International Marketing Communication - Past Paper - Winter 2024/2025 PDF

INTERNATIONAL MARKETING COMMUNICATION WINTER SEMESTER 24/25 PROF. DR. ANNA GRIMM [email protected]...

INTERNATIONAL MARKETING COMMUNICATION WINTER SEMESTER 24/25 PROF. DR. ANNA GRIMM [email protected] INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  GENERAL Advanced module (> semester 3!) Examination: 50% written exam, 50% INFORMATION group work / case studies in course Please form “Working groups” of 4-5 people for this course in the next break The written exam will be a mix of multiple choice, Would you like to pass this course fill in and interpretative questions and will take with a good grade? place on the 13.01.25 – more info will follow in Be present and actively participate one of the later session in the discussions All teaching materials (©) can be found in Be a team player Ask if something is unclear – moodle everyone benefits from it! INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 2 AGENDA FOR THIS COURSE 1. Let's get started: Definitions and Delimitations of Terms 2. The Marketing Communication Process 3. Culture and its importance for Marketing Communication 4. International Marketing Communication & Branding: Standardization vs. Differentiation? 5. The Marketing Communication Mix - reflected internationally 6. Relationships in the Communication Mix and Integrated Campaign Development 7. Psychological Theories on the Impact of Communication 8. Campaign Evaluation: How to measure Communication Success? 9. Connecting the Ps: Interweaving of Communication and other Marketing Aspects INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm Let‘s start with watching Youtube Videos about sweets (always a good idea…) Differences? Similarities? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm Do you prefer pizza to sweets? Differences? Similarities? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  1. Let's get started: What is communication? Definitions and What is a market? What is marketing? Delimitations of What is marketing communication? Terms INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 6 WHAT IS COMMUNICATION? A bit of theory to start with. Communication may be defined as giving, receiving or exchanging information, opinions or ideas by verbal or nonverbal signals (facial expressions, gestures, language, tonality, written word, visual means...) Signal Sent Signal Received Sender Encoder Channel Decoder Destination Message Message Noise? Shannon and Weaver Model of Communication, 1949 Communication is the process of conveying information to others and requires six elements: a source, a message, a channel of communication, a receiver and the processes of encoding and decoding. INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm What is missing in the Shannon and Weaver Model of Communication? Feedback Effect? Signal Sent Signal Received Sender Encoder Channel Decoder Destination Message Message Noise? Interpretation Communication Context INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm WHAT IS COMMUNICATION? More than just sending and receiving. Provided information and communication context determine interpretation of communication Elements of the communication context are on the one hand personal factors (e.g. prior knowledge, motives, attitudes, emotions etc.), on the other hand situational factors (e.g. target structure, roles, environment...) Interpretation determines effect / feedback - consciously and unconsciously! Stop Stop looking looking at your at your phone! phone! Vs. More about that in chapter 7 of this course! INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm DISCUSS WITH A PARTNER AND BE PREPARED TO GIVE A STATEMENT: Is it possible not to communicate at all? Is a nod of the head as much a part of communication as the answer "Yes."? Does the consumption of advertising constitute a communicative act? Does communication only take place when recipients of a message interpret it correctly? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm WHAT IS A MARKET? A market is defined as the (1) sum total of all the buyers and sellers (2) interacting (3) regarding a defined product or service (4) directly or indirectly in (5) the area or region under consideration. The area may be the earth, or countries, regions, states, or cities. The value, cost and price of items traded are as per forces of supply and demand in a market. The market may be a physical entity or virtual. It may be local or global, perfect or imperfect. Let’s discuss: Does this product have one or several markets? What is the market? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm WHERE DOES THE MAGIC HAPPEN HERE ? (AKA: WHERE IS COMMUNICATION? BETWEEN WHOM?) Communication / Information Delivery of Product / service Interaction Payments Sellers Buyers Feedback to provider / information Market INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm WHAT IS MARKETING? American Marketing Association (2017) Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. Kirchgeorg, M. (2018, translated): The basic idea of marketing is the consistent orientation of the entire company to the needs of the market. Nowadays, it is undisputed that in highly competitive markets, the needs of the customers must be at the center of corporate management. Marketing thus represents an entrepreneurial mindset. Furthermore, marketing is an entrepreneurial task whose most important challenges include recognizing market changes and shifts in needs in order to build up competitive advantages in time. INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm RECAP: THE MARKETING MIX – WHO KNOWS A P? PRODUCT PROMOTION PLACE PRICE Design, Technology Advertising Pricing Strategy, e.g. 4P Usefulness Branding Channel skimming, penetration, Convenience Public Relations Inventory value based etc. Value Corporate Identity Logistics Discounts Quality Personal Selling Distribution Bundling Packaging Direct Marketing… Credit Terms Services… PHYSICAL PEOPLE PROCESS EVIDENCE Uniformity of offering Employees Management 7P Service delivery Facilities Organisation culture Service consumption Infrastructure Customer service (Espcially important to Service delivery orientation service industries) INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm MARKETING COMMUNICATIONS – BACK THEN AND CHANGES In the past, marketing communication was primarily understood as the one-sided communication of a company to a group of consumers (via mass media) with the aim of stimulating them to consume in the short-term. 1950 1960 1970 1980 1990 2000 2010 Development of Marketing Communication 1950 1973 1988 2021 INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm Source: Fuchs (2014) Management der Marketing-Kommunikation WHAT HAPPENED TO THE COMMUNICATION ENVIRONMENT SINCE THE EARLY DAYS OF MARKETING COMMUNICATION? What happened since then? More and more competition on an increasingly global market Fragmentation of target groups Differentiation and cross-linking of channels (i.e. more media) Increased understanding of the psychology of the consumer decisions Differentiation of communication targets Consumer empowerment  two-way communication etc. INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm AN EXAMPLE: WITH WHOM DOES A COMPANY HAVE COMMUNICATIVE RELATIONS? (Potential) Customers Politics Employees (Potential) Suppliers Multipliers Distributors/ Retailers Neighbors etc. Shareholders Please discuss: Which of these is "marketing communication"? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm ATTEMPT OF A MODERN DEFINITION OF MARKETING COMMUNICATION Marketing communications are a management process through which an organization engages with its various audiences. By designing and conveying messages that are of significant value to different audiences through suitable (media-)channels, they encourage these audiences to offer cognitive, attitudinal and behavioral responses (=communication objectives). Evaluating and acting upon these responses is as much a part of marketing communication as the prior analysis of the respective communicative environment. Defining and Setting appropriate Designing and Evaluation of understanding communication conveying of responses target audiences objectives respective messages INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  Which channels do customers use to come into contact with brands and companies? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 20 REMINDER: CUSTOMER JOURNEY MAPS Customer Journey = Defining the customer decision Customer Actions process from being aware of a specific good, service or company to go through with purchase and post- purchase behaviour including various touch points in Touchpoints between Customers Emotions Customer Journey Maps (also “Touchpoint Maps”): Document customer journey visually  illustrate Departements Involved customers’ processes, needs, and perceptions throughout their relationships with a company; tightly connected to customer experience  tool for Opportunities / Gains understanding how to add value to the customer Barriers / Pains Which variables, factors and steps are included in a Customers Motives customer journey map depends heavily on the company's goal, product, etc.! Business Goals Pursued INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm ELEMENTS OF A CUSTOMER JOURNEY MAP – WHAT IT SHOULD INCLUDE TO INCREASE CUSTOMER VALUE Source: Forrester Research, Inc. 2010 (http://crowdsynergy.wdfiles.com/local--files/customer-journey-mapping/mapping_customer_journey.pdf) INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm HOW TO MAP THE CUSTOMER JOURNEY AWARENESS INTEREST CONSIDERATION DECISION EXPERIENCE / Need Recognition Information Evaluation of Purchase Decision VALUE Search Alternatives Post-Purchase Touchpoints Customer Needs Pains Design a Customer Journey Map for a Gains product of your choice! Customer Perceptions / Feelings INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm A 10 MINUTE CUSTOMER JOURNEY ANALYSIS: TOUCHPOINTS WITH MARKETING COMMUNICATION Vedika (25, business student) buys a new product / service (choose for yourself, which one) Please brainstorm in your team: Through which channels could she have come into contact with which marketing messages before making her purchase decision? Together with your team, design a simplified customer journey map for your product (see Miro Board template). INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm THE MARKETING COMMUNICATION MIX (More about it will follow later!) ADVERTISING PUBLIC RELATIONS SALES DIRECT & SPONSORING PROMOTION MARKETING SOCIAL MEDIA & PERSONAL TRADE FAIRS & WORD OF MOUTH SELLING EVENTS INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm INTEGRATED MARKETING COMMUNICATIONS (IMC) With the increasing complexity of the communicative environment, the planning aspect of marketing communication became more and more important, the synchronization of different messages on different channels more and more strategic American Association of Advertising Agencies (1989) - Definition of IMC THE WHOLE IS GREATER A concept of marketing communications planning that recognizes the added THAN THE SUM OF ITS value of a comprehensive plan that evaluates the strategic roles of a variety PARTS. Aristotle of communications disciplines, e.g. general advertising, direct response, sales promotion and public relations – and combines these disciplines to provide clarity, consistency and maximum communication impact […] meaning the individual efforts are mutually reinforcing with the resulting effect being grater than if each functional area had selected its own targets, chosen its own message strategy, and set its own media schedule INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm Image Source: Wikipedia „INTEGRATION“ OF MARKETING COMMUNICATION? Functional Message Media Integration Stakeholder Integration Integration Integration of Timing Integration Promotional tools may Aka: Image integration / Co-ordinating message Timing messages on..refers to the way that all complement each other creative integration  distribution in different media channels so they support stakeholders (employees, – each tool has other Ensuring consistency of channels to optimize the each other and reach suppliers, customers etc.) strengths and messages / tonality within effectiveness of marketing potential customers at cooperate to communicate weaknesses along the and across different types of communications (Studies different junctures, a shared understanding of various stages of marketing communications show: Consumers learn more depending on when they the company's key purchase decisions. IMC to transfer brand identity. quickly when exposed are most receptive to messages and values. aims to combine them in This facilitates brand to messages via different different types of message an ideal, synergetic awareness and visual media.) or on the consumer's manner. memory. readiness to buy INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  A little wrap up: Could someone present their customer journey from last time? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 28 „INTEGRATION“ OF MARKETING COMMUNICATION? Functional Message Media Integration Stakeholder Integration Integration Integration of Timing Integration Promotional tools may Aka: Image integration / Co-ordinating message Timing messages on..refers to the way that all complement each other creative integration  distribution in different media channels so they support stakeholders (employees, – each tool has other Ensuring consistency of channels to optimize the each other and reach suppliers, customers etc.) strengths and messages / tonality within effectiveness of marketing potential customers at cooperate to communicate weaknesses along the and across different types of communications (Studies different junctures, a shared understanding of various stages of marketing communications show: Consumers learn more depending on when they the company's key purchase decisions. IMC to transfer brand identity. quickly when exposed are most receptive to messages and values. aims to combine them in This facilitates brand to messages via different different types of message an ideal, synergetic awareness and visual media.) or on the consumer's manner. memory. readiness to buy INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  Situation and competitor analysis Possible communication objectives 2. Defining the target audience The communication message: Identification of The Marketing needs, benefits and USPs Communication Creativity tactics and delivering reasons to Process believe Budget setting & campaign planning How it works in practice: Client-Agency- Relationship INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 30  THE STRATEGIC MARKETING COMMUNICATION PROCESS Evaluation Quantification of the effect of the communication measures in Situational Analysis relation to the SMART objectives  basis for further measures. Reflection of all internal and external organizational information (Note: especially in an IMC strategy difficult, but essential). that is relevant to communications and marketing activities, e.g. communication infrastructure, by tools such as competitive Execution (+continuous monitoring /reaction) analysis, organizational SWOT etc. During the execution of the planned communication measures, it is essential to constantly monitor the 7 1 Setting Communication Objectives reactions of the audience and, if necessary, respond (two-way communication) or adapt previous steps Definition of SMART cognitive, emotional and behavioral 6 2 communication objectives, e.g. information (brand awareness) or persuasion (purchase/switch); usually Channel-Selection & Budgeting 5 3 derived from corporate objectives Integrative definition of the marketing communication mix (i.e. communication tools 4 as well as specific communication channels) Definition of Target Audience and definition of a budget structure Demographic and psychographic definition of the target Design of Message(s) audience for defined goals and collection of relevant information on the status quo (e.g., attitudes, purchasing Design of creative and convincing messages habits, media habits) for further steps resonating needs of the respective target audience (+ Pretesting, if applicable) INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  What occasions can you think of when a company communicates? e.g. “Specific taxes are to (Potential) be increased – companies Customers want to prevent this" Employees Politics (Potential) Suppliers Multipliers Distributors/ Retailers Neighbors etc. Shareholders e.g. “The current quarterly figures are in and don't look good" INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm SITUATIONAL ANALYSIS Evaluation Situational Analysis 7 1 Execution (+continuous monitoring /reaction) Setting Communication Objectives 6 2 5 3 Channel-Selection & Budgeting 4 Definition of Target Audience Design of Message(s) INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm THE SITUATIONAL ANALYSIS: CHELLENGE = Detailed analysis of all internal and external organizational information that is relevant to communications and marketing.  Problem: That's a heck of a lot of information! The greatest challenge in the situation analysis is therefore the identification of relevant information for the communication purpose and the determination of the right level of information depth In the case of a holistic communicative positioning, the situation analysis can be equated with a strategic analysis of the entire business In the case of more specific questions (e.g. launch of a new product variant), a corresponding holistic market and company analysis serves as an information basis and individual aspects are examined in more detail Type of information to be collected Communication Purpose / Task Level of detail of the information Tools used for analysis defines INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  Imagine you've founded a start-up for healthy Feel free to type snacks and want to go to it into the chat! market with it – what information might be helpful beforehand? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm THE SITUATIONAL ANALYSIS: POTENTIAL COMPONENTS company vision, strategy and goals company performance: sales, market shares, customer retention etc. status quo of current products and services There are several tools that can help capture and customers perspective on service, pricing etc. analyze one or more of these aspects, for example: current customers: demographics, SWOT Analysis psychographics Competitive Analysis competitor analysis: products, services, sales, marketing, competitive advantage… PESTLE Analysis supplier and distribution structure etc. strengths, weaknesses, opportunities, threats external and internal environment: political, We now want to take a closer look at the “5C” method economical, social, technological, legal, natural environment etc. INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm THE SITUATIONAL ANALYSIS: THE 5C FRAMEWORK = Good method to get an overview of the business and get a feeling for decisive competitive advantages Company Customers Collaborators Products Total available market and Serviceable Partners & investors (Sustainable) Competitive Advantage available market Suppliers & distributors Goals Current target audience Brand Customer motivations & behaviors Communication channels Customer perceptions Competitors Climate / Context Established & emerging competitors Political & legal environment Their strengths and weaknesses Economical & Technological environment Their marketing and strategies Natural environment Their weaknesses and capability gaps INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm THE SITUATIONAL ANALYSIS: POTENTIAL QUESTIONS TO ASK FOR THE 5C FRAMEWORK Company Customers What types of products/serviced does your company sell? What/who is your Total Available Market (TAM), who your Serviceable Available How are they differentiated from the competitors? Market (SAM)? So which target customer buys your products? What types of products do they usually buy? Does your product/service have any competitive advantages? What’s the behavior of your target customers on your website/in your shop? Is your brand memorable and unique? Why? How do the customers come to you? How can you make your business better than competitors? Do you have repetitive customers? How are they impacting your business How do the people perceive the image of your company? model? What are your 1,3, and 5-year goals for your business/product How are purchases distributed over the year ? line? Are your customers rationally or impulsive? How would you invest 10,000 € What is the motivating factor behind the purchase of your customers? Is it In which fields would you invest extra money, where would product benefit, uniqueness, quality, price, convenience, or something else? you cut? How/where does your customer get the information about your product? What channel do you use to communicate with your customers? Hard to answer those questions? Perform a SWOT analysis! What are the most common issues/complaints that your customers do? What are the things that your customers appreciate? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm THE SITUATIONAL ANALYSIS: POTENTIAL QUESTIONS TO ASK FOR THE 5C FRAMEWORK Collaborators Competitors Do you have a partner that helps run the company / daily What are your direct, emerging, and established operations? competitors? Do you have investors or stakeholders? What other products do your competitors offer that you Who creates or supplies the products you sell? don’t? Who is your shipping provider? What are their biggest strengths and weaknesses? Who processes your payments? How are they getting a competitive advantage over you by Who provides your commerce platform(s)? using which strategies? Who handles your inventory or warehouse operations? What are things that you can’t do what your competitors are doing? Do you have anyone (agency? freelancers=?) helping with marketing or content creation? Do you have a competitive advantage over competitors? Is there anyone else that I work with on a regular basis? What is the target audience of your competitors? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm THE SITUATIONAL ANALYSIS: POTENTIAL QUESTIONS TO ASK FOR THE 5C FRAMEWORK Climate / Context Are there any new or proposed laws or regulations that may affect my business? If so, how do I plan to address them? Are there any social trends that may affect the things that people buy or the way people buy them? Are there any economic trends that might affect customer shopping behaviors? Are there any new or emerging technologies that may change the way my customers act or the way my business operates? What sorts of things or opinions are becoming popular or unpopular? Is your company sustainable? (In terms of business model and ecologically sustainable?) Hard to answer those questions? Perform a PEST analysis! INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm HANDS ON! LET‘S PERFORM A 5C ANALYSIS Step 1: You will be randomly divided into groups of 3-4 people. Each group is randomly assigned a "C". Step 2: With the help of the questions, you analyze your "C" for your brand. Research the information needed for this or make assumptions if you cannot research needed information Don't do an overly detailed analysis and focus on 3-4 of the questions for each “C” that you find useful as a framework – it’s just a short exercise! Step 3: Notes the results on the Miro Board. Identify one person from the group to briefly present the results. INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm SETTING COMMUNICATION OBJECTIVES Evaluation Situational Analysis 7 1 Execution (+continuous monitoring /reaction) Setting Communication Objectives 6 2 5 3 Channel-Selection & Budgeting 4 Definition of Target Audience Design of Message(s) INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm HIRARCHY OF COMPANY OBJECTIVES Objectives or goals are the results a company expects from ist operations Distinguishes its business from peer firms, identifies its scope of operations, embodies its business philosophy and reflects the image that it seeks to project BUSINESS MISSION Example BBC: „Enrich people‘s lives with programmes and services that inform, educate and entertain“ Set of clearly defined goals that an organization needs to achieve to satisfy its CORPORATE OBJECTIVES mission (often combination of market share / expansion, ROI, brand perception, reputation, impact upon stakeholders etc.) Example Marks and Spencer: „Maximise long-term shareholder value whilst exceeding the expectations of our customers, employees and partners“ MARKETING OBJECTIVES Goals that are specifically devised to satisfy the marketing-specific elements derived from the corporate objectives (as diverse as marketing itself  all 4P) Example: “Increase market penetration by 5% in the next 3 years” COMMUNICATION OBJECTIVES Focus on how stakeholders perceive or understand the organization and act upon it Example: “Increase awareness of brand by 4% over the course of a campaign” INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm Source: Eagle et al., 2021 MARKETING COMMUNICATION OBJECTIVES – A CLOSER LOOK Need arousal Brand awareness Brand attitude Usage intention Communication Target audience Target audience ability Evaluation of the Audience planned Audience perception that a to recognize or recall brand, providing a behavioral response communicational product / service is the brand and reason for choice to the message: response to the required to satisfy a associate it with the consideration with the Brand purchase message: need they feel need underlying purchase intention / switching Stimulate WoM motive (emotion + intention from other information) Interact with brand brand Frequency of usage INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm Source: Adapted from Percy, 2018, p. 185f.  Let’s have a look at an example: What might be corporate objectives? What might be communication objectives? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 45 HIRARCHY OF COMPANY OBJECTIVES Objectives or goals are the results a company expects from ist operations "To bring inspiration and innovation to every athlete in the world." BUSINESS MISSION Maintain market leadership in the sportswear and footwear industry. Develop sustainable and eco-friendly production cycles to enhance the CORPORATE OBJECTIVES brand's reputation as an innovative and socially responsible company. Increase the market share in running shoes in North America by 5% MARKETING OBJECTIVES over the next two years.Increase sales of sustainable products (like the "Nike Move to Zero" collection) by 10% to promote their commitment to environmental awareness. COMMUNICATION OBJECTIVES NEXT SLIDE INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm Source: Eagle et al., 2021 MARKETING COMMUNICATION OBJECTIVES – A CLOSER LOOK Need arousal Brand awareness Brand attitude Usage intention Communication e.g. need to perform e.g. supported by e.g. by telling inspiring e.g. special incentives e.g. encourage better as an athlete / large campaigns like stories of athletes like discount offers, customers to use the to constantly push "Just Do It," which overcoming obstacles. targeted social media Nike Run Club app, oneself and grow continually build and Here, emotions (like ads featuring allowing them to beyond one's limits reinforce brand success stories) are personalized running interact with the awareness coupled with shoes, or promoting brand and share their information about the notion that using fitness achievements product performance Nike products helps or to share their to shape how achieve athletic goals success on social consumers feel about more effectively. media using the Nike. hashtag #JustDoIt, promoting word-of- mouth marketing. INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm SOME EXAMPLES – WHAT MIGHT BE THE MAIN COMMUNICATION OBJECTIVE? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm FORMULATIONG MARKETING COMMUNICATION OBJECTIVES To be able to work with partners (e.g., agencies) on specific communication campaigns and to make the success of the campaign measurable, it is necessary to formulate precise communication objectives. These should focus on a primary communication objective (and, if necessary, auxiliary objectives) and specify which key information / communication contents are to be transferred for this purpose. They must also be formulated SMART specific Clear and focused on one target e.g. „increasing brand awareness among target audience“ measurable Quantifiable with an attached metric e.g. „by 10% compared to the pre-campaign period, measured by brand recognition“ achievable Realistically able to be achieved - are the 10% achievable reflecting on competitors and budget? relevant Tied to a broader business or marketing goal e.g. „to foster our image as health-brand number one“ timed Attached to a deadline e.g. „within the campaign period of 6 months“ INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 5 MINUTE TASK: FORMULATE A SMART COMMUNICATION OBJECTIVE FOR YOUR BRAND (each at her/his own) INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm DEFINITION OF TARKET AUDIENCE Evaluation Situational Analysis 7 1 Execution (+continuous monitoring /reaction) Setting Communication Objectives 6 2 5 3 Channel-Selection & Budgeting 4 Definition of Target Audience Design of Message(s) INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself. Peter F. Drucker INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 52 WHO ARE THE CONSUMERS OF THESE BRANDS? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  Who remembers: What is meant by segmentation? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 54 THE TARGET AUDIENCE TARGET AUDIENCE Demographics Psychographics Behavioral Data Brand Geographic Relationship Age Motivation Hobbies rural vs. urban Gender Values Buying habits climate zone Location Needs Browsing habits Culture Income Experiences Media use behavior Political situation Employment Personality traits Existing or new etc. Family status Attitudes customer? Education level etc. Brand switcher or loyal? etc. etc. Target occasion / situation INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm TAEGET AUDIENCE PSYCHOGRAPHICS: A CLOSER LOOK AT PERSONALITY Neuroticism, Emotional Irritability ("I often feel tense and nervous") Various studies show a correlation between a person's buying motives and behavior and his or her personality traits (e.g., Mooradian and Extraversion ("I like to have a lot of people around me") Olver, 1996). BIG 5 Differential psychology distinguishes between 5 Openness to experience (with negative polarity: "I find philosophical discussions boring") different dimensions of personality, the "BIG 5" (Costa and McCrae 1992), which can be more or less pronounced in each person. Agreeableness (with negative polarity: "Some people think I am cold and calculating") Conscientiousness ("I am a hardworking person who always gets the job done") INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm TAEGET AUDIENCE PSYCHOGRAPHICS: A CLOSER LOOK AT MOTIVES The needs and motives for which people consume products / services are manifold - for example, the act of purchase itself can also satisfy needs In 1943, the psychologist Abraham Maslow postulated his idea of the "hierarchy of needs", which can also be applied to marketing: Personal development Use of products that serve self-realization, e.g. adventure Self- travel / extravagant clothing realization Recognition by social environment for products, e.g. status symbols and luxury goods Recognition Belonging to group (e.g. by fashion) Success in partnership Social needs Sociability through joint use of the product Need for safety, e.g. emphasize product safety (airbag; Security insurance packages) Minimize risk with purchase itself (money-back guarantee) Existence Preservation of human existence through health, food, sleep, etc. --> Contribution of the product to this INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  INTERNATIONAL MARKETING COMMUNICATION WINTER SEMESTER 24/25 PROF. DR. ANNA GRIMM [email protected] INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm DEFINITION OF TARKET AUDIENCE Evaluation Situational Analysis 7 1 Execution (+continuous monitoring /reaction) Setting Communication Objectives 6 2 5 3 Channel-Selection & Budgeting 4 Definition of Target Audience Design of Message(s) INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm WAYS TO CLASSIFY YOUR TARGET AUDIENCE: PERSONAS A buyer persona is a fictionalized characterization of your target customer(s) based on information about them. These personas mirror various market segments, i.e. types of buyer. Personas are very helpful in order to better empathize with consumers and to better communicate target segments to third parties  Often complex mix of segmentation criteria An example: Suzi Sustainable (28)... 25-30 year old women without... works as a product manager at a large children furniture company, where she Educated, above average income campaigns for more sustainable Sustainability-conscious production methods. In her free time Leisure-oriented she likes to go to festivals and cultural Extroverted events with friends. On social media, Primary social medium: Instagram she follows DIY channels and NGOs. She (2.7h per day) is career-focused, but not willing to Buys beauty products at local sacrifice her free time for it. She mainly drugstore uses mid-priced beauty products with … natural ingredients... INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm BUYER PERSONA VS. TARGET AUDIENCE In contrast to a general description of the chosen segment, i.e. the "target audience", buyer personas thus represent an ideal- type representative of the segment so that it can be better imagined What problems can this reduction to an ideal representative cause? (i.e. biases, wrong image of the segment, etc.) I N T E R N A T I O N A L M A R K E T I N G C O M M U N I C A T I O N W i n t e r T e r m 2 0 2 4 / 2 5 P r o f. D r. Image A n n a Source: G r i m mhttps://venngage.com/blog/buyer-persona-template/ EXAMPLE BUYER PERSONA For which company could Lisa be a buyer persona representing a core target group? What other characteristics would be interesting for the company to know about her in order to design the product / service and the other “P” optimally? Do you think buyer personas are also useful in the B2B context? I N T E R N A T I O N A L M A R K E T I N G C O M M U N I C A T I O N W i n t e r T e r m 2 0 2 4 / 2 5 P r o f. D r. Image A n n a Source: G r i m mhttps://venngage.com/blog/buyer-persona-template/ CREATE AN OWN BUYER PERSONA Please think about what you know about consumers of your brand/product and create a possible buyer persona for it with your group. (If you miss relevant information, feel free to get creative) INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm EXCURSUS: BE CAREFUL WITH IMPLICIT BIASES AND AVERAGES - MARKET POTENTIAL IS OFTEN BURIED HERE! Please close your eyes for a moment and imagine pictures to go with the story I am reading... This exercise from the Unconsciuos Bias Training also has a valuable takeaway for us when determining a target audience: Personas and averages and the design of messages based on them are good and useful, but a lack of differentiation and overly stereotypical thinking can lead to potential customers being "left out“! INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  What do I actually want to know about my customer? How can I learn about her/him? (methods!) INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 65 REMINDER: TYPES OF MARKET RESEARCH: QUALITATIVE VS. QUANTITATIVE RESEARCH Qualitativ Quantitativ describe a complex phenomenon in its Empirical observations of a few selected charac- entirety (description instead of teristics using highly standardized methods. measurement) Mostly, statistical representativeness of the rather less structured and non- results is to be achieved by standardized standardized methods of data collection collection of "many" cases (="inference to the population")  Evaluation by statistical methods + Deeper lying attitudes, motives and thought contexts can be explored + Representativeness of results, development of generally valid models and forecasts possible + Completely new insights and trends can be discovered + More "objective"/intersubjective results So what do these two different strategies mean for the description of my target group? How do I use them? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm METHODS TO GET TO KNOW YOUR TARGET AUDIENCE: MARKET RESEARCH I N T E R N A T I O N A L M A R K E T I N G C O M M U N I C A T I O N W i n t e r T e r m 2 0 2 4 / 2 5 P r o f. D r. A n n a G r i m Source: m Sarstedt & Mooi (2019): A Concise Guide to Market Research, p. 50 MESSAGE DESIGN Evaluation Situational Analysis 7 1 Execution (+continuous monitoring /reaction) Setting Communication Objectives 6 2 5 3 Channel-Selection & Budgeting 4 Definition of Target Audience Design of Message(s) INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm MESSAGE CONTENT: USPs, NEEDS AND BENEFITS In general: Alignment of the core message with the communication objective! Need arousal  Message stimulates emotional or rational need Brand awareness  (Emotional) Brand image or USP in the foreground Brand attitude  Emotional or rational reasons for brand are provided Usage intention  Call for purchase / use with justification for it [Communication]  Stimulation of interactivity / feedback USP formula according to Reeves (1961): unique selling proposition compared to competitors should be in the center of the communicated message Reason: communication time is often very short; if rational arguments are to be conveyed (especially important for brand awareness and brand attitude), these must be broken down INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  What is a competitive advantage? What is the competitive advantage of apple? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 70 REMINDER: THE COMPETITIVE ADVANTAGE AND USPs Competitive strategies are aimed at clearly differentiating the company from its competitors in terms of customer benefits, and thus to define its position in the competitive environment. Competitive advantage = the factors or characteristics that permit one company to compete more effectively than its competitors (e.g. cost structure, branding, product offerings / quality, customer service etc.) „Competitive advantage is not about what you are best at – but what you are best at in relation to competition!“ COMPARATIVE AVANTAGE DIFFERENTIAL AVANTAGE = ability to produce something more = company's products are seen as efficiently than a competitor both unique and of higher quality, (“cheaper”)  greater profit margins relative to those of a competitor e.g. better production technology, larger e.g. better product quality, unique facilities, cheaper employees etc. product features, branding etc. Unique Selling Proposition (USP) = Unique product benefit that is communicated to customers of your product; Competitive Advantage that is communicated INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  “Positioning is not what you do to the product; it’s what you do to the mind of the prospect. It’s how you differentiate your brand in the mind. Positioning compensates for our over- communicated society by using an oversimplified message to cut through the clutter and get into the mind. Positioning focuses on the perceptions of the prospect not on the reality of the brand.” Al Ries INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 72 MESSAGE CONTENT: USPs Reflect upon the category you compete with when positioning your product communicatively! Literal Competitive Framework (explicit, direct competition): Company / brand offering same product / service Perceived competitive Framework (implicit competition): Class to which the brand is supposed to belong VS. VS. Cottage cheese Protein Supply USP: Has extra USP: Is natural! protein INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  What is a literal competitor? What a perceived one? What is the respective USP? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 74 REMINDER: MARKETING COMMUNICATION OBJECTIVES Need arousal Brand awareness Brand attitude Usage intention Communication Target audience Target audience ability Evaluation of the Audience planned Audience perception that a to recognize or recall brand, providing a behavioral response communicational product / service is the brand and reason for choice to the message: response to the required to satisfy a associate it with the consideration with the Brand purchase message: need they feel need underlying purchase intention / switching Stimulate WoM motive (emotion + intention from other information) Interact with brand brand Frequency of usage  Many advertising campaigns address several communication objectives, but try to achieve the attention and (emotional) involvement of consumers primarily through need/motive arousal INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm Source: Adapted from Percy, 2018, p. 185f. MESSAGE CONTENT: ADRESSING CONSUMERS BASIC MOTIVES Basic Motives according to David McClelland: Achievement motive Power Motive Social / Connection Motive = trying to reach certain = is based on dominating other = we satisfy by having fellowship standards ("better than people; either in the form of with others, cultivating intimacy yesterday") aggressive dominance, or also and avoiding isolation through altruistic leading / caring. INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 76 MESSAGE CONTENT: ADRESSING CONSUMER NEEDS FUNCTIONAL NEEDS SOCIAL NEEDS EMOTIONAL NEEDS Customers evaluate product / relates to how a person wants to relates to how a customer wants service based on whether they’ll be perceived by others when to feel when using a product or help them achieve a particular task using a product or service service or function. usually rather unaware, but very e.g. “I want to feel powerful and Might be more or less specific influential relaxed” e.g. „I need a new wardrobe that e.g. “I want my friends to like fits into my flat“ me” can be addressed by emotionally conveying how the user of the can be addressed by emotionally product feels, e.g. via testimonial Address need by knowing as well / substitute experience and as possible what the functional illustrating social fears and needs and offering solution / security associations need might be, sympathize with it and offer solution INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm Source: https://online.hbs.edu/blog/post/types-of-customer-needs FEATURE VS. BENEFIT When formulating messages, care should be taken to communicate not a feature but a resulting benefit for the customer  “How we help you to satisfy your need”  What kind of Need do we have in these two examples? Functional, social or emotional? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm Source: https://www.vappingo.com/word-blog/examples-of-features-versus-benefits/ FEATURE VS. BENEFIT Feature = Statement about your product, e.g. specifications Benefit = What a product can accomplish for the prospective owner (Why do I need the Feature?) Depending on prior knowledge of consumers, the "translation work" from feature to benefit has to be taken over so that the argument is received  task of marketing communication, e.g. sales person BUT: First marketing has to make sure, that the benefits are actually fitting customer needs! Source: https://praxis.co.id/stories/read/379/Feature-vs-Benefit-Siapa-Juaranya- INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm REMINDER: MARKETING COMMUNICATION OBJECTIVES Need arousal Brand awareness Brand attitude Usage intention Communication Target audience Target audience ability Evaluation of the Audience planned Audience perception that a to recognize or recall brand, providing a behavioral response communicational product / service is the brand and reason for choice to the message: response to the required to satisfy a associate it with the consideration with the Brand purchase message: need they feel need underlying purchase intention / switching Stimulate WoM motive (emotion + intention from other information) Interact with brand brand Frequency of usage INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm Source: Adapted from Percy, 2018, p. 185f. WRAPPING THE CONTENT IN CREATIVITY There are many very diverse definitions of Humour "creativity" in the communications context, but many have in common: the development of new, original ideas that appeal to consumers' prior Nostalgic knowledge and thus evoke attention and emotions Emotionality Sex (see e.g. Eagle et al. 2021) A distinction is made between different creativity tactics, which are mainly used in advertising communication Expertise / Fear / Shock Authority Such tactics are (see right side) INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm CREATIVITY TACTICS: HUMOUR SEX / SEXUAL REPRESENTATION Various forms, such as: pun, understatement, joke, Sexual appeals have been demonstrated to attract ludicrous, satire, irony customers attention and generating high levels of Low-risk-option  usually generates high levels of recall  “sex sells?”, especially in younger audiences „ad-liking“ But: Negative perception in an increasingly large Rather effective in low-involvement-contexts consumer group; high cultural sensitivity and ethical concerns INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm CREATIVITY TACTICS: FEAR / SHOCK APPEALS EXPERTISE / AUTHORITY Using the threat of negative consequences to Organizations or individuals with an “expert” status motivate consumers into action (e.g. for well-being) (high source credibility) as speakers Difficulty in finding the right "strength": Appeals Rather successful in high-involvement-contexts that are too weak do not help, appeals that are too combined with factual arguments strong lead to reactance behavior and avoidance INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm CREATIVITY TACTICS: (NOSTALGIC) EMOTIONALITY Content attempts to evoke feelings in consumers that they have already experienced in other contexts In some cases, nostalgia / vintage is also transported as an emotion in its own Especially promising for products that satisfy emotional needs only and do not provide rational arguments INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  LET‘S PLAY A LITTLE CREATIVITY GUESSIG GAME! Which creativity tactics are used here? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm IMPORTANT: PRETEST YOUR MESSAGES! After the first version of the message is designed, it is recommended to pretest it with the target group to address e.g.: the following questions: Does the overall message adress the communication objective? How likely will the target audience understand the message? Is the link between the brand and the need clear? What impact is the message likely to have on the target audience? Common practice for this is a survey of a small number of subjects or a focus group. INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm CHANNEL-SELECTION & BUDGETING Evaluation Situational Analysis 7 1 Execution (+continuous monitoring /reaction) Setting Communication Objectives 6 2 5 3 Channel-Selection & Budgeting 4 Definition of Target Audience Design of Message(s) INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm BUDGETING – THE „SHARE A COKE“ CAMPAIGN The "Share a Coke" campaign started in Australia in 2011 and later rolled out worldwide. The idea was to print bottles with the most popular first names to foster a more personal connection with consumers. The campaign was hugely successful, increasing sales in several markets and boosting consumer interaction with the brand. What media channels do you think Coca-Cola has used for this campaign? What did they have to plan money for? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  Coca-Cola's 'Share a Coke' campaign shows us the potency of seeing the world through the customer's eyes, proving that marketing is not just about selling products, but about connecting stories. It embodies what I have always said: Instead of using technology to automate processes, think about using technology to enhance human interaction. Steve Jobs Source: https://www.historyoasis.com/post/share-a-coke INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 89  How much do you think CocaCola has spent for this campaign globally? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 90 REMINDER: MARKETING COMMUNICATION OBJECTIVES Need arousal Brand awareness Brand attitude Usage intention Communication Target audience Target audience ability Evaluation of the Audience planned Audience perception that a to recognize or recall brand, providing a behavioral response communicational product / service is the brand and reason for choice to the message: response to the required to satisfy a associate it with the consideration with the Brand purchase message: need they feel need underlying purchase intention / switching Stimulate WoM motive (emotion + intention from other information) Interact with brand brand Frequency of usage What were the main communication objectives of the campaign? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm Source: Adapted from Percy, 2018, p. 185f.  Where do you see ads during the day? Where does your grandmother see advertising? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 92 CHANNEL SELECTION The decision which elements of the marketing Target Audience communication mix should be used (see Chapter 5) is usually made before the specific message is created or together with it, as the message must fit the channel. Message The channels must also fit the target group defined at the Design beginning, as well as the communication goals. Selected Communication Further Selection Criteria: Channels 1. Degree of control required over the delivery of the message 2. Financial resources available to pay a third party (e.g. media- Communication channel) to transmit messages Objectives 3. Level of credibility that each tool bestows on the organisation 4. Size and geographic dispersion of the target audiences INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  A LITTLE PREVIEW ON ELEMENTS OF THE COMMUNICATION MIX Decision 2: Wich Decision 1: Which elements of Communication Mix should be involved? ADVERTISING PUBLIC RELATIONS SALES DIRECT PERSONAL TRADE FAIRS & SOCIAL MEDIA & & SPONSORING PROMOTION MARKETING SELLING EVENTS WORD OF MOUTH should be involved? TV-Ads Own PR Events Sampling Email-Marketing Customer respective media SEA Sponsoring of Coupons Telemarketing Service Social Media sports events Sign-up rebates Interactive Face-to-face Ads Press releases Price promotions communications selling Print etc. etc. etc. etc. More about (integrated) Outdoor channel selection in chapter 5! etc. Decision 3: Wich precise media channels (e.g. with TV program / newspaper) should be involved? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  Which advertising channels are the most money spent on? So TV, digital, cinema etc.? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 95  Distribution of advertising spending worldwide from 2022 to 2026 Distribution of ad spend worldwide 2022-2026, by medium Share Digital TV Print Out-of-home Audio Cinema 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2022 2023* 2024* 2025* 2026* Note(s): Worldwide; 2022 Further information regarding this statistic can be found on page 8. Source(s): Dentsu; ID 245440 INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 96 BUDGETING METHODS METHOD EXPLANATION MAIN BENEFITS MAIN DISADVANTAGES ARBITRARY BUDGETING „What we always invested +x / Easy Ignores flexible budget requirements what is left“ Easily accepted by responsible and objectives parties No relativization of communication success and expenses PERCENTAGE OF SALES Fixed budget as percentage of Budget is related to sales Communication is treated as function / REVENUE past, current or anticipated sales revenue of sales instead of other way around prices per unit Helps preventing costly Future opportunities / growth is communicative competition inhibited between competitors Long-term planning is difficult COMPETITIVE PARITY „We invest what our competitors Helps preventing costly Knowledge of competitors budget BUDGETING invest“ communicative competition must be gained and can be incomplete between competitors Only follow instead of lead Seems relatively simple at first No rational or objective budgeting criteria OBJECTIVE AND TASK (1) Objectives are defined in Very accurate and strategic Requires intensive research, which COSTING APPROACH quantifiable terms (2) Each task is budget allocation may not be correct assigned necessary costs by means of research (3) If necessary, check of cost-benefit (4) Sum of costs results in budget INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm WHAT KIND OF BUDGETING DO WE HAVE HERE? ARBITRARY BUDGETING PERCENTAGE OF SALES / REVENUE COMPETITIVE PARITY BUDGETING OBJECTIVE AND TASK COSTING APPROACH "The marketing department of a medium-sized company that sells office supplies sets aside a fixed amount for marketing each year, based on what was spent the previous year. The only adjustment is a slight increase to account for inflation. There is no detailed analysis of which actions were particularly successful." "A new startup in the sustainable clothing sector has clearly defined goals: to acquire 10,000 new customers within a year. The company identifies the various marketing activities "A company that produces household cleaners needed to achieve this goal (e.g., social media campaigns, conducts market research to understand how much its events, influencer marketing). Then, the costs for each of main competitors are spending on marketing. Based on these activities are calculated, and the total budget is set this information, the company decides to spend accordingly. Each expense is specifically aimed at achieving approximately the same amount on its advertising the predefined goals." campaigns to keep up with the competition." INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  What percentage of sales do companies probably spend on advertising? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 99 Marketing budget as a percentage of companies' total revenues according to chief marketing officers (CMOs) in North America and Europe from 2014 to 2024 Marketing budget's share in companies' revenues in North America & Europe 2014-2024 12,1% 12% 11,4% 11,3% 11,2% 11% 10,5% 10,2% 10% 9,5% 9,1% 8% 7,7% Share of revenue 6,4% 6% 4% 2% 0% 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Note(s): North America, Europe; 2014 to 2024; 395*; respondents across 10 different sectors whose employers predominantly reported median annual revenues above 5.3 billion U.S. dollars; excluding "Don't know" responses Further information regarding this statistic can be found on page 8. Source(s): Gartner; Inside Radio; ID 1285395 I N T E R2 N A T I O N A L M A R K E T I N G C O M M U N I C A T I O N W i n t e r T e r m 2 0 2 4 / 2 5 P r o f. D r. A n n a G r i m m 100 BUDGETING: EXAMPLES FROM PRACTICE COMMUNICATION BUDGETING: EXAMPLES FROM PRACTICE “The U.S. Small Business Administration recommends spending 7-8% of your gross revenue if you are bringing in less than $5 million a year.” INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm  Which companies spend the most money on advertising in Germany? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 102  Leading advertisers ranked by advertising expenditure in Germany from June 2024 (in million euros) Advertisers with highest advertising spending in Germany 2024 250 195,76 200 Ad spend in million euros 150 100 55,31 52,44 52,41 48,31 50 42,65 31,89 31,73 21,7 17,52 0 Procter & Lidl Aldi Ferrero Telekom Rewe Henkel Amazon Mediashop Kaufland Gamble Note(s): Germany; June 2024; adjusted advertising trend; Gross advertising expenditure Further information regarding this statistic can be found on page 8. 4 Source(s): Nielsen; ID 381227 INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 103  In which countries is the most spent on advertising? INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm 104  Advertising spending in selected markets worldwide in 2024 (in billion U.S. dollars) Ad spending in selected markets worldwide 2024 Advertising spending in billion U.S. dollars 0 50 100 150 200 250 300 350 400 450 United States 422,3 China 231,1 United Kingdom 58,2 Japan 55,83 Germany 27,3 Canada 22,94 France 20,78 Australia 19,43 Brazil 17,82 South Korea 17,31 India 16,03 Italy 11,7 Spain 10,58 Russia 9,76 Mexico 9,74 Note(s): Worldwide; 2023; forecast Further information regarding this statistic can be found on page 8. Source(s): Statista; Statista Advertising & Media Insights; ID 1380173 I N T E R2 N A T I O N A L M A R K E T I N G C O M M U N I C A T I O N W i n t e r T e r m 2 0 2 4 / 2 5 P r o f. D r. A n n a G r i m m 105 DEFINITION OF TARKET AUDIENCE Evaluation Situational Analysis 7 1 Execution (+continuous monitoring /reaction) Setting Communication Objectives 6 2 5 3 Channel-Selection & Budgeting 4 Definition of Target Audience Design of Message(s) INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm WHY TO MONITOR YOUR CAMPAIGNS: SOME BAD PRACTICE EXAMPLES Even with careful pretesting, communication campaigns don't always do what they're supposed to - sometimes the creative idea isn't received as intended or external circumstances / events lead to problems In times of two-way communication via social media and Co., campaigns can also do the opposite of what they should and trigger shit storms INTERNATIONAL MARKETING COMMUNICATION Winter Term 2024/25 Prof. Dr. Anna Grimm MONITOR YOUR CAMPAIGNS In order to save money on unsuccessful or even harmful campaigns and to adjust them if necessary, they should be monitored continuously - even if this initially looks like a lot of work Important for this: Measurable criteria for campaign success depending on the chosen medium Some examples: Email Marketing Content Metrics Social Media Metrics Set detailed SMART objectives Click-rate Conversion rate Shares Conversion Rate Bounce rate Comments Bounce Rate Time spent on page Follows Monitor Campaigns Scroll depth