COMM 223 — Marketing Management
Chapter 12: Engaging Consumers and Communicating Customer
Value: Advertising and Public Relations
Based on: Armstrong, Kotler et al., Marketing: An Introduction, 7th Canadian Edition
Chapter Overview:
This chapter covers the promotional side of the marketing mix — how companies
communicate customer value through their promotion mix. It begins with the five promotion
tools (advertising, sales promotion, personal selling, public relations, and direct/digital
marketing). It then examines the rapidly changing marketing communications landscape, the
rise of digital and social media, and why companies must adopt Integrated Marketing
Communications (IMC) to deliver a clear, consistent, and compelling brand message across
all channels. The chapter then deep-dives into advertising — the four major decisions of
objectives, budget, strategy (message and media), and evaluation. It closes with public
relations — its role, impact, and major tools. The central thesis: companies must do more
than create customer value; they must clearly and persuasively communicate that value.
1. The Promotion Mix
A company's total promotion mix — also called its marketing communications mix —
consists of the specific blend of advertising, public relations, personal selling, sales
promotion, and direct and digital marketing tools that the company uses to engage
consumers, persuasively communicate customer value, and build customer
relationships. Building good customer relationships calls for more than developing a
good product, pricing it attractively, and making it available to target customers.
Companies must also engage consumers and communicate their value propositions,
and what they communicate should not be left to chance.
The five major promotion tools are:
Promotion Tool Definition Specific Examples
Advertising Any paid form of nonpersonal Broadcast, print, online, mobile, outdoor
presentation and promotion of ideas, advertising.
goods, or services by an identified
sponsor.
Sales Promotion Short-term incentives to encourage Discounts, coupons, displays,
the purchase or sale of a product or demonstrations, contests, events.
service.
Personal Selling Personal customer interactions by Sales presentations, trade shows, incentive
the firm's sales force to engage programs.
, customers, make sales, and build
customer relationships.
Public Relations Building good relations with the Press releases, sponsorships, events,
(PR) company's various publics by webpages.
obtaining favourable publicity,
building up a good corporate image,
and handling or heading off
unfavourable rumours, stories, and
events.
Direct and Engaging directly with carefully Direct mail, email, catalogues, online and
Digital Marketing targeted individual consumers and social media, mobile marketing.
customer communities to both obtain
an immediate response and build
lasting customer relationships.
Importantly, marketing communication goes beyond these specific promotion tools. The
product's design, its price, the shape and colour of its package, and the stores that sell it
— all communicate something to buyers. Thus, although the promotion mix is the
company's primary engagement and communications activity, the entire marketing mix
— promotion and product, price, and place — must be coordinated for greatest impact.
2. Integrated Marketing Communications
The New Marketing Communications Model
In past decades, marketers perfected the art of mass marketing — selling highly
standardised products to masses of customers, supported by mass-media
communication techniques. Large companies now routinely invest millions or even
billions of dollars in television, magazine, or other mass-media advertising. Today,
however, marketing managers face profoundly new marketing communications realities.
Three major forces are changing the face of today's marketing communications:
1. Consumers are changing: In this digitally connected, mobile age, consumers are
better informed and more communications empowered. Rather than relying on
marketer-supplied information, they use the internet, social media, and other
technologies to find information on their own. They can connect easily with other
consumers to exchange brand-related information or even create their own brand
messages and experiences.
2. Marketing strategies are changing: As mass markets have fragmented, marketers
are shifting away from mass marketing. More and more, they are developing focused
marketing programs designed to engage customers in more narrowly defined
micromarkets.
, 3. Digital technology: Sweeping advances in digital technology have caused
remarkable changes in the ways companies and customers communicate. The digital
age has spawned smartphones, tablets, brand websites, email, blogs, social media,
online communities, the mobile web, and much more. These tools have given birth to a
more targeted, social, and engaging marketing communications model.
The shift in media spending reflects this transformation. Growing at more than 18
percent annually, total digital ad spending surpassed TV spending worldwide in 2017.
By 2020, digital media was estimated to capture approximately 50 percent of all ad
spending. By far the fastest-growing digital category is mobile, which in 2018 accounted
for 75 percent of all digital ad spending. Large advertisers such as Nike, P&G, and
Unilever are moving toward a 'digital-first' approach. Unilever spends as much as 30
percent of its US$9 billion global marketing budget on digital media; in the U.S. and
China, digital accounts for closer to 50 percent. Adidas has abandoned TV altogether,
using only digital channels to reach younger consumers.
Despite the shift toward digital media, traditional mass media still capture a sizable
share of promotion budgets. Rather than the old-media model collapsing completely,
most marketers foresee a shifting mix of both traditional mass media and online, mobile,
and social media that engage more-targeted consumer communities in a more
personalised way. The key is to integrate all of these media to best engage customers
and communicate the brand message.
As the environment shifts, so will the role of marketing communicators. Many marketers
now view themselves more broadly as content marketing managers — creating,
inspiring, and sharing brand messages and conversations with and among customers
across a fluid mix of paid, owned, earned, and shared (POES) communication
channels.
Key Concept — The POES Framework: Paid media: promotional channels paid for by the
marketer (TV, radio, print, outdoor, online display ads, mobile ads, email marketing). Owned
media: promotional channels owned and controlled by the company (company websites,
corporate blogs, owned social media pages, proprietary brand communities, sales forces,
events). Earned media: PR channels not directly paid for or controlled by the marketer, but
included because of viewer/reader/user interest (TV, newspapers, blogs, online video).
Shared media: media shared by consumers with other consumers (social media, blogs,
mobile media, viral channels, word-of-mouth). Today's marketers leverage all four types in
combination.
The Need for Integrated Marketing Communications
The shift toward a richer mix of media and content approaches poses a problem for
marketers. Consumers today are bombarded by brand messages from a broad range of
sources. But all too often, companies fail to integrate their various communication
Chapter 12: Engaging Consumers and Communicating Customer
Value: Advertising and Public Relations
Based on: Armstrong, Kotler et al., Marketing: An Introduction, 7th Canadian Edition
Chapter Overview:
This chapter covers the promotional side of the marketing mix — how companies
communicate customer value through their promotion mix. It begins with the five promotion
tools (advertising, sales promotion, personal selling, public relations, and direct/digital
marketing). It then examines the rapidly changing marketing communications landscape, the
rise of digital and social media, and why companies must adopt Integrated Marketing
Communications (IMC) to deliver a clear, consistent, and compelling brand message across
all channels. The chapter then deep-dives into advertising — the four major decisions of
objectives, budget, strategy (message and media), and evaluation. It closes with public
relations — its role, impact, and major tools. The central thesis: companies must do more
than create customer value; they must clearly and persuasively communicate that value.
1. The Promotion Mix
A company's total promotion mix — also called its marketing communications mix —
consists of the specific blend of advertising, public relations, personal selling, sales
promotion, and direct and digital marketing tools that the company uses to engage
consumers, persuasively communicate customer value, and build customer
relationships. Building good customer relationships calls for more than developing a
good product, pricing it attractively, and making it available to target customers.
Companies must also engage consumers and communicate their value propositions,
and what they communicate should not be left to chance.
The five major promotion tools are:
Promotion Tool Definition Specific Examples
Advertising Any paid form of nonpersonal Broadcast, print, online, mobile, outdoor
presentation and promotion of ideas, advertising.
goods, or services by an identified
sponsor.
Sales Promotion Short-term incentives to encourage Discounts, coupons, displays,
the purchase or sale of a product or demonstrations, contests, events.
service.
Personal Selling Personal customer interactions by Sales presentations, trade shows, incentive
the firm's sales force to engage programs.
, customers, make sales, and build
customer relationships.
Public Relations Building good relations with the Press releases, sponsorships, events,
(PR) company's various publics by webpages.
obtaining favourable publicity,
building up a good corporate image,
and handling or heading off
unfavourable rumours, stories, and
events.
Direct and Engaging directly with carefully Direct mail, email, catalogues, online and
Digital Marketing targeted individual consumers and social media, mobile marketing.
customer communities to both obtain
an immediate response and build
lasting customer relationships.
Importantly, marketing communication goes beyond these specific promotion tools. The
product's design, its price, the shape and colour of its package, and the stores that sell it
— all communicate something to buyers. Thus, although the promotion mix is the
company's primary engagement and communications activity, the entire marketing mix
— promotion and product, price, and place — must be coordinated for greatest impact.
2. Integrated Marketing Communications
The New Marketing Communications Model
In past decades, marketers perfected the art of mass marketing — selling highly
standardised products to masses of customers, supported by mass-media
communication techniques. Large companies now routinely invest millions or even
billions of dollars in television, magazine, or other mass-media advertising. Today,
however, marketing managers face profoundly new marketing communications realities.
Three major forces are changing the face of today's marketing communications:
1. Consumers are changing: In this digitally connected, mobile age, consumers are
better informed and more communications empowered. Rather than relying on
marketer-supplied information, they use the internet, social media, and other
technologies to find information on their own. They can connect easily with other
consumers to exchange brand-related information or even create their own brand
messages and experiences.
2. Marketing strategies are changing: As mass markets have fragmented, marketers
are shifting away from mass marketing. More and more, they are developing focused
marketing programs designed to engage customers in more narrowly defined
micromarkets.
, 3. Digital technology: Sweeping advances in digital technology have caused
remarkable changes in the ways companies and customers communicate. The digital
age has spawned smartphones, tablets, brand websites, email, blogs, social media,
online communities, the mobile web, and much more. These tools have given birth to a
more targeted, social, and engaging marketing communications model.
The shift in media spending reflects this transformation. Growing at more than 18
percent annually, total digital ad spending surpassed TV spending worldwide in 2017.
By 2020, digital media was estimated to capture approximately 50 percent of all ad
spending. By far the fastest-growing digital category is mobile, which in 2018 accounted
for 75 percent of all digital ad spending. Large advertisers such as Nike, P&G, and
Unilever are moving toward a 'digital-first' approach. Unilever spends as much as 30
percent of its US$9 billion global marketing budget on digital media; in the U.S. and
China, digital accounts for closer to 50 percent. Adidas has abandoned TV altogether,
using only digital channels to reach younger consumers.
Despite the shift toward digital media, traditional mass media still capture a sizable
share of promotion budgets. Rather than the old-media model collapsing completely,
most marketers foresee a shifting mix of both traditional mass media and online, mobile,
and social media that engage more-targeted consumer communities in a more
personalised way. The key is to integrate all of these media to best engage customers
and communicate the brand message.
As the environment shifts, so will the role of marketing communicators. Many marketers
now view themselves more broadly as content marketing managers — creating,
inspiring, and sharing brand messages and conversations with and among customers
across a fluid mix of paid, owned, earned, and shared (POES) communication
channels.
Key Concept — The POES Framework: Paid media: promotional channels paid for by the
marketer (TV, radio, print, outdoor, online display ads, mobile ads, email marketing). Owned
media: promotional channels owned and controlled by the company (company websites,
corporate blogs, owned social media pages, proprietary brand communities, sales forces,
events). Earned media: PR channels not directly paid for or controlled by the marketer, but
included because of viewer/reader/user interest (TV, newspapers, blogs, online video).
Shared media: media shared by consumers with other consumers (social media, blogs,
mobile media, viral channels, word-of-mouth). Today's marketers leverage all four types in
combination.
The Need for Integrated Marketing Communications
The shift toward a richer mix of media and content approaches poses a problem for
marketers. Consumers today are bombarded by brand messages from a broad range of
sources. But all too often, companies fail to integrate their various communication
