international marketing 14 edition chapter16
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I n t e r n a t i o n a l M a r k e t i n g I n t e r n a t i o n a l M a r k e t i n g
Integrated Marketing Communications and International
Advertising
Chapter 16
1 4 t h E d i t i o nP h i l i p R. C a t e o r a
M a r y C. G i l l yJ o h n L . G r a h a m
McGraw-Hill/IrwinInternational Marketing 14/e
Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved.
16-2
What Should You Learn?What Should You Learn?
• Local market characteristics that affect the advertising and promotion of products
• The strengths and weaknesses of sales promotion and public relations in global marketing
• When global advertising is most effective; when modified advertising is necessary
16-3
What Should You Learn?What Should You Learn?
• The effects of a single European market on advertising
• The effect of limited media, excessive media, paper and equipment shortages, and government regulations on advertising and promotion budgets
• The communication process and advertising misfires
16-4
Global PerspectiveBarbie Versus MulanGlobal Perspective
Barbie Versus Mulan• Integrated marketing communications (IMC)
– Advertising– Sales promotions– Trade shows– Personal selling– Direct selling– Public relations
• Objective: successful sale of a product or service
• Availability of appropriate communication channels can determine entry decisions
16-5
Sales Promotions in International Markets
Sales Promotions in International Markets
• Sales promotions
– Marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation
– Short-term efforts directed to the consumer or retailer to achieve specific objectives
• In markets with media limitations the percentage of the promotional budget allocated to sales promotions may have to be increased
• Product sampling
16-6
International Public RelationsInternational Public Relations
• Public relations (PR) is creating good relationships with the popular press and other media
– To help companies communicate messages to customers, the general public, and governmental regulators
• Bridgestone/Firestone Tires safety recall
• Global workplace standards
• Building an international profile
• Corporate sponsorships
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Top 20 Global Advertisers ($ millions)
Top 20 Global Advertisers ($ millions)
Exhibit 16.1
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Top 100 Advertisers’ Global Spending ($ millions)
Top 100 Advertisers’ Global Spending ($ millions)
Exhibit 16.2
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Top Ten Advertisers (Russia and China – $ millions) Top Ten Advertisers (Russia and China – $ millions)
Exhibit 16.3
(A) Russia (B) China
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International AdvertisingInternational Advertising
1. Perform marketing research
2. Specify the goals of the communication
3. Develop the most effective message(s) for the market segments selected
4. Select effective media
5. Compose and secure a budget
6. Execute the campaign
7. Evaluate the campaign relative to the goals specified
16-11
Advertising Strategy and GoalsAdvertising Strategy and Goals
• Marketing problems
– Require careful marketing research – Thoughtful and creative advertising campaigns
► In country, regional, and global markets
• Increased need for more sophisticated advertising strategies
• Balance between standardization of advertising themes and customization
• Consumer cultures
16-12
Product Attributes and Benefit Segmentation
Product Attributes and Benefit Segmentation
• Different cultures usually agree on the benefit of the primary function of a product or service
• Other features and psychological attributes of the item can have significant differences– Cameras– Yogurt– Almonds
• Blue Diamond – Assumes that no two markets will react the same
► Each has its own set of differences► Each will require a different marketing approach and strategy
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Regional SegmentationRegional Segmentation
• Pan-European communications media highlights need for more standardized promotional efforts
• Costs savings with a common theme in uniform promotional packaging and design
• Legal restrictions slowly being eliminated
16-14
Global Advertising and the Communications Process
Global Advertising and the Communications Process
• If not properly considered, different cultural contexts can increase the probability of misunderstandings
• Effective communication
– Demands the existence of a “psychological overlap” between the sender and the receiver
• It can never be assumed that “if it sells well in one country, it will sell in another”
16-15
The International Communications Process
The International Communications Process
Exhibit 16.4
16-16
Legal ConstraintsLegal Constraints
• Comparative advertising
• Advertising of specific products
• Control of advertising on television
• Accessibility to broadcast media
• Limitations on length and number of commercials
• Internet services
• Special taxes that apply to advertising
16-17
Linguistic LimitationsLinguistic Limitations
• Language is one of the major barriers to effective communication through advertising
• Translation challenges
• Low literacy in many countries
• Multiple languages within a country
• In-country testing with the target consumer group avoids problems caused by linguistic differences
16-18
Cultural DiversityCultural Diversity
• Knowledge of cultural diversity must encompass the total advertising project
• Existing perceptions based on tradition and heritages are often hard to overcome
• Subcultures
• Changing traditions
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Media Limitations and Production and Cost Limitations
Media Limitations and Production and Cost Limitations
• Media limitations may diminish the role of advertising in the promotional program
• Examples of production limitations:
– Poor-quality printing– Lack of high-grade paper
• Low-cost reproduction in small markets poses a problem in many countries
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Media Planning and Analysis – Tactical Considerations
Media Planning and Analysis – Tactical Considerations
• Availability
• Cost
• Coverage
• Lack of market data
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Media Planning and Analysis – Tactical Considerations
Media Planning and Analysis – Tactical Considerations
• Newspapers
• Magazines
• Radio and television
• Satellite and cable TV
16-22
Media Planning and Analysis – Tactical Considerations
Media Planning and Analysis – Tactical Considerations
• Direct mail
• The Internet
• The New Social Media
• Other media
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Media Penetration in Selected Countries (per 1,000 persons)
Media Penetration in Selected Countries (per 1,000 persons)
Exhibit 16.5
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Top Ten Websites in Three Countries (visitors per month)
Top Ten Websites in Three Countries (visitors per month)
Exhibit 16.6
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Social Networking Goes Mobile(Percent of Respondents)
Social Networking Goes Mobile(Percent of Respondents)
Exhibit 16.7
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Campaign Execution and Advertising Agencies
Campaign Execution and Advertising Agencies
• Managed by advertising agencies
– Local domestic agency– Company-owned agency– Multinational agency with local branches
• Compensation
– Commonly 15 percent throughout the world– Some companies moving to reward-by-results
16-27
World’s Top Ten Advertising Agency Organizations
World’s Top Ten Advertising Agency Organizations
Exhibit 16.8
16-28
International Control of Advertising – Broader Issues
International Control of Advertising – Broader Issues
• Consumer criticism
• Deceptive advertising
• Decency and blatant use of sex
• Self-regulation
• Government regulations
16-29
SummarySummary
• An integrated marketing communications (IMC) program includes coordination among advertising, sales management, public relations, sales promotions, and direct marketing
• Currently companies are basing their advertising strategies on national, subcultural, demographic, or other market segments
• The major problem facing international advertisers is designing the best messages for each market served
16-30
SummarySummary
• The availability and quality of advertising media vary substantially around the world
• Advances in communication technologies are causing dramatic changes in the structure of the international advertising and communications industries