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This chapter starts out by telling the reader that there are many different options for the ways that businesses can get their message out to consumers. Through various forms of communication, firms are able to establish and build a relationship with their customers. We then find the model of communication process. This is a model that describes the way that we encode and decode everyday messages. For example, the person to initiate contact is called the sender, and the sender's message is encoded and sent to the receiver, who is able to decode and process the message. The receiver can then encode a message to send right back to the original source. Making sure that you are using the right methods of communication with your customers is absolutely essential.
In order to better reach consumers, many marketing researchers have begun to study the field of semiotics, which is studying how people convey certain messages. These studies will help businesses in the future to be able to form better relationships with their customers.
This chapter goes on to talk about the idea of channels. A channel is the way that a message travels from the sender to the receiver. There are many different channels that can be used by businesses. The main way that channels are defined is by either being personal channels, which would be direct selling, where the business actually gets directly in touch with the customer, or non-personal channels, which would be mass television advertising, or radio ads.
Another factor that is very important in the communication process is the field of experience that the receiver has. The field of experiences relates to the different activities that the receiver can personally relate to. This helps with the communication process.
One thing that definitely does not aid the communication process, however, is noise. Noise is all of the outside distraction which may prevent your message from getting properly decoded by the receiver. It is easy to see how problems could arise as a result of miscommunication related to noise.
After the message has been encoded, sent, received, and decoded, there is still are still more important factors in the communication process. For example, after the message has been fully received, the receiver now has the chance to respond to the sender. This is called feedback.
In order for a business to be effective, they must be sure that they are trying to communicate with the right customer base.
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In the next section of the chapter, several models are discussed within the response process. The first model discussed is the AIDA model, which represents the different steps that must be taken by a sales person in order to successfully attract the buyer. The hierarchy of effects model shows what kind of thought processes go on with the buyer from the point at which they first get the message to the point where they finally purchase the product. The innovation adoption model displays all of the steps that a consumer must go through before a product becomes a part of their everyday lives. The final model is the information processing model. This model describes the communication process as if it is just like an advertisement; how can the consumer be persuaded?
The chapter then goes on to discuss the standard learning model, which consists of the three steps that the consumer must go through to purchase a product. First, the consumer must learn about the product, which will in turn make the consumer feel a certain way, and eventually the consumer will do what the business wants, which is buy the product. This resembles the dissonance/attribution model, which goes in the opposite direction as the standard learning model, in that the steps are do, feel and learn. This model is used when the consumer has a choice to make between two products.
The low-involvement hierarchy relates to the way a consumer will react in a situation where there is very little involvement in the purchase decision. Advertising plays an especially important role here.
Yet another consumer model is then discussed in the chapter. The integrated information response model is a model that combines the traditional and the low-involvement response. Different strategies are used by the marketers, depending on whether the product requires low involvement or high involvement.
The involvement concept is then discussed. This idea states that the level of involvement that a consumer has in buying a product will come from of several factors, including person factors, situational factors and object or stimulus factors. The Foote, Cone and Belding grid goes on to describe this process further.
The next idea discussed in the text is cognitive responses. These are the actual thoughts that go through the consumers mind when he or she is seeing an advertisement for the first time. If all goes well for the marketer, these responses will eventually lead to the consumer purchasing the product being advertised. The response that the consumer has to seeing an advertisement can either be positive or negative. The positive response is called source bolsters, the negative is referred to as source derogations. These reveal the consumers real opinions about the product. Attitudes about the product are also considered.
The last ideas in this chapter are about the elaboration likelihood model. This is a model that tracks persuasive communication between the marketer and the consumer, attempting to show the processes that a consumer goes through before actually making a purchase. There can be a central route to persuasion, where the consumer is quite motivated to find out more about a product, or the peripheral route to persuasion, where the consumer lacks a great deal of motivation to find out more about a product.
This chapter starts out with the persuasion matrix. This matrix helps marketers find out which elements are the most important when trying to reach the consumer. Many different variables are considered when making this analysis of the consumer. Some of the factors under consideration are message presentation, attention, comprehension, and behavior, among others. Each one of these variables is individually scrutinized by the marketers to find out exactly what mix of each variable should be used to make the best contact with the consumer.
One problem that some marketers might run into is the fact that they lack credibility, which is expressed as the extent to which the consumer trusts the advertisement. This process comes to a culmination with internalization, which is the overall process by which the consumer either believes or does not trust the advertising message being conveyed accurately.
A source that starts out as not being very credible has a chance to build up its credibility with time, this is known as the sleeper effect. The attractiveness of a product is also very important. Three main factors go into attractiveness; similarity, familiarity and likability. All of these factors are important, and they are all taken into consideration by the advertisers.
The chapter then goes on to discuss the idea of celebrities endorsing products. There are two main problems that advertisers run into when they have a celebrity spokesperson. One is that the celebrity may actually overshadow the product. Another problem is that the consumer knows that the celebrity is getting paid for their endorsements, therefore, they lack credibility.
Another potential area of distress when hiring a celebrity to endorse your product is the celebrity's behavior in public. If your spokesperson gets in trouble with the law, that does not look good for your product. It is for this reason that advertisers must be sure the celebrity is trustworthy and responsible.
The book then goes on to discuss the idea of source power. This is the idea that a sender actually has some sort of power over the receiver because he is able to administer rewards or punishments. This power makes the receiver more compliant with the requests of the sender.
The next section of the chapter goes into detail about the structure of the message. When the strongest selling points are presented at the very start of the advertisement, it is known as a primacy effect. When a long, complicated message is being send, the order and presentation of the message can be the difference between the receiver purchasing you product or not.
There are many different styles that can be used when describing a product. A one-sided message mentions only the positive aspects of a product, while a two-sided message mentions both the positive and negative points about a product.
There are a variety of ways to try to reach the consumer with your advertisement. One is through the use of comparative advertising, where you are basically putting your product in the spotlight against another product, and telling the consumer why your product is superior to the competitions'. Advertisers can also sell products by implying that there is some sort of fear or danger associated with not buying the product. This is known as fear appeal. On the opposite end of this spectrum are humor appeals, which are trying to use humor in your advertisement to attract the consumer.
The last factor to be considered by the advertiser is what type of channel should be used? Should the advertisement go on the radio, or television to promote the product? Should it go on a bus or a billboard? These are all very important decisions that have to be made. The influence that the channel has on the consumer is known as the qualitative media effect. The last problem that a marketer might run into is the problem of clutter, which is the saturation of the market with many ads.
This chapter deals with objectives that should be established by a company about budgeting and promotional programs. The chapter starts out with a terrific example about how Foster's lager was able to set specific objectives, and have effective sales growth, with a smaller advertising budget than many of its competitors. Having previously established objectives also makes for smooth sailing during the whole promotion process.
The book goes on to talk about marketing objectives. These are the short term targets for the company, for example, a good objective for a beer company would be to raise profits by 10% in the 25-32 year old segment of the market. Good marketing objectives are not only measurable, but also quantifiable. They must also be realistic, as well as feasible.
Different aspects of the IMC process are known as integrated marketing communications objectives. They are based on delivering the right message to the right audience.
Many managers use sales as the sole objective by which to measure the success of the company. This is not necessarily the best way to go about establishing objectives, because many different aspects of the business are included when talking about sales. The advertising and promotions can only do so much alone. Other factors are very important as well, such as technology, competition, and product quality, just to name a few.
The idea that increasing the amount of money spent on advertising will not necessarily impact sales immediately by that same amount is known as the carryover effect. The carryover effect helps to establish an even stronger connection between advertising and sales.
Just like any other department, advertising and promotion must set specific objectives for themselves. This can be done by setting up a pyramid of different marketing objectives. For example, the bottom objective might be "Let's make sure that 95% of the market is aware of our product." The highest objective might be something to the effect of "Let's have at least 7% of our customers repurchasing our product consistently."
Promotional planners are the people in a company who set objectives to match up advertising and promotion, along with sales objectives. This can sometimes be a very hard and demanding job.
A report prepared in 1961 by Russell Colley discusses the DAGMAR model. This approach involves an actual communications task for the company. Several different factors are taken into consideration when using the DAGMAR model, including comprehension, awareness, and conviction.
It is very important that a business have measurable and short-term objectives. One of the objectives that can be measured by a business is benchmark measures. It is by using these benchmarks that one can actually discern whether or not a promotion was successful. Some criticisms of DAGMAR include problems with the response hierarchy, practicality and cost.
Yet another opinion is that zero-based communications planning is what should be used when building a successful IMC campaign. This is the idea that you should look at tasks individually, and see to what extent each task must be completed.
When creating a promotional budget, several key factors must be considered. How much money should be allotted to each department? Should more money be spent on radio advertising or TV advertising? Two factors that are very important in establishing a promotional budget are contribution margin and marginal analysis. Contribution margin is the difference between the variable cost the company has, and the total revenue they have generated. Marginal analysis is graphing your sales against your profits and gross margin. It can be quite an effective tool.
There are many different methods to allocation resources for the company budget. Top-down approaches establish how much total money will be allotted, and then works its way down. The affordable method is used by many small firms. It helps businesses determine how much money should be allocated to each different department. Arbitrary allocation is the opposite of this strategy, because money is virtually thrown around a company with no specific standards. The percentage-of-sales method may also be used to allocate the company budget.
If the company chooses not to establish their own allocation of resources, they can just look at their competitors percentage-of-sales expenditures, and copy them. This is called the competitive parity method. Return on investment is another budgeting method where the advertising and promotion department would expect a certain return on each dollar spent.
As opposed to the top-down approaches mentioned above, some companies use build up approaches. Implementing this sort of approach takes time, and many different factors must be considered. Isolate objectives, determine tasks required, and estimate required expenditures are just a few of the steps that must be taken.
These approaches tend to be more quantitative, using more statistical analysis to determine the contribution of advertising to sales.
When allocating the budget of a company, many factors must be considered, including market size, potential, and organizational characteristics. All of these factors play important roles in the IMC process.
Measuring the effectiveness of your marketing campaign is very important. There are several key reasons that a business might have to measure effectiveness of advertising, including avoiding costly mistakes, and evaluating alternative strategies. There are also arguments that can be made not to measure advertising effectiveness, including high cost, research problems, and disagreement about what should be measured.
When measuring effectiveness, several different factors can be tested. For example, you can evaluate your source factors, to see if maybe you want to switch your spokesperson. Areas like message variables and media strategies can also be tested. How much effect one form of media will have on someone compared to the same message in a different form of media is known as the vehicle option source effect.
Before a campaign is started, pretests are done to measure campaign effectiveness. Once the campaign has come to an end, posttests are conducted as well to find out the success of the promotion.
There are a variety of tests that can be conducted. Laboratory tests are more controlled because you manage the experiment in a controlled environment. Field tests can also be conducted. These tests are less controlled, because all of the variables are independent. If there is a lack of realism about how good a product or a campaign really is, a testing bias can occur.
Very early on in a campaign, some consumers may be tested to find out what their initial reactions to the product or advertisement are. This is known as concept testing. Focus groups are one example of concept testing taking place.
To find out what is the best way to present a commercial to the public, many companies now do testing on their commercials before they are actually ran on television or the radio. Testing methods include comprehension and reaction tests, or consumer juries, which give opinions on the commercials they are seeing. This method is partially flawed because the consumer may become too self important to be able to give an objective judgment about the ad. Other problems that could possibly occur are a halo effect, and limited number of ads that can be evaluated.
Once ads are finished, many different tests can be run to find out how effective they will be. Portfolio tests are used to find out what a participant remembers from the ad that they have just seen. Readability tests find out how much of what the consumer has read has actually been comprehended. Dummy advertising vehicles may also be used here.
Theater tests are used to have participants actually view new pilots of potential television programs. The participant's reaction is very important in this form of testing. The company must pay close attention to how interested the participant seems to be with the show, and how much the participant can remember after he or she has seen it once or twice.
On-air tests refer to the program actually making it on to television in certain test markets. After the show has gone on television, the company has access to day-after recall scores, which contain valuable information about your program.
Physiological measures can also be used to see what a participant thinks of a new show or commercials. Physical characteristics are studied, such as pupil dilation, eye tracking, and brain waves, which are taken from the skull and determined by electronic frequency. Inquiry tests, recognition tests and split-run tests can also be used to measure a commercial's effectiveness.
Recall tests are used to find out how much a participant remembers about a print ad that they have seen. This is helpful in assessing the ad's impact on memory. Some other, less popular testing methods are diagnostics, comprehensive measures, test marketing, and single-source tracking studies. Tracking studies can be used to measure the effectiveness of the ad in relation to the participant's recall, interest, and attitudes.
In order to have an effective test, you must use both pretests and posttests, understand and implement proper research, and use a consumer response model. Testing the effectiveness of an advertisement is quite a valuable tool.