and Industry:
The firm, in today’s scenario of global competition, is likely to have its fortunes interlinked with the cluster, industry and home nation. Global market shares depend on competitive strategies built on the strength of a home nation’s competitive advantage. This competitive advantage is usually the result of cooperation and communication.
Cooperation – The New Challenge for Communication:
Porter’s study of competitive advantage of nations has thrown up a new challenge to firms and nations that wish to achieve competitive success. The challenge is one of cooperation. Firms can no longer fight shy of cooperating if they need to build up their own competitive strategy and their nations competitive advantage. Governments, it has been demonstrated, have a marginal role to play.
The dynamics of competition and cooperation has to be nurtured by domestic firms themselves in their quest for excellence and competitive strategy. In fact, Porter conclusively observes that the greater the degree of competition, the more conducive the environment for cooperation to generate innovative results.
Cooperation is essential to augment the firm capabilities. The consumer needs are not static but are empowered by the dynamism of the three primary influences. The firm has a national context, an internal structure and the option of building channels of communication that are backed by easy international flow of certain information and offerings. The firm has to adequately meet the challenge of change imposed by influences on consumer. For this it has to recognise the imperative of cooperation.
Often innovation that reshapes products and creates new products is the result of cooperation. Information plays a large role in innovation. Innovation is in both methods and technology. Innovation in methods involves, new production methods, new ways of marketing, identification of new customer groups etc. Organisational inertia is the biggest barrier to the possibilities of innovation.
For sustaining advantages the firm has to continually move earlier than its rivals. The ability of the firm to innovate has much to do with information sources available and consulted by it. Information that will be useful is that which is not sought or available to competitors, or information available to others that is interpreted in new ways. Sometimes it results from sheer investments in R & D and Market Research. Seeking information, that can help the firm respond to the primary influences working on the customer, implies cooperation. The cooperation is the new challenge for communication.
The National Diamond Implies Cooperation and Communication:
Porter states, “The mutually reinforcing activities of the diamond all conceal important channels of communication that add value, give competitive advantage and therefore marketing strengths. All these channels, therefore, contribute to both firm as well as marketing strategy”.
Further, he elaborates “Underlying the operation of the national diamond and the phenomenon of clustering is the exchange and flow of information about needs, techniques and technology among buyers, suppliers and related industries”.
Finally, he concludes that “Advantages throughout the diamond are necessary for sustaining competitive success in knowledge intensive industries. Advantage in every determinant is not a prerequisite but the interplay of advantage in many determinants yields self-reinforcing benefits that are hard to nullify and replicate.” This interplay is the result of cooperation.
Role of Cooperation in Firms Strategy Building:
The ‘diamond’ highlights the role of factor conditions, related and supporting industries and demand conditions. Among factor conditions, the advanced factors are critical in our analysis for they include modern digital data communication, educated personnel & university research institutes. The advanced factors are now the most significant factors to achieve higher order competitive advantages like differentiated products and proprietary production technology.
They have to be built by human resources and capital factors and may be difficult to procure in the global market. The U.S. stock of human skills and scientific experience in both computer hardware and software interact and cooperate to yield advantage not only in these industries but also related ones like medical electronics and financial services. The advanced and specialised factors reflect the firms capacity to absorb information, process and add value through its products, process and design. Therefore they reflect the cooperation, communication and innovation abilities of the firm.
Sometimes, the home base advantage itself can even be translated through a communication strategy to create an international competitive position.
Competitive advantage comes not only through using current factors but also through factor creation. It is firms (and not the governments) in most cases that indulge in factor creation that leads to factor advantage in industries. The Italians indulge in factor creation through cooperation by transfers of knowledge within extended families for there is strong family inter-linkage between operating firms in most of the industries.
Cooperation of working with buyers, suppliers and channels involves not only helping them upgrade and extend their own competitive advantage. Open communication with suppliers can give early access to new equipment, supplies and ideas that are critical for creating competitive advantage.
The Japanese case illustrates how working closely with suppliers with free information flows lead to superb service and rapid changes. The role of related industries in spurring innovation has been widely acknowledged and recorded. It is cooperation that builds channels of communication which lead to sharing technology, channels and buyers.
Similarly demand conditions are important for a firms success. Understanding buyer needs requires access to buyers, seeking their cooperation through building open communication between them and a firm’s top technical and managerial personnel. This interaction should help create an intuitive grasp of buyer circumstances. Again, firms that ‘cooperate’ and do not shy away from demanding buyers push a firm towards innovation.
However, working with them alone may unnecessarily drain resources or may not produce commensurate results. Ries & Trout call it as “Bottom-up” marketing . This tactic can be the basis of a winning strategy. The inability to understand the changing market place, customers and the need to provide competitive values has created a situation where some powerful US companies of the ’70s are struggling to remain profitable today.
ii. The Second ‘C’- Focused Concern:
The first task, while discussing focused concern, is to recognise that the area of focused concern contains within itself pressures of both cooperation and competition. It is like the brain bank of the firm which not only processes the received information but perceives the information in a way that is capable of translating itself through value added processes, techniques, product etc. The “discrimination” ability is the key variable here. The same information may be available to more than one firm, yet the response to the information can be different.
Therefore, the task of sifting the relevant information from the irrelevant is important. Viewing the relevant information in a different way is the next task. Moreover, the dividing line between cooperation and competition as well as managing its dynamics both within the firm and with the outside world needs discriminating ability.
A firm needs to be clear about what information to share with competitors, cluster and industry and what secrets to keep. This is the role of discrimination. Finally the firm has to decide how to optimise and reinforce activities in a consistent way. Discrimination, again, plays a role (though a different one) here.
iii. The Third ‘C’ – Competitive Response:
The firm’s strategy, as has been pointed out earlier, is a flow. What is the nature of this flow? How do the marketing and communication tasks flow from strategy? How and where do the various tools of strategy contribute to this flow? The discussion below will explore answers to these questions.
Delivering the 3 Strategic Fits Implies Using the 3 Cs:
Strategy building by the firm is not an event but a process. Understanding the importance as well as dynamics of this process results in competitive success. Every firm irrespective of size, location or position in the market is indulging in this process formally or informally. The advantage for formally acknowledging the process is that due importance can be given to certain key activities which were related as “informal” in nature and therefore left to the judgment of say the top management.
Lack of adequate feedback and data on these could lead to ‘safe’ or ‘in-between’ strategies which damage the ability of the firm to take a position in the market place.
The strategy building and communication tasks need to be understood together. For in a world based on communication, strategy building and execution both depend on (a) knowing where to build communication channels, (b) the ability to build them (c) their profitable use for inflow and outflow of desired information and response.
The ability of a firm to deliver better value than its competitors is determined not only by which activities the firm will perform and how it will configure individual activities but also-how activities relate to each other. Porter states that formulating a Strategy implies having three order of fits among activities of the firm. These “fits” are not mutually exclusive. The first order fit is simple consistency. This implies a simple consistency between each activity and overall strategy. The second-order fit occurs when activities are Reinforcing each other. The third-order fits goes beyond reinforcement to an Optimisation effort.
It is not difficult to see that 3 fits cannot occur without the 3Cs. Cooperation among the ‘skills’ of the ‘staff is essential for simple consistency, reinforcement and optimisation. Focused concern helps choose the activities which will be consistent, reinforcing and optimise results in terms of greatest value added at least possible cost. The strategy or competitive response is nothing but the 3-fits working in harmony with each other to create differentiation, focus or cost advantage.
Three competitive response alternatives in terms of Positioning (identified by Porter) need to be considered here. The 3Cs are interlinked in the execution of these strategic potions – variety based, needs based and access based positioning. Firstly, cooperation among the firm resources and focused concern leads the firm to identify and bring together a distinctive set of activities that can best produce particular products or services.
This implies that the firms product or services range need not be produced identically and there may be better ways of producing a subset of them through unique activities or activities done in a unique way. This is variety based positioning. Secondly, where groups of consumers express their individuality through different need, it is possible to focus concern on needs of a particular segment or group. Cooperation or bringing together of the firm activities can be done in such a way to serve the individuality of these needs best.
This competitive response is called need-based positioning. The third alternative is a variant of need based positioning. This clarifies those instances where needs may be same but the customers need to be accessed or reached in different ways. This may be due to customer geography, customer scale or anything that requires a different set of activities. A focused concern on ways of accessing them and a cooperation or bringing together of the firm activities to offer value added to them can give the competitive response called Access-based positioning.
Building the strategy of differentiation or focus or deciding on one of the three positioning alternatives involves a clear identification of the target audience, marketing objectives and subsequently the communication objectives. These two important tasks of marketing communication are thus done at the early stage of competitive response planning and delivery. The 3 fits are designed to deliver to the target audience the firms competitive response in a manner that meets the marketing objective. Execution of this process requires using the 3C’s.
Marketing Communication – Goals
The basic goals are no different from those for consumer products, i.e., creating awareness, interest, favourable attitude etc., leading to placing the orders.
The differences lie in – (a) the audience being technically qualified, it is also trained to evaluate, (b) emotional approaches as in consumer advertising will not work. Solid reason is required. The size of the audience is small. However, industrial advertising is visually getting more appealing.
Inputs:
We first need to know the segmentation variables, which are:
i. Descriptive – These include type of industry, geographic location, size etc.
ii. Operating – Refers to customer’s technological sophistication levels, past usage status, capabilities in operating technical areas, purchasing practices – formal organisation, Internal structure of power, nature of organisational relationships, policies, criteria and applied and the like.
iii. Situational – Urgency of purchase, specific application of the product, size of order or part of the order etc.
iv. People – Characteristics of decision makers, including buyer-seller familiarity, motivation, individual percepts and risk management strategies.
v. Technology – High end, how complex
vi. Price – High or what
vii. Channel – Just the buyer? Agent? Dealer?
viii. Information- In industrial purchases, buyers, in particular the decision makers seek and get a lot of information and go through prolonged processes for evaluating and making decisions. The same people, who at home are no different from others, in the work place are serious minded experts.
Unlike in consumer advertising, they react favourably only where there is transparent honesty and even understatement. At home they are relaxed while at work they are serious minded and devoted to their task.
The Manager of Crucible Steels in the US has summarised some basic principles to be followed in communications, which include:
(1) Information must be factual.
(2) Marketing communications must feature –
a. Applications of the equipment in actual use.
b. Technical data in support of claims/features.
c. Cost.
d. Availability – lead time needed.
e. Cost.
f. Economy and ROI.
g. Offer of more technical information.
h. Services in the field.
i. Demonstration (or visit to site where such equipment is in use or showing live over the company web, television monitors, and including tele-conferencing).
j. Name or address of person who would contact/who could be contacted for further information and progress.
Personal efforts need to be supported and integrated with other forms of communications. Such integrated communications have impact and results are favourable. In the US, John Morris did a study He interviewed over a hundred thousand technical people over 26 business/industrial product lines at over 30,000 locations and sites. His conclusive findings were that integrated marketing communications were more effective than just personal contacts and visits.
Media to be used would include presentations using latest equipment by an expert team to the client and his team, tele-conferencing if needed, technical literature, profile of the organisation and may be giveaways.
Marketing communications for technical and industrial products are a very small percentage of sales values.
