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Week 1 MKT

Wk 1 – Integrated Marketing Concepts Applications Paper

Assignment Content

Resource:

Integrated Marketing Concepts Applications Grading Guide

Write a 1,050-word paper that describes the various components of Integrated Marketing Communications (IMC) and how these components relate to building a brand image.

Select two companies that have successfully integrated some or most of these components into their IMC Plan:

o Implementation of a digital marketing strategy

o A successful advertising campaign

o A viral marketing plan with brand ambassadors

Answer the following questions:

o Did the campaign help the company build or reinforce a brand image (i.e. define the message in the campaign, and describe how the message helped to build the brand)?

o What is the company’s value principle and how does it tie into the branding message?

Format your paper consistent with APA guidelines, including any citations for materials used from any websites.

Submit your assignment.

Resources

Center for Writing Excellence

Reference and Citation Generator

Grammar and Writing Guides

Wk 1 – Integrated Marketing Concepts Applications Paper

Assignment Content

Top of Form

Resource:

Integrated Marketing Concepts Applications Grading Guide

Write a 1,050-word paper that describes the various components of Integrated Marketing Communications (IMC) and how these components relate to building a brand image.

Select two companies that have successfully integrated some or most of these components into their IMC Plan:

· Implementation of a digital marketing strategy

· A successful advertising campaign

· A viral marketing plan with brand ambassadors

Answer the following questions:

· Did the campaign help the company build or reinforce a brand image (i.e. define the message in the campaign, and describe how the message helped to build the brand)?

· What is the company’s value principle and how does it tie into the branding message?

Format your paper consistent with APA guidelines, including any citations for materials used from any websites.

Submit your assignment.

Resources

Center for Writing Excellence

Reference and Citation Generator

Grammar and Writing Guides

Bottom of Form

Chapter 2

Brand Management

CHAPTER OBJECTIVES

Students should be able to answer the following questions:

2.1 How does a brand’s image affect consumers, other businesses, and the company

itself?
2.2 What are the different types of brands and brand names?
2.3 What are the characteristics of effective logos?
2.4 What elements are involved in identifying, creating, rejuvenating, or changing a

brand’s image?
2.5 How are brands developed, built, and sustained in order to build brand equity and

fend off perceptions of brand parity?
2.6 What current trends affect private brands?
2.7 How can packaging and labels support an IMC program—domestically and in

foreign settings?
2.8 How are brands managed in international markets?

OVERVIEW

One of the most critical ingredients in the successful development of an integrated
marketing communications plan is effective management of an organization’s image.

Domino’s Brand Image Overhaul

Domino’s marketing team identified a trend in which more customers were picking up pizzas
rather than having them delivered. In response, some stores added big screen TVs, improved
seating for those waiting to pick up orders, and established places where people could watch
their pizza or carry-out items being put together.

The approach somewhat resembles what occurs in Subway stores.

To accentuate these new methods of operation, the company’s name was also changed from
Domino’s Pizza to simply Domino’s.

The brand name change and product line alterations were orchestrated with the firm’s
integrated marketing communications program, including advertising and social media.

Questions for Students:

1. What do you think of when you hear “Domino’s”?
2. Compare your image of Domino’s to other pizza chains.
3. Do you believe the changes will make a difference?

The first part of this chapter examines the activities involved in managing a corporation’s
brand image, including its name and logo.

The second part addresses ways to develop and promote the various forms of brand names.
Brand equity and brand parity are described.

Finally, packages and labels, which should be included in any marketing communications
program, are assessed. Ethical and international considerations are noted.

Objective 2.1: How does a brand’s image affect consumers, other businesses, and

the company itself?

Corporate and Brand Image

A brand is the word, term, or phrase featured as the name of a product, product line, or
company.

A corporation’s brand image reflects the feelings consumers and businesses have about the
overall organization as well as its individual products or product lines.

Consumer beliefs about a firm are more important than how company officials perceive the
image.

Components of Brand Image

A corporate image contains invisible and intangible elements (see Figure 2.1). The
components of a corporate image include the following:

• Products
• Personnel

• Retail outlets
• Servicing
• Advertisements
• Publicity
• Interactions with employees

Negative publicity has the potential to stain or damage consumer perceptions of a
corporation’s image.

Question for Students: What organizations can you think of that experienced damage

to their images in the past five years? What caused the
damage? (The BP oil spill is an example.)

The Role of Brand Image—Consumer Perspective

From a consumer’s perspective, the corporate image serves several useful functions (see
Figure 2.2). These include

• Assurance regarding purchase decisions of familiar products in unfamiliar
settings

• Assurance concerning purchases where there is little previous experience
• Reduction of search time in purchase decisions
• Psychological reinforcement and social acceptance

The Role of Brand Image—Business-to-Business Perspective

Corporate image is a crucial element of the business-to-business marketplace.

Figure 2.3 identifies 10 top brands.

Making purchases from a well-known company is in many ways the same process as
consumer purchases, in terms of the advantages of a strong and positive image.

Corporate image is especially important when expanding internationally.

The Role of Brand Image—Company Perspective

Figure 2.4 lists benefits of brands to individual companies.

These include

• Extension of positive consumer feelings to new products
• The ability to charge a higher price or fee
• Consumer loyalty leading to more frequent purchases

• Positive word-of-mouth endorsements
• The ability to attract quality employees
• More favorable ratings by financial observers and analysts

Objective 2.2 What are the different types of brands and brand names?

Brand Names and Brand Types

A corporate name is the overall banner under which all other operations occur. Figure 2.5
lists the categories of brand names.

• Overt names reveal what the company does (American Airlines, BMW Motorcycles).
• Implied names imply what the company is about (FedEx, IBM).
• Conceptual names imply the essence of the brand (Google, Krispy Kreme).
• Iconoclastic names do not reflect the company’s goods or services (Apple,

Monster.com).

Question for Students: Can you provide additional examples of each of these types of
names?

Figure 2.6 provides backgrounds for some well-known company names.

Brands develop histories. They have personalities. They include strengths, weaknesses, and
flaws.

Figure 2.7 identifies several types of brands.

Family Brands

A family brand means a company offers a series or group of products under one brand, such
as Campbell’s.

The advantage of a family brand is that consumers usually transfer the image associated with
the brand name to any new products added to current lines.

Brand Extensions

Brand extension is the use of an established brand name on goods or services that are not
related to the core brand.

Black & Decker has been successful in extending its brand name to new types of power
tools. The company was not as successful in extending the line to small kitchen appliances.

Flanker Brands

A flanker brand is the development of a new brand by a company in a good or service
category it currently has as a brand offering. Flanker brands can help a company offer a
more complete line of products, creating barriers to entry for competing firms.

Figure 2.8 lists select brands offered by Procter & Gamble.

Co-Branding

Co-branding, or alliance branding, can take three forms, as shown in Figure 2.9.

1. Ingredient branding—is the placement of one brand within another brand.
2. Cooperative branding—a joint venture of two or more brands into a new

product or service.
3. Complementary branding—is the marketing of two brands together to encourage

co-consumption or co-purchases.

Co-branding succeeds when it builds the brand equity of both brands.

Recently, Wholly Guacamole developed a brand alliance with Sonic.

NutraSweet has co-branded with Diet Coke.

There can be risks in co-branding. If the relationship fails to do well in the marketplace, both
brands normally suffer.

Objective 2.3: What are the characteristics of effective logos?

Brand Logos

A brand logo is a symbol used to identify a company and its brands, helping to convey the
corporate image.

Quality logos and corporate names should pass four tests, as shown in Figure 2.10.

1. They should be easily recognizable.
2. They should be familiar.
3. They should elicit a consensual meaning among those in the firm’s target

market.
4. They should evoke positive feelings.

Figure 2.11 identifies some of the oldest logos.

Logos are especially important for in-store shopping. To be advantageous, the logo should
help with two things:

1. Consumers must remember seeing the logo in the past.
2. The logo must remind consumers of the brand or corporate name.

The notion that a logo can elicit a consensual meaning among customers is known as
stimulus codability.

A logo does not have to be complex and contain every element of the brand’s meaning.
Simple logos can be effective, such as the Nike Swoosh.

Changing logos does not always modify public opinion of a company.

When completed properly, logo changes can trigger positive reactions and symbolize a
positive change, such as when Pepsi developed a new logo.

Tips for creating or changing logos are provided in Figure 2.12.

Question for Students: Companies at times choose to modify the logo. Can
you think of some examples?

Objective 2.4: What elements are involved in identifying, creating, rejuvenating,

or changing a brand’s image?

Identifying the Desired Brand Image

To promote the desired image, the marketing team should evaluate the nature of the
company’s current image. Then future communications can be tailored to promote the proper
image.

Company leaders first study the firm’s image and identify how it is connected to a company’s
strengths and weaknesses.

The marketing team should try to discover how those outside of a company view the brand.
Once the team understands how the brand is viewed, decisions can be made regarding ways
to correct any misperceptions or build on the image that customers currently hold.

Creating the Right Brand Image

In each industry, the right image is one that reaches all target markets and conveys a clear
message regarding the unique nature of the organization and its products.

A strong image accurately portrays what the firm sells.

In a business-to-business operation, creating the right image can be challenging.

Rejuvenating a Brand’s Image

Reinforcing or rejuvenating a current image that is consistent with the view of consumers is
easier to accomplish than changing a well-established image.

Figure 2.13 lists four keys to image rejuvenation.

The key to successful image reengineering is to remain consistent with a previous image
while at the same time building to incorporate new elements to expand the firm’s target
audience.

Rejuvenating an image helps a firm sell new products and can attract new customers.

L’Eggs provides an example of an effective brand rejuvenation effort.

Changing a Brand’s Image

Completely changing the image people hold regarding a company or a brand may not be
possible.

Attempting to change an image becomes necessary when target markets have begun to
shrink or disappear, or the brand’s image no longer matches industry trends and consumer
expectations.

At that point, company leaders must consider what they wish to change, why, and how they
intend to accomplish it.

Target sought to change its image to become accepted by readers of Vogue magazine.

Learning Objective 2-5: How are brands developed, built, and sustained in order to
build brand equity and fend off perceptions of brand parity?

Developing and Building Powerful Brands

Developing a strong brand begins with discovering why consumers buy a brand and why
they repurchase the brand. Questions to be asked include the following:

• Where does your brand stand now?

• What are your objectives?

• What are you doing to build your brand and business?

• What are your brand’s strengths? Weaknesses?

• Which opportunities should be pursued first? Where are the pitfalls?i

The goal of branding is to set a product apart from its competitors.

One primary feature that keeps a brand strong is that it contains something that is salient to
customers.

Figure 2.14 identifies the ingredients required to build powerful brands.

Branding begins with awareness, which may be achieved by featuring the brand name
prominently in repeated advertisements.

Brands should be authentic or unique in some manner.

Business and retail customers trust powerful brands. Trust represents the customer’s belief in
the efficacy and reliability of the brand.

Powerful brands go beyond delivering functional features. They focus on providing an
experience that involves the opportunity to be to customized and personalized.

Building powerful brands requires the effective use of social media and mobile advertising.

The final ingredient of powerful brands results when the company acts responsibly.

Brand Loyalty

Brand loyalty means customers purchase only one brand. They consider no other brand,
regardless of price differences.

The Brand Keys Customer Loyalty Engagement Index (CLEI) suggests that emotion and
value are the core drivers of brand loyalty, rather than rational thought based on functional
product attributes.

Figure 2.16 identifies some of the top brands in select categories, in terms of engagement.

Brand Equity

Brand equity is the perception that a good or service with a given brand name is different
and better.

Brand equity allows the company the opportunity to charge a higher price and retain a
market share that is greater than would otherwise be expected for an undifferentiated
product.

Brand parity is the perception that there are no tangible differences between competing
brands.

In business-to-business markets, brand equity often allows a company to charge a higher
price.

Brand equity is a strong weapon that might dissuade consumers from looking for a cheaper
product or for special deals or incentives to purchase another brand.

Brand name recognition and recall can be built through repetitious advertising.

Measuring Brand Equity

Marketers have developed four different methods to measure brand equity (see Figure 2.17).

Brand equity based on financial value estimates the future cash flows of a brand based on its
unique strength and characteristics, which will then be discounted to determine a net present
value.

The stock market approach means the financial value of the company is determined through
stock valuation. Then an estimate of the portion of the value allocated to brand equity and
not physical assets is made.

The revenue premium compares a branded product to the same product without a brand
name.

The consumer value attempts to measure the value of a brand based on input from
consumers. Typical measures include familiarity, quality, purchase considerations, customer
satisfaction, and willingness to seek out the brand.

Figure 2.18 identifies the top 10 most loved brands.

Objective 2-6: What current trends affect private brands?

Private Brands

Private brands, private labels, and store brands are proprietary brands marketed by an
organization and normally distributed exclusively within the organization’s outlets.

Advantages to Retailers

Several changes have occurred in the private brand arena, summarized in Figure 2.16:

• Quality levels of private label brands have improved.
• Many brands are perceived as a value purchase.
• Loyalty toward stores has been gaining although loyalty toward individual

brands has been declining, giving an advantage to private labels.
• Private labels are used to differentiate retail outlets.
• Many firms are now advertising company private brands.
• There is increase in the quality of in-store displays for and packaging of private

labels.

Responses from Manufacturers

Some manufacturers have begun to respond to the inroads made by private labels. Figure
2.20 lists some of the tactics used by manufacturers, including

• Focus on a few core brands
• Advertise heavily
• Expanding product offerings
• Focus on in-store selling
• Use alternative marketing methods

Objective 2-7: How can packaging and labels support an IMC program—

domestically and in foreign settings?

Packaging

A unique package and label can help sell a product, build brand recognition, and inspire
repeat purchases.

The primary purposes of packages are displayed in Figure 2.21.

An example advantage created by packaging is the new form of refrigerator-friendly 12
packs, as created by Alcoa Rigid Packaging.

Sometimes packaging changes are necessitated by adverse market conditions. The popularity
of Proctor & Gamble’s Tide Pods surged as soon as it hit the market because of ease of use;
however, the company had to overcome the problem of children thinking the pods were
candy, so the package was modified.

Labels

Labels must

• Meet legal requirements.
• Point out distinguishing features of the product.
• Help lead to the purchase.

The label represents another marketing opportunity.

A company’s image, brand, logo, and theme should extend to the design of the package and
label.

The placement of QR codes for consumers to access with mobile devices represents a new
trend in packaging and labeling.

Ethical Issues in Brand Management

Brand infringement occurs when a company creates a brand name that closely resembles a
popular or successful brand (Korrs, Victor’s Secret).

Domain squatting or cyber squatting means buying a domain name with the purpose of
making a profit by reselling it to the firm.

Objective 2-8: How are brands managed in international markets?

International Implications

Carefully consider standardization versus adaptation when developing global brands.

Make sure packages and labels are legal and protect the product being shipped over long
distances.

Be aware of the complications that occur when trying to position products in global markets.

The label must meet the legal requirements of the country in which the product is sold.

MyMarketingLab

Go to mymktlab.com to complete the problems marked with this icon .

Note to Professors:

The MyLab feature at Pearson will grant you access to the Integrated Campaigns in Action
within the Instructor’s Resource section.

The authors’ blog for professors and students may be found at http://blogclowbaack.net/.

Both methods contain actual print materials produced for the campaign. Broadcasts
material such as video ads, TV ads, and radio ads are embedded using YouTube and
Pearson servers.

These features bring to life the exciting process of building integrated advertising and
marketing campaigns. Most important, you will have access to insights and background
information from the agencies and the companies involved in how the campaigns were
created.

IMPLICATIONS FOR BRAND MANAGERS AND PUBLICITY
DEPARTMENTS

(Note to professors— these materials are not in the text. They provide a method for
you to summarize the chapter in a different way)

Note the tricky relationship between a strong corporate image and bottom-line profits. In
other words, be aware that it is difficult to use numbers to express the value of an effective
image in an era where accountability is such a major concern.

Recognize the value of the following items:

• An identifiable company logo
• A brand name that generates both recall and a favorable impression
• Quality family brands
• Brand equity
• Effective use of private labels

Study the company’s position and the position of each individual product. Use the attributes
of price, competition, use, quality, users, product class, or cultural symbols to identify the
position that the company and its products hold. Then, make decisions about the following
issues:

• Is this position where we thought we were?
• Is this the position we want?
• If we intend to change our position, where do we aspire to be?
• Which tactics will move the company and its products to the correct,

appropriate, or desired position?

REVIEW QUESTIONS

2-1. Describe the concept of brand image. What are the tangible aspects of a brand

image? What are the intangible aspects?

Corporate image is how consumers view a company, which has many intangible and
tangible aspects. The tangible aspects include
• Goods and services sold
• Retail outlets where product is sold
• Factories where product is produced
• Advertising, promotions, and other forms of communications
• Corporate name and logo
• Employees

Intangible elements include the firm’s reputation for quality, standing behind
products, and methods of dealing with customers.

2-2. How does brand image help customers? How does it help the specific

company?

A corporation’s image can help customers by

• Providing assurance when they make purchase decisions of familiar products in
unfamiliar settings

• Providing assurance for purchases when there is little previous experience
• Reducing search time in purchase decisions
• Providing psychological reinforcement and social acceptance of purchase

decisions

A corporation’s image helps the company by

• Making brand extensions easier
• Being able to charge a higher price
• Creating higher customer loyalty
• Leading to more frequent purchases

• Promoting positive word-of-mouth communications
• Attracting quality employees
• Causing the firm to be viewed more favorably by financial analysts

2-3. Describe the use of brand extension and flanker brand strategies.

Brand extensions appear when the company uses an established brand name on
goods or services that are not related to the core brand. Flanker brand strategies are
the development of a new brand by a company in a good or service category it
currently has a brand offering for.

2-4. Identify and describe three types of co-brands or alliance branding.

The three types of co-brands are

1. Ingredient branding, or placement of one brand within another brand
2. Cooperative branding, which is a joint venture of two or more brands into a new

product or service
3. Complementary branding, which is the marketing of two brands together to

encourage co-consumption or co-purchases

2-5. What is a brand logo? What are the characteristics of an effective corporate

logo?

A corporate logo is something (usually a symbol) that is easily recognizable to
consumers. The characteristics of a corporate logo are that it should be easily
recognizable, familiar, elicit consensual meaning among those in the firm’s target
market, and should evoke positive feelings.

2-6. What is meant by the term “stimulus codability?”

Stimulus codability means that a logo can elicit a consensual meaning among
customers.

2-7. How will company leaders know that they have created the desired image for

their firm?

Student answers will vary based on their personal response. Refer to the MyLab for

an opportunity to assign this question, and all starred MyLab questions, to a student
discussion board.

A firm will know the marketing team has created the right image for the firm when
benefits appear, such as attracting more customers, favorable ratings by financial
observers and analysts, and the company attracts quality employees.

2-8. What four areas require attention when seeking to rejuvenate a firm’s
image?

First, former customers need to rediscover the brand. Second, older and newer
consumers need to be connected to the brand through a timeless value it offers. Third
the brand should be contemporized. Fourth, marketers can build a brand community
through social media, mobile, and other interactive marketing techniques.

2-9. What are the characteristics of a strong and effective brand name?

The characteristics of a strong and effective brand name are that it is easily
recognizable to consumers and that consumers have a positive reaction to the brand
name.

2-10. Explain the role of trust in creating a strong brand.

Trust represents the customer’s belief in the efficacy and reliability of the brand. It
can be established over time through personal experiences. Trust results from a brand
performing consistently and fulfilling its promise, its authenticity, and its uniqueness.

2-11. What is the difference between brand equity and brand parity?

Brand equity is the set of characteristics unique to a brand that provide value to the
brand. In essence, the brand is different and better. Brand equity allows the company
the opportunity to charge a higher price and retain a market share that is greater than
would otherwise be expected for an undifferentiated product. Brand parity is the
perception that there are no differences between major brands.

2-12. What methods can be used to measure brand equity?

Brand equity based on financial value estimates the future cash flows of a brand

based on its unique strength and characteristics, which will then be discounted to
determine a net present value.

With the stock market approach, the financial value of the company is determined

through stock valuation.

The revenue premium compares a branded product to the same product without a

brand name.

The consumer value method attempts to measure the value of a brand based on input
from consumers. Typical measures include familiarity, quality, purchase
considerations, customer satisfaction, and willingness to seek out the brand.

2-13. How has private branding, or private labeling, changed in the past decade?

Student answers will vary based on their personal response. Refer to the MyLab for
an opportunity to assign this question, and all starred MyLab questions, to a student
discussion board.

Private branding, or private labeling, has changed in the past decade in the following
ways: the quality levels of products have increased; the products are perceived as
having high value; loyalty to stores has increased, allowing store managers to
increase in-store or private lines; they can be used to differentiate retail outlets;
private label companies have begun to advertise these differences; and store
managers now devote more effort to creating quality in-store displays of and
packages for private brands.

2-14. What role does a product’s package play in the marketing program?

The package is the last chance to make an impression on a customer. It should
protect the contents, stand out, and tell the consumer what is inside.

2-15. How can a label support an IMC program or advertising campaign?

Labels must meet legal requirements and be distinguishable to consumers. Labels
can refer to features of advertisements and other IMC efforts. They should match the
theme of the IMC campaign.

2-16. What ethical issues are associated with brand management?

There are concerns with brand infringement and with domain or cyber
squatting.

2-17. How do the concepts of standardization and adaptation apply to branding

strategies?

Marketing managers must choose the strategy that fits the company and its
products. There has been some resistance to more global or standardized brand
names.

CRITICAL THINKING EXERCISES

2-18 Ashley Drake just purchased a small clothing boutique two blocks from your

campus. The current name of the store is College Fashions. She feels she
needs a new name that projects an image of offering trendy, hip fashions to
your college’s students. What name would you suggest? Discuss your brand
name in terms of which category it fits and the four tests of quality names. To
succeed, Ashley knows she needs to retain the store’s current customers as
well as gain new ones. Outline a plan to rejuvenate the company’s brand
image using the keys to image rejuvenation identified in Figure 2.5.

The brand name is overt name. It passes the four tests.

1. It is recognizable.
2. It is familiar.
3. It should elicit a consensual meaning among those in the firm’s target market.
4. It can evoke positive feelings.

The new plan should create a new experience for buyers. It really cannot rely on past

relationships, because the company is new. It should be authentic.

Student answers will vary based on their personal response. Refer to the MyLab for
an opportunity to assign this question, and all starred MyLab questions, to a student
discussion board.

2-19 Henry and Becky Thompson are planning to open a new floral and gift shop in

Orlando, Florida. They want to project a trendy, upscale, and fashionable
image. They are trying to decide on a name and logo. What should be the name
of the company? What kind of logo should be developed?

Student answers will vary based on their personal response. Refer to the MyLab for
an opportunity to assign this question, and all starred MyLab questions, to a student
discussion board.

2-20. Brand image affects purchase decisions. Identify two brands you consider to

hold a positive image, and explain why. Identify two brands that you believe
should either change or rejuvenate their brand images, and explain why. How
can the change or rejuvenation be accomplished for each brand?

Student responses will vary by brands chosen. This should be a good question for
in-class discussion.

2-21. Identify a brand that you have recently purchased that is not well-
known, but you like. Using the concepts presented in the “Building Powerful

Brands” section of this chapter, discuss how the brand you identified can be
built into a powerful brand. Be specific.

Student answers will vary.

Student answers will vary based on their personal response. Refer to the MyLab for

an opportunity to assign this question, and all starred MyLab questions, to a student
discussion board.

2-22. Identify five different brands for which you have a high level of brand loyalty.
Describe your level of loyalty and discuss why you are loyal. Explain how
brand equity impacts your loyalty for each brand.

Student answers will depend on brands chosen.

2-23. Pick a private label that you have recently purchased. What is your
evaluation of the private brand quality compared to national brands? The
chapter discussed a number of changes in private label branding that has
occurred (see Figure 2.19). Discuss each of these changes in relation to the
private brand you picked.

Student answers will depend on the brand chosen.

Student answers will vary based on their personal response. Refer to the MyLab for

an opportunity to assign this question, and all starred MyLab questions, to a student
discussion board.

2-24. Look through your cupboard and locate three packages that you believe are

effective. Describe why they are effective. Choose three labels that are
effective at capturing attention. What are the attention-getting aspects of
each label?

Student answers will depend on the packages they choose.

INTEGRATED LEARNING EXERCISES

2-25. Websites constitute an essential element of a brand’s image. Access the websites

of the following brands to get a feel for the image each brand tries to project.
Locate on YouTube an advertisement for each brand (supply the URL in your
response). Is the image projected on the website consistent with the YouTube
advertisement and the image portrayed in the other advertisements for the
brand?

a. Sonic (www.sonicdrivein.com)

b. Skechers (www.skechers.com)
c. Clinique (www.clinique.com)
d. Maxwell House Coffee (www.maxwellhousecoffee.com)

Student opinions will vary. This can be a good in-class discussion question,
especially if the sites can be posted for students to see.

2-26. A leading consulting firm that has been a leader in extending marketing

knowledge and in the area of brand development is the Boston Consulting
Group. Other companies who have been actively involved in brand
development are Lexicon Branding and Corporate Branding. Access each
firm’s websites. Describe the services provided by each firm.

a. Boston Consulting Group (www.bcg.com)
b. Lexicon Branding, Inc. (www.lexicon-branding.com)
c. Tenet Partners (www.tenetpartners.com)
d. Brand Keys (www.brandkeys.com)

BCG lists branding, consumers, corporate development, deconstruction, diversity,

e-commerce, energy, financial services, globalization, health care, industrial good,
information technology, operations, organization, pricing, retail, strategy,
technology & communications, and travel & tourism.

Lexicon lists technology, automotive, and “pharma.”

Tenet Partners offers research and analytics, brand strategy assistance, design
assistance, and digital marketing activities.

Brand Keys describes itself as, “The World Leader in Customer Loyalty and
Engagement Metrics.”

2-27. Brand extension and flanker branding are common strategies for large

corporations. Access the following websites. Identify the various brand
extension strategies and flanker brands used by each company.

a. Procter & Gamble (www.pg.com)
b. VF Corporation (www.vfc.com)
c. (www.generalmills.com)

P & G’s brands are noted in the chapter. In 2005, the company announced the
acquisition of Gillette.

VF Corporation includes Wrangler, Lee, Vassarette, JanSport, and The North
Face.

General Mills lists 14 brand categories and a wide variety of names.

2-28. Private labels provide a significant source of revenue for many retail stores

and manufacturers. The Private Label Manufacturers’ Association promotes
manufacturers that produce private labels. Visit the organization’s website at
www.plma.com. Access each item on the menu. Summarize the information
provided for each item.

These will change as the site is updated.

2-29. Conduct an internet search for brand logos. Identify five logos that you think

are well designed. Screen-capture the logos and explain what you think
makes each logo effective. Identify five logos that you think are poorly
designed. Screen-caputrethem and explain why you think they are
ineffective.

Answers will vary depending because websites tend to change on a regular basis.

2-30. Go to the authors’ website at clowbaack.net/video/ads.html. Watch a television

ad for each of the medical institutions: DuPage Medical Group, Terrebonne
General Medical Center, and St. Francis Medical Center. For each of the TV
ads, identify the primary message of the ad and the image conveyed by the TV
ad. Be specific in describing each medical facility’s image. If you had to choose
among the three for medical services, which would you choose? Why?

Student answers will depend on the advertisements they choose.

2-31. Go to the authors’ website at clowbaack.net/video/ ads.html. Watch a television
ad for each of the financial banking institutions: JD Bank, Ouachita
Independent Bank, Progressive Bank, and Centric Federal Credit Union. For
each of the TV ads, identify the primary message of the ad and the image
conveyed by the ad. Be specific in describing each financial institution’s image.
If you had to choose among the four for banking services, which would you
choose? Why?

Student answers will depend on the advertisements they choose.

BLOG EXERCISES
Access the authors’ blog for this textbook at the URLs provided to complete these
exercises. Answer the questions that are posed on the blog.

2-32. Kenmore, Craftsman, and Diehard: http://blogclowbaack.net/2014/05/07/private-

brands-sears-chapter-2/
2-33. Target: http://blogclowbaack.net/2014/05/07/target-chapter-2/
2-34. Branding: http://blogclowbaack.net/2014/05/07/branding-chapter-2/

These exercises provide you with an additional tool to engage your students.

Student Project: Creative Corner

The assignment is to develop a brand name, package, and label for a variety of products,
including the following:

a. A new brand of skis for recreational boating
b. A new line of eyeglasses
c. A new chocolate candy bar
d. A new line of jeans
e. A new energy drink
f. A new perfume or cologne

Individual student answers will vary widely.

Cases

Case 1 Product Names

2-35. What type of product name is VitaMints? MultiGummies? Do you think such
names will succeed? Why or why not?

The names are descriptive of contents. Student perceptions of their potential for
success will vary.

2-36. Should the Centrum brand be emphasized in marketing VitaMints, or should
the product name stand alone in the promotional program? Defend your
answer.

The Centrum brand is fairly strong and should probably be emphasized.

2-37. Do you think marketing messages for VitaMints and Centrum MultiGummies
should focus on the products themselves or make comparisons with other
vitamin products, such as One a Day?

Both approaches have value. Student answers will vary.

2-38. Design an advertising campaign for VitaMints or Centrum MultiGummies that
will follow the introductory launch stage. Identify the product features and
brand characteristics that should be emphasized to create brand equity and
customer loyalty over time.

Student campaigns will vary. Characteristics might include being “better” in some
way, more fun, easier to chew, and so forth.

Case 2 Brand Alliances and Brand Resurrections

2-39. Provide an analysis of the brand alliances mentioned in this story. What

factors shape your perceptions of the brands involved?

Student answers will vary. Factors that shape perceptions include past experiences
with the companies involved, both positive and negative.

2-40. In each of the brand alliances, which of the two co-brands do you believe is

the more powerful name? What causes you to hold that perception?

This can be a discussion question. Ideas about the more powerful brand will be based
on consumer preferences, in this case, the students involved.

2-41. Can you think of any potential disadvantages of brand alliances? Explain

your answer.

Negative publicity toward one of the co-brands could hurt the other.

2-42. Do you recall the names Datsun, Dodge Dart, or Taurus? What perceptions

do you have of those brands? Ask your parents what they think of those
brand names. Are their answers different from yours?

Most students will not recall the names unless their parents owned one of the cars.

2-43. Describe what you believe are potential advantages and disadvantages of

brand resurrections.

Potential advantages include being able to use nostalgia and recall to enhance the
brand.

Previous negative experiences could create a disadvantage, as could the belief that the
brand is simply old or stale.

MyMarketingLab
Go to mymktlab.com for the answers to the following Assisted-graded writing
questions:

2-44. Brand image affects purchase decisions. What brands do you consider to
hold a positive image? Why? Which brands should attempt to change brand
images? Why? Explain how to accomplish this task. Which brands do you
believe need rejuvenation? How can it be accomplished for each brand?

2-45. Look up each of the following brands on the internet. Discuss the image
conveyed by each brand’s website. What positioning strategy is used? Justify
your selection. What changes or improvements could these brands make to
their website to enhance its appeal?
a. Canyon Beachwear (www.canyonbeachwear.com)
b. Applebee’s (www.applebees.com)

Bonus Case

A HEALTHY IMAGE

Mary Wilson was both nervous and excited as she opened her first staff meeting in the

marketing department of St. Margaret’s General Hospital. Mary’s new role was director

of marketing and communications. Her primary task was to increase the visibility of St.

Margaret’s Hospital in order to raise the image of the institution in the eyes of the many

publics served. The long-term goal was to attract the best possible physicians while

increasing use of the hospital’s facilities and attracting more patients.

The world of health care changed dramatically in the past decade. Government

regulations and support, concerns about lawsuits, evolving and expensive technologies,

and changes in health insurance provisions affected hospitals of all sizes. In addition, St.

Margaret’s faces strong competition. The hospital’s primary location is in a major

metropolitan area in Minnesota. Two other large hospitals also offer comparable services

in the same city. Each seeks to sign physicians to exclusive contracts in which they will

only provide care with one organization.

The other significant challenge to St. Margaret’s is its proximity to the Mayo Clinic.

Clearly, Mayo holds the highest level of prestige in the state and even in the region. Most

physicians are inclined to think of Mayo first when making referrals for patients with

difficult medical problems. Mayo would be viewed by most publics as the “best” care

possible.

The key issues in the image of any health organization include developing trust and a

feeling of confidence in the quality of care that will be received. Beyond technological

advantages, other, more subtle elements of an image could have an influence. Mary noted

that the nurse plays a primary role in determining how patients view hospitals. An

uncaring and inattentive nurse is likely to drive away both the patient who encountered

the nurse and all of that patient’s family and friends. Negative word-of-mouth, Mary said,

must be held to an absolute minimum.

Mary believed St. Margaret’s needed to overcome two problems. First, the name

“Margaret” is not commonly used anymore. Some publics may view it as an “old-

fashioned” name. Second, there was nothing distinctive about the hospital’s image. The

overlap in services provided (heart care, cancer treatment) made it difficult to

differentiate St. Margaret’s from other providers.

If there was any advantage, Mary believed it was that St. Margaret’s was affiliated

with the Catholic Church. It was the only nonprofit hospital of the three major

competitors. This attracted both Catholic patients and some Catholic physicians. Also, the

hospital was able to utilize the services of a wide variety of volunteers.

As the marketing meeting opened, the agenda was to discuss all of the ways St.

Margaret’s could build its client base. The task would not be easy, but everyone in the

room believed the hospital offered high-quality services in a caring atmosphere.

A Healthy Image

What are the image issues in this case?

St. Margaret’s knows the hospital cannot be the “best.” The other problem is brand
parity relative to the other hospitals in the city.

What are the brand name issues?

St. Margaret’s is viewed as an “old fashioned” name.

What types of advertisements should Mary develop for St. Margaret’s Hospital?

Ads that emphasize the organization’s advantages, including caring service,
nonprofit status, and possibly the hospital’s Catholic heritage.

What other types of activities could St. Margaret’s pursue to build a strong and
positive corporate image?

Health fairs and community service projects. Outreach programs for the homeless
and those without health insurance.

Chapter 1

Integrated Marketing Communications

CHAPTER OBJECTIVES

Students should be able to answer the following questions:

1.1 How does communication take place?
1.2 What is an integrated marketing communications program?
1.3 What trends are affecting marketing communications?
1.4 What are the components of an integrated marketing communications program?
1.5 What is meant by GIMC?

OVERVIEW

Advertising and promotion face a rapidly shifting landscape. A decline in traditional media
viewing combined with the rise in internet usage and the use of social media have created a
new order.

Effective advertising and marketing campaigns often now involve more than one well-made
commercial because such a wide variety of media is available.

Current advertising and marketing methods range from simple stand-alone billboard
advertisements to complex, multilingual global websites.

Lean Cuisine

How do you convince consumers that the same product should be viewed in a different way?
The marketing team realized that the term “diet” was fading in usage and popularity.

Nestle, ConAgra, Kellogg, and General Mills jointly launched a three-year, $30 million
image campaign entitled “Frozen. How Fresh Stays Fresh.” The idea was to convince
consumers, many of whom had begun to strongly prefer fresh food over frozen, that the latter
was equally tasty and healthy.

Every element of this new approach sought to generate a change in consumer perceptions of
a longstanding product, noting that in FDA standards the word “lean” means food items
cannot contain more than 10 grams of fat.

Questions for Students:

1. What do you think of when you hear the term “diet” food? Will these

companies be able to change your perception?
2. Did you see this campaign? What was your reaction?
3. Do you think using social media will work in this instance? Why or why

not?

This chapter explains the nature of an integrated advertising and marketing communications
program.

First, communication processes are described. Understanding how communication works
builds the foundation for an integrated marketing program.

Also, the trends affecting marketing communications are noted.

Next, an integrated marketing communications program is described.

Finally, the integrated marketing communications process is applied to global or international
operations, creating a globally integrated marketing communications (GIMC) program.

Objective 1.1: How does communication take place?

The Nature of Communication

Communication is defined as transmitting, receiving, and processing information. The parts
of a communications model are displayed in Figure 1.1. Components that should be
discussed include:

• Sender—the person(s) attempting to deliver a message or idea

• Encoding processes—the verbal (words, sounds) and nonverbal (gestures, facial
expression, posture) cues that the sender utilizes in dispatching the message

• Transmission device—all of the items that carry the message from the sender to
the receiver

• Decoding—takes place when the receiver employs any set of his or her senses
(hearing, seeing, feeling, etc.) in the attempt to capture the message

• Receiver—the intended audience for a message

• Feedback—information the sender obtains from the receiver regarding the
receiver’s perception or interpretation of a message

• Noise—anything that distorts or disrupts a message

Figure 1.1 A Model of Communication

A message, from a company such as Chick-fil-A, is being prepared by the Sender.

Encoding processes include all of the verbal and nonverbal cues that are part of the
marketing message.

Messages travel to audiences via various transmission devices, such as a television,
billboard, Sunday paper with a coupon, or a letter to the purchasing agent of a large retail
store.

Decoding occurs when the receiver’s (consumer’s) senses are touched in some way by the
message.

Feedback occurs through inquiries, trips to the store, and purchases.

Noise is all of the factors that prevent the consumer from seeing the message. A classic
example is clutter, which exists when consumers are exposed to hundreds of marketing
messages per day and most are tuned out (see Figure 1.2)

Figure 1.2 Displays examples of communication noise that affect television.

Question for Students: Can you think of additional examples of noise in advertising
or marketing communications?

Objective 1.2: What is an integrated marketing communications program?

Integrated Marketing Communications

Integrated marketing communications (IMC) is the coordination and integration of all
marketing communication tools, avenues, and sources in a company into a seamless program
designed to maximize the impact on customers and other stakeholders.

The program should cover all of a firm’s business-to-business, market channel, customer-
focused, and internally directed communications.

The marketing mix consists of

• Products
• Pricing systems
• Distribution systems
• Promotional programs

The promotions mix consists of
• Advertising
• Sales promotions (including consumer and trade promotions)
• Personal selling activities

The IMC promotions mix also includes

• Database marketing
• Direct response marketing
• Online marketing
• Social media
• Guerilla marketing
• Alternative marketing
• Public relations programs

Figure 1.3 Displays all of these elements.

Figure 1.4 Lists the steps required to complete a marketing plan.

1. Situational analysis (examining problems and opportunities in the organization’s
external environment and strengths and weaknesses in the firm itself)

2. Defining marketing objectives (sales, market share, competitive position, and
customer actions desired)

3. Budget preparation

4. Finalizing marketing strategies and tactics

5. Evaluation of performance

Objective 1.3: What trends are affecting marketing communications?

Emerging Trends in Marketing Communications

Figure 1.5 Illustrates current trends affecting marketing communications

Emphasis on Accountability and Measurable Results

Advertising agencies are expected to produce tangible outcomes. Promotional dollars must
be spent carefully.

Many companies have switched from 30-second television spots to digital, social, and
alternative communication messages. These messages are combined with special events
where names, profiles, and addresses of prospective customers can be collected and tracked.

Integration of Digital Media

Smartphones, tablets, and text-messaging systems have created a new landscape and, in some
cases, nearly a new language.

These digital marketing techniques seek to create experiences with a brand rather than mere
purchases with little or no emotional attachment. Companies using these techniques include
the following:

• Procter & Gamble (P&G)
• AT&T
• Johnson & Johnson
• Kraft Foods
• Toyota

When P&G introduced its Star Wars limited edition CoverGirl products, the company
utilized Snapchat and geo-targeted advertising to drive in-store sales.

Integration of Media Platforms

Today’s consumers spend an average of 5 hours and 16 minutes in front of screens other
than television.

When combined with television (which consumers watch for an additional 4 hours and 31
minutes per day), the total becomes more than 10 hours per day examining some kind of
screen.

Figure 1.6 Four ways consumers interact across multiple media formats:

• Content grazing involves looking at two or more screens simultaneously to access
unrelated content, such as watching TV and texting a friend at the same time.

• Investigative spider-webbing occurs when consumers pursue or investigate
specific content across multiple platforms, such as watching a football game and
accessing stats for various players on a PC or mobile phone.

• Quantam journey focuses on completing a specific task, such as when a consumer

looks for a Chinese restaurant using a PC to locate one in the area, then obtains
consumer reviews of the units close by on a smartphone, and finally employs a
map app to locate the restaurant or to place an order.

• Social spider-webbing occurs when consumers share content or information

across multiple devices, such as by posting pictures on Facebook from a laptop
then texting friends to go check out the posts.

Changes in Channel Power

Retailers seek to maintain channel power by controlling shelf space and purchase data that
allows them to determine which products and brands are placed on store shelves.

Fifty-seven percent of consumers say they will not buy a particular brand after just one
negative experience, and 40 percent are likely to tell others not to purchase that brand.

Consequently, the internet and information technology have shifted more power to the
consumer.

Understanding shifts in channel power has become essential. Marketers cannot rely solely
on mass media advertising. They must incorporate social media and engage consumers
with their brands.

The same principles apply to business-to-business purchasing activities.

Increases in Global Competition

Consumers can purchase goods and services from anyplace in the world. Competition no
longer comes from the firm just down the street—it can also come from a firm 10,000 miles
away.

This shift affects manufacturers, retailers, and intermediaries. Customers want both value
and price. Quality relationships between members of the marketing channel help to acquire
and keep customers.

Increases in Brand Parity

Many products have nearly identical benefits. When consumers believe that most brands
provide the same set of attributes, the result is brand parity. This means shoppers will
purchase from a group of accepted brands rather than one specific brand.

Marketers must generate messages in a voice that expresses a clear difference.

They must build some type of perceived brand superiority for the company and its products
or services.

Emphasis on Customer Engagement

A contact point is any place where customers interact with or acquire additional information
about a firm.

Customer engagement programs often utilize digital media; however, they should also
become part of a more integrated marketing approach.

The Role of Integrated Marketing Communications

Effective integrated marketing communications ensures a brand’s target audiences hear
the same message across all traditional and new media channels.

Each piece of a campaign should be driven by a single strategy that guides the creative
development process.

An integrated approach times the release of individual campaign components in a manner
that maximizes a customer’s journey from awareness to purchase.

Figure 1.7 Five reasons why integrated marketing communication works

Objective 1.4: What are the components of an integrated marketing
communications program?

IMC Components and the Design of This Text

Figure 1.8 An overview of the integrated marketing communications model

The foundation of the IMC plan includes

• Corporate and brand management (Chapter 2)
• Analysis of buyer behaviors (Chapter 3)
• The IMC planning process (Chapter 4)

Advertising includes

• Advertising campaign management, including the major functions of all those
involved in an advertising campaign, advertising goals, and advertising theories
(Chapter 5)

• Advertising design focused on message strategies, appeals, executions, and

spokespersons (Chapter 6)
• Traditional media channels, including television, radio, magazines, newspapers,

outdoor signs, and direct mail (Chapter 7)

Digital and alternative include

• Digital marketing integratation of e-commerce programs with recent trends in
interactive marketing, such as online advertising, search engine optimization,
and mobile advertising (Chapter 8)

• Social media and new trends in the area (Chapter 9)
• Alternative marketing programs, including buzz marketing, guerilla marketing,

product placements, branded entertainment, and lifestyle marketing (Chapter 10)

Selling components include
• Database, direct response programs, and personal selling (Chapter 11)
• Sales promotions (consumer and trade promotions) (Chapter 12)
• Public relations and sponsorships (Chapter 13)

Integration includes

• Regulations and ethics (Chapter 14)
• IMC evaluation (Chapter 15)

Objective 1.5: What is meant by GIMC?

International Implications

In the past, marketers had two different strategies for global companies. One was to
standardize the product and message across countries. The second is called adaptation, in
which the product and message are customized for each region.

The globally integrated marketing communications (GIMC) approach is easier to apply
when a company has relied on the standardization method; however, GIMC can and should
be used with either standardization or adaptation.

In terms of marketing, perhaps the best philosophy to follow is “market globally but act
locally.”

Note to Professors:

The MyLab feature at Pearson will grant you access to the Integrated Campaigns in Action
within the Instructor’s Resource section.

The authors’ blog for professors and students may be found at http://blogclowbaack.net/

Both methods contain actual print materials produced for the campaign. Broadcast material
such as video ads, TV ads, and radio ads are embedded using YouTube and Pearson
servers.

IMPLICATIONS FOR MARKETING ACCOUNT EXECUTIVES

(Note to professors— these materials are not in the text. They provide a method for
you to summarize the chapter in a different way)

Describe the role of marketing account executive to students. This individual is in charge of
the connection between an advertising agency and a client company. Review the following
ideas:

Account executives are going to be asked to justify how marketing funds are being spent.
Therefore, three things are important:

1. Make sure that all marketing efforts focus on an integrated theme.
2. Establish clear-cut marketing objectives in the area of communication.
3. Recognize the difference between short-term outcomes (immediate sales,

coupon redemptions, internet “hits”) and longer term brand equity and company
image issues. Both are vital components in the marketing success of a firm over
time.

Remember that because account executives are being held accountable, they also tend to
hold more power. Effective use of this power would include the following:

• Careful selection of creatives who will stay focused on company themes,
objectives, and desired outcomes.

• Realistic expectations when designing campaigns so that they do not “oversell”
anticipated outcomes.

• Precisely tuned measurement instruments that provide clear information
regarding success and failure rates for individual marketing communications
campaigns.

Account executives should be reminded of several points from the communications model:

1. How the communications process works
2. What can go wrong (clutter, poor media selection, etc.)

3. Ways to overcome clutter and send a clear, coherent message to all concerned

Account executives must be aware of the technologies and alternative media available for
sending and receiving messages. These include the following:

• Social networks
• Blogs
• Buzz marketing
• Guerilla marketing
• Lifestyle marketing

Account executives must utilize the total IMC approach.

• Note that it is a building process that begins with an effective overall marketing
plan.

• Conceptualize advertising as part of the IMC program, and fit other marketing
activities together with ads to construct a more powerful approach to the
promotions part of the marketing mix.

• Discover ways to incorporate IMC efforts to make better contacts with those
internal to the company (employees, other department heads, management
teams, etc.).

• Watch for shifts in channel power, especially when customers have clearly
established the ability to make decisions by seeking out information on their
own (through websites, personal visits, responses to advertisements, and so
forth).

• The account executive must rethink methods to reach consumers in ways which
keep the company at the forefront as they make purchase decisions.

• Focus on ways to make an IMC message a global message. This involves
keeping a theme intact although adapting that theme to the requisites of
individual countries and cultures.

REVIEW QUESTIONS

1-1. Define communication. How does it play a crucial role in marketing and
business?

Communication may be defined as transmitting, receiving, and processing
information. It is critical to business because through communication businesses
make contact with potential customers and complete transactions.

1-2. What are the parts of an individual communications model?

The parts of the individual human communications model are as follows:
Senders—the persons or companies sending messages

Encoding—transforming an idea to an attention-getting form, such as through an
advertisement or personal (e.g., personal selling) medium

Transmission devices—occurs when a channel or medium delivers the message
through the channel

Decoding—occurs when the receiver’s senses are touched in some way by the
message

Receivers—the person who receives the message as encoded by the sender

1-3. Who are the typical senders in marketing communications? Who are the

typical receivers?

The typical senders in the communications model are companies seeking to sell a
product or idea.

The typical receivers in the communication model are potential customers who are
looking to buy the product.

1-4. Name the transmission devices, both human and nonhuman, that carry

marketing messages.

Transmission devices include television advertisements, billboards, and coupons
from a Sunday paper (nonhuman). They also include people (humans) telling other
people about an advertisement and other messages.

1-5. Define clutter. Name some of the forms of clutter in marketing

communications.

Clutter is the most common form of noise in the marketing communications. It
occurs when receivers are exposed to many different messages (television, radio,
billboards, bunches of ads in the Wednesday paper, etc.) in one day and therefore
some messages get tuned out.

1-6. Define integrated marketing communications (IMC).

Integrated marketing communications as the coordination and integration of all
marketing communication tools, avenues, and sources in a company into a seamless
program designed to maximize the impact on customers and other stakeholders. The
program should cover all of a firm’s business-to-business, market channel,
customer-focused, and internally-directed communications.

1-7. What are the four parts of the marketing mix?

The four parts in the marketing mix are taken from product, price, promotion, and
distribution. This book concentrates on the promotions mix through advertising,

personal selling, consumer and business-to-business promotions, publicity, and
direct marketing.

1-8. What steps are required to write a marketing plan?

The steps in writing a marketing plan are
o Situation analysis
o Marketing objectives
o Marketing budget
o Marketing strategy and tactics
o Evaluation

1-9. What trends were given to explain the growth in importance of IMC plans in

this chapter?

Trends include the an emphasis on accountability, the explosion of digital media,
integration of media platforms, changes in channel power, increases in global
competition, increases in perceptions of brand parity, and an emphasis on customer
engagement.

1-10. How has the explosion of the digital arena impacted marketing
communications?

Digital media has created a new landscape and, in some cases, nearly a new
language. Digital marketing techniques seek to create experiences with a brand rather
than mere purchases with little or no emotional attachment. It cannot be considered as
an option for companies, but rather as a mandatory ingredient. Marketers now seek to
engage a brand with all current and prospective customers in order to achieve
success.

1-11. Identify and describe the four ways consumers can interact with multiple

media formats.

Content grazing involves looking at two or more screens simultaneously to access
unrelated content, such as watching TV and texting a friend at the same time.

Investigative spider-webbing occurs when consumers pursue or investigate
specific content across multiple platforms, such as watching a football game and
accessing stats for various players on a PC or mobile phone.

Quantam journey focuses on completing a specific task, such as when a consumer
looks for a Chinese restaurant using a PC to locate one in the area, then obtains
consumer reviews of the units close by on a smartphone, and finally employs a
map app to locate the restaurant or to place an order.

Social spider-webbing occurs when consumers share content or information
across multiple devices, such as by posting pictures on Facebook from a laptop
then texting friends to go check out the post.

1-12. What is channel power? How has it changed in the past few decades?

Channel power is who has the most influence in the marketing channel. It has
changed because of technology, which has shifted power from producer to the
retailer and the final consumer.

1-13. What is brand parity? How is it related to successful marketing efforts?

Brand parity is a situation in which consumers believe that many brands offer the
same set of attributes. The result is that consumers will purchase from a group of
accepted brands rather than one specific brand. Successful marketing overcomes this
problem by making one brand seem better or more preferable.

1-14. Identify the role of integrated marketing in relation to new marketing trends.

Effective integrated marketing communications ensures a brand’s target audiences
hear the same message across all traditional and new media channels.

Each piece of a campaign should be driven by a single strategy that guides the
creative development process.

An integrated approach times the release of individual campaign components
in a manner that maximizes a customer’s journey from awareness to purchase.

1-15. What is a contact point? How do marketers link contact points to

customer engagement?

A contact point is any place where customers interact with or acquire additional
information about a firm. Customer engagement programs often utilize digital media;
however, they should also become part of a more integrated marketing approach.

1-16. What are the components of an integrated marketing communications

program, as outlined in this textbook?

The IMC foundation includes corporate and brand management, understanding
buyer behaviors, and communications research.

Advertising management programs include campaign management, design issues,
and the selection of traditional media.

Digital and alternative programs include digital marketing, social media, and
alternative marketing.

Selling components include database, direct response programs, and personal
selling, sales promotions, and public relations and sponsorships.

Integration includes regulations and ethics along with IMC evaluation.

1-1. What is a GIMC? Why is it important for multinational firms?

GIMC is a globally integrated marketing communications program. A GIMC
program has the same goals as IMC except on a larger scale. These programs are
important for companies that choose to compete internationally, so that the firm’s
unified message is presented effectively in other nations and regions.

1-18. What is the difference between standardization and adaptation in GIMC
programs?

The difference between standardization and adaptation is how the product is
marketed. Standardization means the company sells the same product in different
countries and maintains the same basic message. Adaptation means adjusting the
message for various individual countries or regions. Both can be a part of a GIMC
program.

CRITICAL THINKING EXERCISES

Discussion Questions

1-19. The Lean Cuisine effort to shift consumer perceptions of frozen products

included a multi-faceted approach. Access the firm’s website and evaluate
the marketing messages presented. Do they convince you to reconsider
your views of various products? Is the effort working, or do you still
perceive Lean Cuisine to just be “diet” food? Explain your answer.

Student answers will vary. Some will say the approach does work; others will say it

does not. Ask students to defend their responses.

1-20. The marketing director for Tempur-Pedic mattresses is assigned the task of

emphasizing the mattress’s superior sleep quality in the company’s next
integrated marketing communications program. Discuss the problems the
director might encounter in each step of the communication process since the
campaign will emphasize something consumers cannot see or observe. Explain
how noise or clutter interferes with the communication process.

Student answers will vary based on their personal response. Refer to the MyLab for

an opportunity to assign this question, and all starred MyLab questions, to a student
discussion board.

Students should refer to the communication process illustrated in Figure 1.1 for
ideas. In the discussion, students may note several things. The marketing director
may run into problems if the company is already known in some other way. In
essence, the sender is being misinterpreted. Encoding problems would include the
use of language in commercials. Transmission problems consist of any breakdown
in the actual movement of the message (website crash, radio station off-the air, etc.).
Decoding may be an issue if the receiver is impaired. Also, noise in various
marketing channels could prevent the advertiser from being able to change
consumer’s minds.

1-21. What do you typically do during commercials on television? What
percentage of the time do you watch commercials? What makes you watch?
Ask these same questions of five other people. What type of activities do people
engage in during commercials?

Student answers will vary. The best in-class part of this question would be about
what makes a person watch or not watch a commercial.

1-22. Examine the four ways consumers interact across multiple media formats.

Which best describes you? Explain why.

Student answers will vary based on their personal response. Refer to the MyLab for

an opportunity to assign this question, and all starred MyLab questions, to a student
discussion board.

Student answers will vary. The four ways are as follows:

o Content grazing involves looking at two or more screens simultaneously to
access unrelated content, such as watching TV and texting a friend at the same
time.

o Investigative spider-webbing occurs when consumers pursue or investigate
specific content across multiple platforms, such as watching a football game
and accessing stats for various players on a PC or mobile phone.

o Quantam journey focuses on completing a specific task, such as when a

consumer looks for a Chinese restaurant using a PC to locate one in the area,
then obtains consumer reviews of the units close by on a smartphone, and
finally employs a map app to locate the restaurant or to place an order.

o Social spider-webbing occurs when consumers share content or information
across multiple devices, such as by posting pictures on Facebook from a
laptop then texting friends to go check out the post.

1-23. The use of social media has exploded during the last decade. Discuss your

personal use of social media. Which social media platforms do you use? Why
did you select those particular ones? How do you use social media?

Student answers will vary based on their personal response. Refer to the MyLab for
an opportunity to assign this question, and all starred MyLab questions, to a student
discussion board.

Student answers will vary. This is a good in-class discussion question.

1-24. Explain how advances in information technology and communication have

increased global competition for goods and services. How has the increased
global competition, in turn, impacted brand parity, the need for customer
engagement, and changes in channel power? Be specific by identifying
examples to illustrate your thoughts.

Student answers will vary based on their personal response. Refer to the MyLab for
an opportunity to assign this question, and all starred MyLab questions, to a student
discussion board.

Global competition makes brand equity more difficult to achieve. At the same time,
the fact that something is made in another country will influence perceptions of
brand parity. Customer engagement will likely be more difficult when a company
operates from another country. Consumer channel power continues to grow with
increasing choices of brands.

1-25. Brand parity has become a major issue for companies. Identify three product

categories in which the brand you purchase is not very important. Why is the
brand not important? Identify three product categories in which the brand is
important. What brand or brands do you typically purchase in each category?
Why?

Student answers will vary based on brands chosen.

1-26. The marketing director for a manufacturer of automobile tires has been asked

to integrate the company’s global marketing program. Should the director use
a standardization or adaptation approach? How could the company’s
marketing team be certain that their marketing program would be effectively
integrated among the different countries in which it sells tires?

The marketing director, in choosing whether to use a standardization or adaptation
approach, should look at the type of product being sold as well as regional
differences. If the tires are exactly the same, this would suggest a standardization
approach. If the tires are adapted to regional conditions, then the message may need
to be adapted. Also, marketing managers should always be aware of communication
and cultural differences in various countries, suggesting at least a degree of
adaptation for a standardized message.

INTEGRATED LEARNING EXERCISES

1-27. Examine the advertisement for JD Bank in the section entitled “The Nature of

Communication.” Explain each of the steps in the communication process
(Figure 1.1) in terms of the JD Bank print ad. Go to the authors’ website at
clowbaack.net/video/ads.html. Watch the ad for JD Bank entitled “JD Gets
Me.” Explain each of the steps in the communication model in relation to this
television ad.

JD Bank is the sender. The message is the ad itself. The transmission device is

whichever format carriers the ad. Decoding occurs as the consumer encounters the
message. Consumers are receivers. Feedback includes any responses, such as
inquiries or visits to the bank. Noise is any clutter that would prevent the consumer
from encountering the message.

1-28. Access the website of Chick-fil-A at www.chickfila.com. Access the websites of

Chick-fil-A’s competitors: KFC (www.kfc.com), Popeye’s (www.popeyes.com),
Church’s Chicken (www.churchschiken.com), and Bojangles
(www.bojangles.com). Identify the social media used by each brand. Compare
and contrast the information available and the design of each company’s
website. Which website did you like the best? Why? Which one did you like the
least? Why?

Student answers will vary by site chosen at the time.

1-29. Pick one of the brands listed. Access the brand’s website. Identify the social
media that is listed on the brand’s website, then access each of the social media
pages. Go to YouTube and locate a TV ad of the brand. Discuss how well the
website, social media sites, and ad you located on YouTube are integrated.
(Provide the URLs for the website, social media sites, and TV ad).

a. JD Bank (www.jdbank.com)
b. Red Lobster (https://redlobster.com)
c. Salvation Army (http://www.salvationarmy.org)
d. Visit South Walton (www.visitsouthwalton.com)

Student answers will vary based on the site and its current information.

1-30. Information is one key to developing a successful integrated marketing

communications program. Access each of the following websites. Describe the
type of information and news available on each site. How would this
information help in developing an integrated marketing campaign?
a. Brandweek (www.brandweek.com)
b. Adweek (www.adweek.com)
c. Mediaweek (www.mediaweek.com)
d. Branding Asia (www.brandingasia.com)

Student answers will vary based on the site and its current information.

BLOG EXERCISES

Access the authors’ blog for this textbook at the URLs provided to complete these
exercises. Answer the questions posed on the blog.

1-31. American Eagle, http://blogclowbaack.net/2015/12/03/american-eagle-

chapter-1

1-32. Chick-fil-A, http://blogclowbaack.net/2014/04/24/chick-fil-a-chapter-1

1-33. Integrated marketing, http://blogclowbaack.net/2014/04/24/imc-chapter-1

These exercises provide you with an additional tool to engage your students.

Student Project: Creative Corner

This is an analysis of advertising for Red Robin restaurant, including social media
components.

CASES

Case 1 Mike’s Old-Time Ice Cream and Chocolate Shop

1-34. Mike’s store will be a local business that competes with large national

companies. What communication challenges does that present? What
opportunities does it offer?

Communication challenges would include trying to compete with more established
brands and companies that may be able to spend more on advertising and marketing
programs.

Communication opportunities include the ability to tailor products and messages to
the local audience and emphasize that the company is local.

1-35. Which of the emerging trends in marketing communications can Mike use to

promote his new business? Explain how it can be used.

The integration of digital media and digital platforms offers many opportunities for
Mike to go beyond a website and add other methods for reaching customers. Changes
in channel power reflect the role consumers play in making choices, which could also
work to his advantage. Increases in brand parity emphasis may mean that people view
national chains as being essentially similar or close to the same; Mike could try to
differentiate from that. Customer engagement provides the best opportunity for a
local company. Without it, Mike will soon be out of business.

1-36. What should be the first message that Mike should try to communicate to all

potential customers? Should he emphasize price, value, or some other
element of his business?

Student answers will vary. They should emphasize value and a unique experience not
like national ice cream stores.

1-37. Will Mike be able to use social media in his marketing communications

efforts? If so, how? If not, why not?

Students should agree that social media can be an important element of the
company’s marketing plan. The secret will be finding venues to reach new customers
and maintain contact with ongoing customers in positive ways to build relationships
with them. This would include special loyalty deals and other enticements.

Case 2 Wake Up Call for 8:00

1-38. What coffee brands would constitute Eight O’Clock Coffee’s primary

competition?

Most students will probably note Starbucks.

1-39. Would you characterize coffee consumption as a situation in which brand

parity exists? Why or why not?

Student answers will vary, depending in part on whether the individual drinks coffee
or is a coffee snob. Those who are will likely be more brand loyal.

1-40. Examine the emerging trends in marketing communications presented in the

chapter. Which trends can Eight O’Clock coffee use to their advantage?
Explain how.

The emerging trends are
 • Emphasis on accountability and measurable results 
• Explosion of the digital arena 
• Integration of media platforms 
• Shift in channel power 
• Increase in global competition 
• Increase in brand parity 
• Emphasis on customer engagement  

Student opinions will vary. The most clear-cut factors that apply are the first and last:
The emphasis on accountability and on customer engagement.

1-41. Evaluate the value of using social media for this type of marketing

communications effort. Is it necessary or helpful? Why or why not?

Student answers will vary; however, this represents a new trend in marketing
communications and was reported to achieve some success.

MyMarketingLab

Go to mymktlab.com for the answers to the following Assisted-graded writing questions:

1-42. Reebok’s tagline is now “Be More Human.” Examine Reebok’s website
(www.Reebok.com). Define each of the components of the communication process
(see Figure 1.1). Then explain each component as it relates to the Reebok tagline
and website.

1-43. Find each of the following companies on the internet. For each company, discuss
how effective its website is in communicating an overall message. Also, discuss how
well the marketing team integrates the material on the website. How well does the
website integrate the company’s advertising with other marketing communications?

a. Revlon (www.revlon.com)
b. J.B. Hunt (www.jbhunt.com)
c. Interstate Batteries (www.interstatebatteries.com)

Bonus Case

The Cable Company

Rachel Peterson knew she faced several major challenges as she took the job of marketing

director for CableNOW. The company was the sole cable provider for six communities in

northeast Louisiana. All of the cities were essentially “licensed monopolies” in the sense that

no other cable company could compete within the city limits. In spite of this edge, however,

competition was becoming a major problem.

Satellite television was the primary competitor for CableNOW’s customers. Both

DirecTV and the Dish Network had set up operations in the six communities. The two

providers were able to charge lower prices for basic services. They had also started to

compete by offering price reductions on installations. This made switching from cable to

satellite much easier for local residents.

CableNOW’s primary selling point was in the delivery of programming during bad

weather. Thunderstorms and snowstorms completely disrupt a satellite signal. Severe weather

is common in that part of Louisiana; however, the weather events do not affect a cable

picture. CableNOW also held a competitive advantage because the company offered local

business and real estate listings to subscribers. The firm also was able to provide local radar

and weather forecasts during the “Local on the 8s” segments on the Weather Channel. The

satellite companies could not provide these special options.

When Rachel took the job, she knew another issue was about to unfold. CableNOW

had been able to transmit each city’s local channels as part of the basic cable package. Until

this year, the satellite companies could not. Dish Network was changing the mix. Dish

Network had just signed a contract to provide the local stations to subscribers. DirecTV did

not offer local stations but did offer a greater number of channels in the company’s basic

package. As a result, Rachel knew she had her work cut out as the marketing department

struggled to maintain share in each city.

(1) What image or theme should CableNOW portray to subscribers?

Probably one that suggests they are the best “local” option.

(2) Can you think of a way to emphasize the advantages CableNOW has in an

advertising program?

One option would be the local weather emphasis. Not only does the CableNOW

signal work during bad weather, it is the only way to get local radar and information
during storms.

(3) Do you believe CableNOW will survive these changes over the next 10 years?

Why or why not?

Student opinions will vary. The company does have an uphill battle.

Chapter 3

Buyer Behaviors

CHAPTER OBJECTIVES

Students should be able to answer the following questions:

3.1 What elements are involved in internal and external information searches by

consumers, as part of the purchasing process?
3.2 What three models explain how individuals evaluate purchasing alternatives?
3.3 What trends are affecting the consumer buying environment?
3.4 How do the roles played by various members of the buying center and the factors

that influence them impact business purchases?
3.5 What types of business-to-business sales are made?
3.6 What are the steps of the business-to-business buying process?
3.7 How does dual channel marketing expand a company’s customer base and its sales?
3.8 How can a company overcome international differences when adapting to buying

processes?

OVERVIEW

This chapter reviews consumer buyer behaviors and business-to-business buyer behaviors.

Consumer purchasing processes include five steps; however, two of those steps are most
important from an IMC perspective: the information search stage and the evaluation of
alternatives stage, which are described in detail in the first part of this chapter.

Next, the consumer buying environment is described.

Business buying behaviors are described starting with a description of the five major roles
played in a business buying center.

The three main types of business-to-business purchases are noted.

Finally, dual channel marketing is explained.

Nescafe

In a country dominated by tea consumption (China), creating a new mindset in which coffee
would be selected more often by younger consumers, especially in rural areas, was one key
goal. Nescafé’s marketing team decided that new technologies presented the greatest
opportunities to influence the entire buying process.

Questions for Students:

1. Do you think selling coffee in a country dominate by tea consumption is a good

idea?
2. Do you think the company will succeed using social media? Why or why not?

Objective 3.1: Which elements are involved in internal and external information

searches by consumers, as part of the purchasing process?

Information Searches and the Consumer Purchasing Processes

Marketing managers constantly endeavor to influence consumer decisions. Figure 3.1
displays the steps of the buying decision-making process. The two steps that are the most
important to IMC programs are

• Information search
• Evaluation of alternatives

After a need emerges, the consumer begins an internal search, mentally recalling products
that might satisfy it.

Often, the individual remembers how the need was met in the past. If a particular brand was
chosen and the experience was positive, the consumer repeats the purchase decision, and the
information search ends.

When a previous purchase did not work out, or the consumer wishes to try something else, a
more complete internal search may result.

Internal Search

An internal search takes place when the consumer mentally recalls images of products that
might fulfill or meet the need.

A major objective is to build equity so that the company’s brand will be recalled during an
internal search.

External Search

Following an internal search, the consumer makes a mental decision regarding an external
search.

External information comes from many sources, including the following:

• Friends and relatives
• Other consumers
• Books, magazines, newspapers, and searches of the internet
• Advertisements
• In-store displays
• Salespeople

The amount of time a consumer spends on an external search depends on the factors shown
in Figure 3.2:

1. The ability to search, which depends on the person’s educational level combined
with specific knowledge of the product category and the brands being offered.

2. Motivation, such that the greater the motivation, the greater the extent of external
search. Motivation is determined by
a. The consumer’s level of involvement (enduring versus situational)
b. The customer’s need for cognition (low versus high)
c. The customer’s level of shopping enthusiasm (low versus high)

3. Costs, the cost of the search consists of several items:

a. The actual cost of the good or service
b. The subjective costs associated with the search, including the time spent and

the anxiety experienced while making a decision
c. The opportunity cost of forgoing other activities to search for information

4. Perceived benefits of the search: higher perceived benefits increase the tendency

to search.

The four factors that make up an external search (ability, motivation, costs, and benefits) are
normally all considered at the same time.

Question for Students: Which of these four factors influences you the most when
shopping?

From a marketing communication perspective, the search process is an important time to
reach the consumer with information about a particular brand.

The goal of marketers during this stage should be to provide information that allows
consumers to make the correct decision.

Some additional concepts should be considered by marketing experts as they study the
information search process.

1. Consumer attitudes
2. Consumer values
3. Cognitive mapping

Consumer Attitudes

An attitude is a mental position taken toward a topic, person, or event that influences the
holder’s feelings, perceptions, learning processes, and subsequent behaviors.

An attitude consists of three components:

1. The affective component contains the feelings or emotions a person has about the
object, topic, or idea.

2. The cognitive component refers to a person’s mental images, understanding, and
interpretations of the person, object, or issue.

3. The conative component is an individual’s intentions, actions, or behavior.

The most common sequence of events that takes places as an attitude forms is

cognitive -> affective -> conative

There are other ways in which attitudes may develop. An alternative process may be

affective -> conative -> cognitive

Some attitudes result from a third combination of the components, as follows:

conative -> cognitive -> affective

Attitudes are shaped, in part, by an individual’s personal values.

Consumer Values

Values are strongly held beliefs about various topics or concepts and lead to the judgments
that guide personal behaviors.

By appealing to the basic values shown in Figure 3.3, marketers hope to convince
prospective customers that their products can help them achieve a desirable outcome.

In terms of consumer decision-making processes, both attitudes and values are helpful to
marketing experts.

Figure 3.4 identifies some of the brands consumers consider to be patriotic.

Cognitive Mapping

Cognitive maps are simulations of the knowledge structures embedded in an individual’s
brain.

People use knowledge structures to help them interpret new information and to determine an
appropriate response to fresh information or a novel situation.

Figure 3.5 is an example of a cognitive map of a person thinking about Ruby Tuesday.

Cognitive Linkages

Besides initial linkages, other features of cognitive maps are present. These include levels
and layers, meaning that cognitive processing occur on many levels using highly complex
mechanisms.

Processing New Information

New information affects linkages that already exist.

In situations in which a message has no current linkages, a new map will evolve in the
person’s mind.

Retaining Information

Hearing something once usually is not enough to cause it to be retained in a person’s memory
because of the difference between short-term recall and long-term memory.

New Concepts

Another way a consumer can process information is to link the message to a new concept.
The individual can add a link, ignore or forget the message, or recall the message later.

Marketing Messages

When a company attempts to introduce consumers to a new brand, the advertisements and
other marketing messages should repeat the name of the product several times during the
presentation to improve the chances it will be recalled.

Figure 3.6 displays the roles of marketing messages in cognitive mapping.

Question for Students: Can you imagine a cognitive map for one of your recent purchases?

Objective 3.2: What three models explain how individuals evaluate purchasing

alternatives?

Evaluation of Alternatives

Three models portray the nature of the evaluation process.

1. The evoked set approach.
2. The multiattribute approach.
3. Affect referral.

Figure 3.7 displays these three methods.

The Evoked Set Approach

A person’s evoked set consists of the brands that are considered in a purchasing situation.
Two additional components of evoked sets are part of the evaluation of purchase alternatives:

1. The inept set consists of the brands that are part of a person’s memory, which are
not considered because they elicit negative feelings.

2. The inert set holds the brands that the consumer is aware of but the individual has
neither negative nor positive feelings about the products.

The Multiattribute Approach

The key to understanding this model is noting that consumers often examine sets of attributes
across sets of products or brands. The multiattribute model assumes that a consumer’s
attitude toward a brand is determined by the following:

• The consumer’s beliefs about a brand’s performance on each attribute
• The importance of each attribute to the consumer

The higher a brand is rated on attributes that are important to the consumer, the more likely it
becomes that the brand will be purchased.

Figure 3.8 displays an example of a multiattribute model.

Affect Referral

With this method, a consumer chooses the brand that he or she likes the best. The individual
does not evaluate the other brands and often does not even think about which attributes are
important.

Two things explain why consumers rely on affect referral:

1. It saves mental energy.

2. The multiattribute model may have been utilized previously. Thus, the person has
already spent a great deal of time considering various product attributes, deciding
which attributes were most critical, and reaching a decision.

Question for Students: Can you remember your last purchase using an affect referral
type of approach?

Objective 3.3: What trends are affecting the consumer buying environment?

Trends in the Consumer Buying Environment

It is important to note some of the more recent trends that have affected purchasing patterns.

Figure 3.9 lists the trends.

Age Complexity

Some of the attitudes and values that are shifting at a cultural level include those associated
with the following:

• Young people “growing up” more quickly
• Older people refusing to “grow old”

Gender Complexity

Roles of males and females continue to evolve.

Active, Busy Lifestyles

Many people would prefer more time to more money and possessions. Convenience items
are in higher demand.

Diverse Lifestyles

A wide diversity exists in the adult paths individuals take and the living arrangements.

Divorce and remarriage alter many family units. Divorcees, or second chancers, tend to
develop a new outlook on life. They have higher incomes and are more content with life

The number of openly lesbian, gay, bisexual, and transgender (LGBT) has grown to
approximately 5 percent to 10 percent of the population.

Communication Revolution

Advances in telecommunications, primarily social media and smartphones, have impacted
consumers all over the world and have created significant changes in the way individuals
communicate with each other, with brands, and with companies.

These technologies have changed the way brands and firms are influenced by word-of-mouth
communication and can be used to engage consumers and stimulate positive endorsements.

Experience Pursuits

Indulgences, such as expensive dinners or get-away weekends, bring feelings of comfort and
reassurance.

Self-rewarding activities make the consumer feel that all the work and effort is “worth it.”

Health Emphasis

Two outcomes of this trend are

1. A blossoming interest in health products
2. The desire to maintain a youthful appearance

Marketers can create messages about the healthy aspects of products.

Figure 3.10 displays some of the potential responses to all of these new trends in the
consumer buying environment.

Objective 3.4: How do the roles played by various members of the buying center and the
factors that influence them impact business purchases?

Business-to-Business Buyer Behavior

Business-to-business purchases are completed by people. Many of the processes involved in
making a purchasing decision apply to both consumers and business buyers.

The group of individuals involved in the buying decision is called the buying center. The
buying center consists of five different subsets of individuals playing various roles in the
process.

The five roles involved in the buying center are shown in Figure 3.11:

1. Users are the members of the organization who actually use the product or
service.

2. Buyers are the individuals who are given the formal responsibility of making the
purchase. In larger organizations, buyers are either purchasing agents or
members of the purchasing department.

3. Influencers are the people who shape purchasing decisions by providing the
information or criteria utilized in evaluating alternatives.

4. Deciders are the individuals who authorize decisions.
5. Gatekeepers are the people who control the flow of information to members of

the buying center. The gate-keeping function can be performed by several people
rather than one individual.

Many times these five roles overlap.

• The behaviors of each member in the buying center are influenced by
Organizational factors

• Individual factors

Organizational Influences

Organizational influences include the following:

• Company’s goals
• Operating environment (recession, growth period, lawsuits pending, etc.)
• Finances and capital assets
• Market position
• Quality of the company’s human resources
• Country in which the firm operates

Some organizations have highly centralized purchasing programs although others are highly
decentralized.

Studies of organizational decision making indicate that employees tend to adopt heuristics,
which are decision rules designed to quickly eliminate as many options as possible.

One decision rule often employed is called satisficing, which means that when an acceptable
alternative has been identified, it is taken and the search is completed.

Individual Factors

At least seven major factors affect each member of the business buying center, as displayed
in Figure 3.12.

Personality

Personality features include introversion, decisiveness, forcefulness, ego.

Roles

Roles and perceived roles, influenced by age, heredity, ethnicity, and also by the role within
the buying center.

Motivation

Motivational levels, which depend on the match between the individual’s goals and the
organization’s goals.

Level of Power

The level of power depends on the person’s role in the buying center, official position in the
organization, and the impact of the purchase decision on a specific job.

Risk

Attitudes toward risk, which means many vendors are chosen because buyers believe the
choice has the lowest risk and risk avoidance is common.

Level of Cognitive Involvement

Levels of cognitive involvement means individuals with higher levels of cognitive capacity
want more information prior to making decisions and ask more questions when interacting
with a sales rep.

Personal Objectives

Personal objectives are tied to motives, personality, perceptions of risk, and the other
individual factors and can lead buyers to make purchases that help them politically in the
organization.

Objective 3.5: What types of business-to-business sales are made?

Types of Business-to-Business Sales

These decisions fall into one of three categories:

Straight rebuy, which occurs when the firm has previously chosen a vendor and
wishes to make a reorder. It tends to be a routine process.

2. Modified rebuy, where the company needs to consider and evaluate alternatives.
A modified rebuy situation can occur for four different reasons, as shown in
Figure 3.14.
• Buyers are dissatisfied with a current vendor.
• A new company offers what is perceived by a member of the buying center

to be a better buy.
• The end of a contractual agreement is reached
• When a company purchases a product or service with which they have only

limited or infrequent experience.

3. New task, where the company is buying a product or service for the first time
and the product involved is one with which they have no experience.

Objective 3.6: What are the steps of the business-to-business buying process?

The Business-to-Business Buying Process

In new task purchasing situations, companies go through seven steps in the business-to-
business buying decision process.

1. Identification of a need
2. Establishment of specifications
3. Identification of alternatives
4. Identification of vendors
5. Evaluation of vendors
6. Selection of vendor(s)
7. Negotiation of purchase terms

Figure 3.15 compares individual purchase decisions with the business buying process.

In a new buy situation, companies will go through all seven steps. In modified rebuy or
straight rebuy situations, one or more of the steps are eliminated.

Identification of Needs

Individual buyers and members of individual firms recognize company needs on a daily
basis.

Needs in the business world are often created by derived demand, which is based on, linked
to, (or derived from) the production and sale of some other consumer good or service.

Establishment of Specifications

Specifications are formulated by experts.

Specifications are usually written down and distributed internally to those in the buying
center and are communicated to vendors.

Identification of Vendors

In most business situations, written, formal bids are required.

A member of the buying center is normally chosen to compile files of vendors that submit
proposals.

The offers are circulated to all of the members of the buying center that have input into the
final decision.

Vendor Evaluation

Evaluations of vendors normally occur at three levels:

1. An initial screening of proposals
2. Undertaking a vendor audit. Members of the audit team normally include an

engineer, someone from operations, a quality control specialist, and members of
the purchasing department.

3. Sharing vendor audit information with various members of the buying center

Many of the concepts described in the previous chapter regarding consumer buyer behavior
apply to this stage of the business purchasing process.

Vendor Selection

Once the choice is made, there are still items to be completed before shipment begins,
including notifying the companies that did not win the bid.

Negotiation of Terms

In most purchasing situations, negotiating terms is merely a formality because most of the
conditions have already been worked out.

When the final agreement is set, goods are shipped and/or services are provided.

Postpurchase Evaluation

In the business-to-business arena, the postpurchase phase represents a marketing opportunity.
Vendors that provide high-quality products, follow-up, and service often move into a straight
rebuy situation.

Objective 3.7: How does dual channel marketing expand a company’s customer
base and its sales?

Dual Channel Marketing

Dual channel marketing occurs when firms sell virtually the same goods and/or services to
both consumers and businesses.

Dual marketing channels arise for several reasons.

• A product is first sold in the business market and then is adapted to the consumer
market.

• As sales grow, economies-of-scale can be created by selling to a new market.

Spin-Off Sales

One type of dual channel marketing results from spin-off sales, in which individuals who
buy a particular product at work and have positive experiences with the product purchase
another one for personal use.

Marketing Decisions

When there are substantial differences between the two channels, the typical tactics are

• Use different communication messages.
• Create different brands.
• Use multiple channels or different channels.

In most cases, business customers and consumers seek the same basic benefits from
products. In these situations, a single strategy for both markets is best. Tactics that should be
used include the following:

• Integrating communications messages
• Selling the same brand in both markets
• Scanning both markets for dual marketing opportunities

There are two advantages to integrating consumer markets with business markets:

1. Synergies
2. Economies-of-scale

Objective 3.8: How can a company overcome international differences when
adapting to buying processes?

International Implications

The importance of a powerful brand rises when a company commences with international
operations.

A visible global brand is one key to success in international business-to-business marketing.

MyMarketingLab
Go to mymktlab.com to complete the problems marked with this icon .

Note to Professors:

The MyLab feature at Pearson will grant you access to the Integrated Campaigns in Action
within the Instructor’s Resource section.

The authors’ blog for professors and students may be found at http://blogclowbaack.net/.

Both methods contain actual print materials produced for the campaign. Broadcasts
material such as video ads, TV ads, and radio ads are embedded using YouTube and
Pearson servers.

IMPLICATIONS FOR THE MARKETING TEAM

(Note to professors— these materials are not in the text. They provide a method for
you to summarize the chapter in a different way)

Recognize the opportunities that the consumer buying decision-making process identifies.
Structure the IMC program to take advantage of those opportunities.

• Know when consumers are likely to experience buying needs.
• Know how to cause customers to feel those needs, and to recall the specific

company’s products when those needs are experienced.
• Design ads and other messages that make it more likely that a given good or

service will become part of a consumer’s internal and external search for
information.

• Make the perceived benefits of finding the company greater than the perceived
costs (in the consumer’s mind).

• Tie ads to widely held consumer attitudes and values.
• Make sure ad information is consistent across potential central and peripheral

route processing of the message.
• Make sure, to whatever extent is possible, that the consumer links the firm’s

goods and services to other positive thoughts as part of his or her cognitive
mapping process.

• Market products emphasizing key features that will show up as being important
in consumer multiattribute assessments of goods and services.

•
• Provide all of the necessary postpurchase reassurance needed to keep customers

happy and loyal to the company.
• Make it easy to complete the purchase once the consumer decides on the

company. Don’t lose sales because of credit snafus, products that can only be
back-ordered, or stores that are hard to find and/or access.

Remember that, in an era of increased accountability for outcomes, the consumer buying
decision-making process is a key ingredient in success. This is because

• Purchases are about to be made, so the company needs to be ready when the
customer is on the “hot spot.”

• A consumer can go through the whole process and then actually ignore his or her
own choice when there are extenuating circumstances. Therefore, the company
would need to reduce the odds of this happening to them, and try to increase the
odds that a consumer might buy their products/services on such a last-minute
impulse.

Review all of the key factors that affect consumer purchases. Make sure ads meet those needs
effectively.

Carefully study all of the newer trends affecting consumer purchases. Features that are
increasingly important to many major target markets include the following:

• The relationship between price and value
• Distinctiveness
• Convenient access to information (websites, noticeable ads)
• Easy access when problems arise
• Effective servicing
• Ease of purchase, especially time-saving features

Business-to-Business

Know the business first. Account executives should be aware of the product type that is
being sold along with the types of customers who may purchase the product.

Carefully examine all potential customers to see if there are new potential markets that the
firm has not as yet explored

Study the nature of services that businesses provide to other business. Seek to expand the
firm’s domain by taking advantage of these services. Ask these questions:

• Are there new services the company could provide?
• Are there services the company could add to make various products more

attractive purchasing options?
• Could the company link its products with the services provided by another firm

to make both firm’s offerings more enticing?
• If the firm expands its service offerings, how can the company continue to speak

with a clear voice and integrate marketing communications messages?

Before any communications effort is designed, the account executive should work with the
company’s production department to identify all of the members of the buying center. Then,
communications should be addressed and fine-tuned according to the members of the team.

Account executives and creatives should review the steps of the business buying process.
Then, messages should be designed to have an impact on key points in the process,
depending on the product and the buyer.

• Modified rebuys require messages that will entice businesses to take a long, hard
look at their previous purchasing choices.

• New task purchases offer the greatest opportunity to make an impression,
including attracting attention to the vendor, the product, the terms of the sale,
and any other advantage the company offers

Account executives should help their clients understand all of the potential opportunities for
dual channel marketing, as well as also making them aware of the following:

• Time to sell products differently versus time when the need being filled is
essentially the same across the two channels.

• Situations in which marketing in one channel might damage marketing efforts in
the other.

• Methods which can be used to design messages which take advantage of the
firm’s strengths and brand equity and which keep the overall voice clear and
focused on the total company

Note the value of global brands.

Make sure internal marketing messages match with those sent to external groups. Be certain
employees and departments clearly recognize how the IMC program works, and how they
can help to achieve the greatest levels of success.

REVIEW QUESTIONS

3-1. What are the five steps of the consumer buying decision-making process?

Which two steps are the most important with regard to developing quality
integrated marketing communications?

The five steps in the consumer buying decision-making process are
1. Problem recognition
2. Information search
3. Evaluation of alternatives
4. Purchase decision
5. Postpurchase evaluation process

The two IMC steps are information search and evaluation of alternatives.

3-2. Describe the natures of an internal search and an external search in a

purchasing decision.

An internal search involves brands the consumer is willing to consider from past

experiences. An external search expands the list to include new alternatives.

3-3. Define attitude. What are the three main components of attitude, and how are

they related to purchasing decisions?

An attitude is a mental position taken toward a topic, person, or event that influences
a person’s feeling perceptions, learning processes, and subsequent behaviors.

Attitudes consist of three components: (1) affective, (2) cognitive, and (3) conative.
The affective component contains the feelings or emotions a person has about the
object, topic, or idea. The cognitive component refers to a person’s mental images,
understanding, and interpretations of the person, object, or issue. The conative
component is an individual’s intentions, actions, or behavior.

3-4. How do values differ from attitudes? Name some personal values related to
purchasing decisions.

Values are strongly held beliefs about various topics or concepts. Attitudes are
shaped, in part, by values.

Personal values related to purchasing decisions would be present in the purchasing of
books, cigarettes, alcohol, clothes, and are expressed in religion, patriotism, love of
family, and other personally held principles.

3-5. Explain what a cognitive map models.

Cognitive maps are simulations of the knowledge structures and memories embedded

in an individual’s brain. These structures contain a person’s assumptions, beliefs,
interpretation of facts, feelings, and attitudes about the larger world. These thoughts
processes interpret new information and determine a response to fresh information or
a novel situation.

3-6. What is an evoked set? Why are evoked sets, inept sets, and inert sets important

to the marketing department?

An evoked set consists of the brands he or she considers in a purchasing situation.

An evoked set may be reviewed during both the information search and
evaluation stages of the buying decision-making process.

Two additional brand sets will become part of the evaluation of purchase

alternatives: (1) the inept set and (2) the inert set. The inept set consists of the
brands that are part of a person’s memory that are not considered because they
elicit negative feelings. These negative sentiments are normally caused by a bad
experience with a vendor or particular brand. They may also originate from
negative comments made by a friend or by seeing an advertisement that the
potential customer did not like.

The inert set holds the brand the consumer is aware of but the individual has
neither negative nor positive feelings about the products. Inept sets and inert sets
are important because the only brands typically considered are those in the evoked
set. Inept and inert sets are not in the evoked set.

3-7. What are the key features of the multiattribute approach to evaluating

purchasing alternatives?

The key features of the multiattribute approach are the consumer’s beliefs about a

brand’s performance on various attributes (price, quality, etc.) and the importance of
each attribute to the individual consumer.

3-8. What is meant by affect referral? When is a person likely to rely on such a

cognitive approach to evaluating purchasing alternatives?

Affect referral is a purchasing decision model in which the consumer chooses the
brand for which he or she has the strongest liking or feelings. A person is likely to
rely on such an approach when the purchase is a low involvement item, which is
made frequently.

3-9. What trends in the consumer buying environment affect consumer purchasing
decisions?

The new trends include age complexity, gender complexity, active lifestyles, time
pressures, diverse lifestyles, communication revolution, cocooning, experience
pursuits, and an emphasis on health.

3-10. Name and describe the five roles played in a buying center.

Users are the members of the organization who actually use the product or service.

Buyers are the individuals who are given the formal responsibility of making the
purchase. In larger organizations, buyers are either purchasing agents or members of
the purchasing department.

Influencers are the people who shape purchasing decisions by providing the
information or criteria utilized in evaluating alternatives.

Deciders are the individuals who authorize decisions.

Gatekeepers are the people who control the flow of information to members of the
buying center. A gatekeeping function can be performed by several people rather
than one individual.

3-11. What organizational and individual factors affect members of the business
buying center?

Organizational influences include

At least seven factors affect each member of the business buying center: (1)
personality features, (2) roles and perceived roles, (3) motivational levels, (4)
levels of power, (5) attitudes toward risk, (6) levels of cognitive involvement, and
(7) personal objectives. Each impacts how the individual interacts with other
members of the center.

3-12. Describe the three main forms of business-to-business sales.

Straight rebuy, which occurs when the firm has previously chosen a vendor and
wishes to make a reorder. It tends to be a routine process.

Modified rebuy, where the company needs to consider and evaluate alternatives. A
modified rebuy situation can occur for four different reasons:

New task, where the company is buying a product or service for the first time and the
product involved is one with which they have no experience.

3-13. Name the steps in the business-to-business buying process.

3-14. Describe dual channel marketing and why it is important to a company’s
well-being.

Dual channel marketing is when firms sell virtually the same goods or services to
both consumers and businesses. It leads to selling products to every potential user of
the company’s offerings.

CRITICAL THINKING EXERCISES

3-15. Compulsive buying and/or shopping takes place when a person becomes

obsessed with making purchases, many of which are unnecessary or impractical.
For college students and other individuals with compulsive buying behaviors, a
primary influence is the family. Often one or both parents are compulsive
shoppers. Families that displayed other forms of dysfunctional behaviors—such
as alcoholism, bulimia, extreme nervousness, or depression—tend to produce
children who are more inclined to exhibit compulsive shopping behaviors. Why
do dysfunctional behaviors among parents produce compulsive shopping
behavior among children? Another component of compulsive buying behaviors
is self-esteem. Again, self-esteem is partly inherited, but it also develops in the
home environment. How would self-esteem be related to compulsive shopping
behaviors? What influences other than family might contribute to compulsive
shopping behaviors? If an individual has a tendency to be a compulsive shopper,
what can (or should) be done?

In student discussions, the answers should describe views on how dysfunctional
behaviors by parents affect children. First, what the children have seen may shape
how the kids process information (rationally versus emotionally) and consequently
make purchasing decisions. Second, attitudes and values shape the behaviors that

follow. Parents who have compulsive buying problems will role model the behavior
and probably not punish kids for the same activity. The same might apply to self-
esteem issues. Children who see parents exhibiting low self-esteem may assume the
same attitudes and behaviors as the parents.

3-16. Examine the consumer decision-making process illustrated in Figure 3.1.
Think of a recent high-involvement purchase you made that involved every step
in the process. Discuss each of the steps, especially the information search and
evaluation of alternatives.

Student responses will vary. This is a good in-class discussion question that can be
structured to different types of purchase.

Student answers will vary based on their personal response. Refer to the MyLab for

an opportunity to assign this question, and all starred MyLab questions, to a student
discussion board.

3-17. Think about the ways you purchase products and consider a recent purchase
that involved an external search. Discuss your ability to search, the need for
cognition, your personal level of shopping enthusiasm, and the perceived costs
versus the perceived benefits of the search. How much time did you spend in the
external search, and what was the outcome?

Student responses will vary by the product they describe. This is a good class
discussion question. Ask students to compare the shopping enthusiasm aspect.

3-18. Study the list of personal values presented in Figure 3.3. Identify the five that

are the most important to you. Rank then from first to last. Beside each value,
identify at least two products or services you have purchased to satisfy those
values.

Student answers will vary. In class, ask them to compare personal values.

Student answers will vary based on their personal response. Refer to the MyLab for
an opportunity to assign this question, and all starred MyLab questions, to a student
discussion board.

3-19. Review the three methods of evaluating alternatives. Briefly explain each

method. For each of the following product categories, which method of
evaluation would you use for your next purchase? Explain why.

a. Meal with your significant other at a dine-in restaurant
b. Auto service repair for your vehicle
c. Pair of jeans
d. Resort location for spring or winter break

Student responses will vary based on the type of purchase made.

Student answers will vary based on their personal response. Refer to the MyLab for
an opportunity to assign this question, and all starred MyLab questions, to a student
discussion board.

3-20. Pick two of the product categories below. Identify brands in your evoked
set, inept set, and inert set for that product category. Explain the rationale for
the placement of each of the brands.

a. Quick service restaurants
b. Retail clothing stores
c. Grocery stores
d. Computers

Student answers will depend on the category chosen and brands identified.

Student answers will vary based on their personal response. Refer to the MyLab for

an opportunity to assign this question, and all starred MyLab questions, to a student
discussion board.

3-21. Review the trends in the consumer buying environment presented in this
chapter. For each trend, discuss the level of impact it has on your purchase
behavior. Cite examples of goods or services that you have purchased as a result
of that trend.

Student responses will be based on the choices of goods and services.

3-22. A member of the buying center for a large shoe manufacturer tries to purchase

soles for shoes from an outside vendor vendors. Study the individual and
organizational factors that affect buying center members. Discuss the effect of
each factor on the roles of members in the shoe company’s buying center. How
does the factory foreman’s role differ from that of the purchasing agent? How
would these roles differ from the company president’s role?

The factors that affect buying center members are personality features, roles and
perceived roles, motivational levels, levels of power, attitudes toward risk, levels of
cognitive involvement, and personal objectives.

The personalities of the members in the buying center affect buying decisions.
Conflicts between members will make the process more difficult.

The roles and perceived roles in the buying center also affect the purchase. Those
who figure they are the major “players” will be more motivated and involved.

The motivational levels depend on which member is being contacted. Some will be
highly motivated; others will not.

The level of power should be understood by the seller, so the vendor knows which
person has influence with other members of the buying center group.

Buying center member attitudes toward risk mean individual members will probably
try to make sure the purchase is not too risky.

Levels of cognitive involvement reflect how much time and thought each member of
the buying center will give to a purchase decision. The vendor should be most
interested in members with greater cognitive involvement.

Personal objectives mean politics can affect buying decisions, so the vendor should
be aware of how the game is played, to whatever extent possible. The roles of the
factory foreman, purchasing agent, and company president are all very different. The
information available to each party is different, and the personal objectives of each
person vary. A company president probably knows more about the decision and is
looking out for the best interests of the overall organization. A factory foreman will
have greater first-hand involvement but may not be exposed to the marketing
messages sent by the vendor. A purchasing agent would look for value, delivery
time, and consensus among members of the buying group.

3-23. A purchasing agent for a clothing manufacturer is in the process of selecting

vendors to supply the materials to produce about 30 percent of its clothes. The
clothing manufacturer employs about 300 people. As the audit nears
completion, what factors are most important to the purchasing agent?

The factors that would be important to the purchasing agent would include
production capability, quality control mechanisms and processes; type and age of
equipment used; telecommunication and EDI capabilities; capacity to handle
fluctuations in orders; financial stability of the firm; and the number of competitors
that purchase from the firm. These factors would create an overall picture of the
stability of the firm, which the purchasing agent would use as the audit was
completed.

3-24. Identify four brands that you have used in a work environment that you also
have purchased in your personal life. Discuss the dual channel marketing
approach each of the brands use. Discuss the process that occurred in
purchasing the product for personal use and the influence using the brand in the
work environment had on the purchase, or the reverse if you used it personally
first.

Student responses will vary. Some will not have made purchases for work.

INTEGRATED LEARNING EXERCISES

3-25 Consumers and businesses conduct external searches when they lack

sufficient internal knowledge to make a wise decision. Assume you have
$150,000 to $200,000 to spend on a sailboat. Locate four websites that sell
sailboats. Select one in your price range. Discuss the external search process
you used to arrive at a decision. Relate this process to the concepts of
external search, consumer attitudes, and consumer values presented in this
chapter. Which method of evaluation did you use? Explain why.

Student answers will vary.

3-26. Almost everyone has an opinion about tattoos. Some attitudes are positive
whereas others are negative. Few are neutral. Go to www.tattoos.com and
examine the material there. Did this information modify your attitude
toward tattoos? What factors on the website influenced your attitude? Find
at least one additional website of a company that offers tattoos. Provide the
URL for the site and discuss the components of the website in terms of which
components of attitude it is trying to influence: cognitive, affective, or
conative.

Student answers will vary.

3-27. Go to the authors’ website at clowbaack.net/video/ads.html. Choose one of

the television ads. Which component of an attitude is the primary focus of the
ad? Justify your answer. Which consumer value is being emphasized? Justify
your answer. For the evaluation of alternatives, which method of evaluation
would be used by most consumers? Explain why. Which one of the trends in
the consumer buying environment identified in the text does the ad target?
Explain why. (Be sure to identify which ad you watched in your response.)

Student answers will vary.

3-28. Go to the authors’ website at clowbaack.net/video/ads.html. Watch the two

advertisements for NOLA, The Times-Picayune. For each ad identify the
component of attitude that you think is the primary focus and the personal
value being emphasized. Justify your choice. Who do you think is the target
audience for these two ads? Explain why. Which of the two ads did you like
the best? Why? Were the ads effective? Why or why not?

Student answers will vary.

3-29. Review the trends in the consumer buying environment. Examine each of the
following websites. Which trend or trends does each website seem to utilize
on its website? Use screen shots to justify your thoughts.

a. Chipotle Mexican Grill (http://chipotle.com)
b. Visit South Walton (www.visitsouthwalton.com)
c. Ralph Lauren (www.ralphlauren.com)
d. Scott + Cooner (http://scottcooner.com

Student answers will depend on the current website.

3-30. Examine the following websites. What type of information is provided?

Which component of attitude is the site designed to influence: cognitive,
affective, or conative? Explain why.

a. Kenneth Cole (http://www.kennethcole.com)
b. Starbucks (http://www.starbucks.com)
c. Cadillac (http://www.cadillac.com)
d. IKEA (http://www.ikea.com)

Answers will vary depending on what material is on the website when it is accessed
by students.

3-31. A member of the buying center has been asked to gather information about
possible shipping companies for international shipments. Visit the following
websites. What companies have the most appealing websites? Beyond online
materials, what additional information do they need to supply to the buying
center in order to win the contract?

a. ABC India Limited (www.abcindia.com)
b. SR International Logistics, Inc. (www.srinternational.com)
c. Allison Shipping International (www.allisonshipping.com)
d. Shipping International (www.shippinginternational.com)

Student answers will vary.

BLOG EXERCISES

Access the authors’ blog for this textbook at the URLs provided to complete these
exercises. Answer the questions that are posed on the blog.

3-32. Jeep: http://blogclowbaack.net/2014/05/07/jeep-chapter-3/
3-33. Olive Garden: http://blogclowbaack.net/2014/05/07/olive-garden-chapter-3/

3-34. Consumer behavior, buying process:

Consumer Behavior (Chapter 3)

These exercises provide you with an additional tool to engage your students.

Student Project: Creative Corner

This is an analysis for advertising spring break trip packages to college students.

Students should design an emotional ad, a rational ad, and an action-oriented ad for a trip to
Ft. Lauderdale, Florida, for a five-day trip.

CASES

Case 1 Choosing a Life Insurance Policy

3-35. Identify the need (or needs) that would begin the consumer buying decision

making process in this case.

The need to protect one’s family would likely begin the search.

3-36. How would the elements involved in an external search affect John and

Sandy as they explore their purchase options? Think in terms of:

a. ability to search
b. level of motivation
c. costs versus benefits

The ability to search would be high, the level of motivation would be high, and
the cost is time versus the benefit of feeling like they have provided protection for
the new baby would lead to a fairly extensive search.

3-37. Explain how John and Sandy could evaluate their options using the following

concepts and models:

a. attitudes and values
b. cognitive mapping
c. multiattribute

In terms of attitudes and values, protecting a child would rank high. They would

choose the company that offered the best protection.

In the cognitive mapping area, they would explore current linkages in terms of

companies they know about and how well those companies served the needs of

their families and/or friends. New linkages would come from marketing
messages.

A multiattribute approach would likely look at costs of policies, benefits of those

policies, and the reputations of companies offering policies.

3-38. What types of marketing messages should each of the three life insurance

companies design to reach consumers such as John and Sandy, for either the
information search, evaluation of alternatives, or both stages of the buying
decision-making process?

Messages should probably emphasize the company’s name, so they become part
of the potential choices. Then, they should focus on explaining why a specific
company is better. When it comes to something like life insurance, often
messages note strength, security, and peace of mind.

Case 2 The Choice

3-39. Discuss the reasoning behind each person’s choice based on the information
provided and the individual factors outlined in this chapter.

Martin Garza made his choice for political reasons. He believed it would help
him achieve promotion.

Suzette Simon was the product user. She wanted better quality.

Paul Johnson had motives related to saving the company money combined with the
political motive of disliking Martin Garza.

Rose Knotts saw her position as having low power and voted to please her
supervisor.

3-40. Identify the factors that favor each vendor and the factors that are the vendor’s

weaknesses.

Company 1 – average to low quality but was the previous choice (last purchase),
making it easier to rebuy.

Company 2 – advantage service; disadvantage price.

Company 3 – advantage quick service; disadvantage being unknown and new to the
market.

Company 4 – advantages of price and an insider helping out; disadvantage quality.

3-41. How should Jason make the final choice, given there is such a great divergence
in opinion?

Jason should balance the interests and opinions of buying center members he trusts
and also consider the advantages and disadvantages listed above.

3-42. What should Jason say to the members of the buying center whose favorite
companies are not chosen?

He should thank them for their time and effort and tell them that their input was
given careful consideration.

MyMarketingLab
Go to mymktlab.com for the answers to the following Assisted-graded writing
questions:

3-43. Describe each of the trends in the consumer behavior environment. Discuss

the impact that each trend has on clothing purchases, especially current
fashions.

3-44. Identify and define the factors that affect the amount of time consumers

spend in conducting an external search. Suppose you wanted to purchase a
boat (sailboat, powerboat, or fishing boat). Discuss each of the factors that
would affect your external search process in the purchase of the boat.
Explain why.

Bonus Case

CLEARING THE AIR

Most people want to live in a clean environment. Marketing cleaning products involves

tactics ranging from rationality and logic to emotions and instincts. Some companies use

the simplest possible terms, as basic as calling bacteria “germs.” Advertisers use cartoons

and simple diagrams to show how the product kills bad germs and makes things

“sparkle.” At the other extreme are the more complex and scientific explanations

regarding a product’s ability to clean things up.

In this context, the market for air purifiers has grown and developed in the past

decade. Smaller items, such as air freshener sprays and plug-ins made by brands such as

Glade, have been available for many years. Now, newer technologies, such as HEPA

hydro-allergenic filtration, are available.

The Sharper Image has been a leader in the marketing of new air cleaning

technologies. The company’s basic product and brand, the Ionic Breeze, has been sold

through retail stores and websites and via infomercials and inbound telemarketing for

many years.

One primary feature of all the Ionic Breeze products is silent operation. The Silent

Electronic Propulsion technology made the original product the number-one air-cleaner

brand in America. Through this silent air circulation technology, the company promises

effective removal of airborne contaminants, reduction of common household odors, no

filters to replace, low energy costs, an attractive design, ease of operation, and low

maintenance.

Variations on the base model now include advancements such as the Germicidal

version; the QUADRA; a smaller, plug-in bathroom version; and the new MIDI, which is

smaller than earlier products. Other features associated with the Ionic Breeze are its

OzoneGuard with PremAir catalyst, developed by BASF Catalysts LLC, which converts

the by-product ozone to oxygen.

Not surprisingly, competition has emerged. One of the new major players is Oreck, a

company that gained fame and brand strength through its line of vacuums, which are

lightweight but powerful carpet cleaners. A logical brand extension would be into air

filtration.

Oreck promotes products that kill viruses, bacteria, mold, and fungi. One major

difference is that the Oreck model does move the air. In advertisements and promotional

materials, the air clearers are demonstrated as being superior because of this feature.

Product materials strongly emphasize the health benefits of cleaner air. Oreck air cleaners

are also featured in infomercials, on websites, and through standard television

advertising.

Both Oreck and Sharper Image note that the air inside a house often is much more

polluted than the air outside. Consumers are warned that asthma, allergies, and

respiratory illnesses are on the rise. Air cleaners are offered to help.

Now, many lower priced air cleaners are also available through retailers such as

Walmart and Target. Consequently, consumers have a vast array of potential prices,

product features, and promotional claims to consider when choosing an air cleaning

product. The future of the air cleaning business appears to be either bright or cloudy,

depending on one’s perspective, and consumers will undoubtedly see the number of

options for methods to clear the air continue to rise.

Sources: Case based on information available at www.oreck.com and

www.sharperimage.com.

(1) How would a consumer’s level of involvement, need for cognition, and level of

shopping enthusiasm affect the purchase of an air filtration product?

A consumer with a low level of involvement would not spend as much time
searching for alternatives. One with a high level of involvement would seek out
more options and want to know more about them.

A consumer with a low need for cognition would not care about the details regarding
how each system works.

A person with a higher level of shopping enthusiasm would be more inclined to go
to a store such as Sharper Image would want demonstrations and other
information.

(2) Explain how cognitive mapping could be used to demonstrate a consumer’s

reaction to either the Ionic Breeze or the Oreck Air Cleaner.

Each cleaner might have its own set of linkages. For example, the Oreck model may
conjure up memories of commercials for Oreck vacuum cleaners and the CEO,
David Oreck. Both would have various levels of cognition. The name Ionic might
create images of something more high-tech or modern. Oreck may seem more old-
fashioned, but the advertisements noting how the air moves through the system may
attach to other concepts, such as fans and other types of filters, including air filters
on air conditioners and automobiles.

(3) Which model best explains the evaluation of alternatives when it comes to air
filtration products, the evoked set model, the multiattribute approach, or affect
referral?

Student responses will vary. It seems unlikely that affect referral would apply,
except in the case of a buyer who already owns an Oreck product and therefore
sticks with the same brand. In terms of an evoked set, there are limited choices in the
first place. Those customers who take the time to really study the advantages and
disadvantages of each model would be the ones using the multiattribute approach.
They would also be the ones with great levels of involvement and a greater need for
cognition.

(4) Should air cleaner companies focus on fear, health, or other emotions to sell
products? Explain.

Student answers will vary. A case can be made for fear, health, protecting ones
loved-ones and possibly other emotions.

Integrated Advertising, Promotion, and Marketing Communications

Seventh Edition

Chapter 1

Integrated Marketing Communications

Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
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Learning Objectives
1.1 How does communication take place?
1.2 What is an integrated marketing communications program?
1.3 What new trends are affecting marketing communications?
1.4 What are the components of an integrated marketing communications program?
1.5 What does the term GIMC mean?

Chapter Overview
Highly competitive global marketplace
Wide variety of media available
Clear communications needed
Customers bombarded with communications
Integrated advertising and communications

Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
This chapter provides an overview of integrated marketing communications. It is a highly competitive and global marketplace, and firms are looking for ways to stand out. Brands are looking for means to become a part of customers’ evoked sets. Companies have a wide variety of media from which to choose, both traditional and nontraditional. Because customers are bombarded with so many marketing messages, it is vital for a company to stand out with a clear, consistent, and integrated message.
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Miracle Whip
Love or Hate campaign
mcgarrybowen advertising agency
“We’re not for everyone”
Primetime advertising
Social media campaign
Consumer contest
Risky, controversial campaign

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In 2011, Miracle Whip was promoted in a surprising, risky, and controversial way. The essence of the campaign was you either love or hate the product. Both sides were shown in the ad. Associated with the broadcast and print ads was a social media campaign that centered on a contest asking consumers to upload their videos taking one side or the other, and how it affected their relationship with their spouse or significant other. The campaign drew criticism, but also gained considerable attention.
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Figure 1.1 Communication Process

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The communication process consists of five stages, or components. The sender is the individual or company that wants to send a marketing message to consumers or to other businesses. It can be an advertisement, a brochure, or even a salesperson. Encoding is the process of taking the message and putting it into an ad, brochure, or sales presentation. The transmission device is the television, the paper on which the brochure is printed, or the salesperson at the retail store. The receiver is the consumer or business buyer. Decoding is the process of interpreting the marketing message. Effective communication has taken place if the message that is decoded is the same as was encoded. But, often noise occurs and distorts the message. Noise can be anything and can occur at any stage. Senders can obtain feedback from receivers and use the information to start the process again.
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Chick-fil-A Social Media
Integrates online with offline
Facebook – 500 profile mentions
Official Chick-fil-A Facebook page
Fans helps administer the page
Allows fans to interact
Announces specials, provides coupons
Promotions on Twitter
“Eat Mor Chikin” offline advertising

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Social media has become an important marketing medium for businesses. A brand that has successfully used social media is Chick-fil-A. The online message has been carefully integrated with the offline marketing thrust of the brand. Fans now help to administer the social media page, which has grown rapidly. The official Facebook page for Chick-fil-A allows the company to interact with fans. It provides a venue for posting announcements about store openings, special deals, and coupons. Promotions are also now offered on Twitter.
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Figure 1.2 Examples of Communication Noise
Talking on the phone during a commercial on television
Driving while listening to the radio
Looking at a sexy model in a magazine ad and ignoring the message and brand
Scanning a newspaper for articles to read.
Talking to a passenger as the car passes billboards
Scrolling past Internet ads without looking at them
Being annoyed by ads on a social media site
Ignoring tweets on Twitter because they are irrelevant
Being offended by the message on a flyer for a local business

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These are examples of noise that can impact effective communication and prevent the encoded message from being heard at all or lead to the message being decoded differently than was intended.
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Integrated Marketing Communications
Integrated Marketing Communications is the coordination and integration of all marketing communication tools, avenues, and sources within a company into a seamless program which maximizes the impact on consumers and other end-users at a minimal cost. The IMC includes all business-to-business, channel, customer, external communications, and internal communications.

Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Definition of integrated marketing communications. Key components are:
Coordination and integration of all marketing communication tools and venues
Seamless marketing program designed to maximize impact at lower costs
Includes all b-to-b, channel, customer, external, and internal communications
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Figure 1.3 The Components of Promotion

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The traditional marketing mix consists of product, price, promotion, and distribution. Traditionally, the promotion component consisted of advertising, sales promotions, and personal selling. Today, it has expanded to include database marketing, direct response marketing, sponsorship marketing, digital marketing, social media, alternative marketing, and public relations. The venues for reaching consumers have increased beyond advertising.
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Figure 1.4 Steps of a Marketing Plan
Current situational analysis
SWOT analysis
Marketing objectives
Target market
Marketing strategies
Marketing tactics
Implementation
Evaluation of performance

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In understanding integrated marketing communications, it helps to review the steps in a marketing plan. The current situational analysis and SWOT set the stage for setting marketing objectives and choosing the target market. Once these are set, the marketing person can develop strategies and tactics. IMC will be part of the overall marketing strategy to reach consumers. It will also be part of the tactics, which are the plans for achieving the objectives and carrying out the strategies. Implementation and evaluation conclude the marketing planning process.
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Figure 1.5 Trends Affecting Marketing Communications
Emphasis on accountability & measurable results
Explosion of the digital arena
Integration of media platforms
Shift in channel power
Increase in global competition
Increase in brand parity
Emphasis on customer engagement

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With global competition has come a greater scrutiny of advertising and marketing budgets. This has led to a greater emphasis on accountability of expenditures and measurable results. The drive for measurable results is one of the factors that has led to the explosion of the digital arena, which includes social media. Measuring the impact of digital expenditures is easier than for traditional advertising. Because consumers now access information from smartphones, tablets, and other media platforms, companies must integrate their marketing communications across all platforms. With greater access to information, consumers now have considerably more channel power. With the rise of the Internet, competition now comes from the entire world. This global competition has increased the level of brand parity now seen across most product categories. To decrease brand parity and build some brand equity, brands are putting greater emphasis on customer engagement.
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Accountability and Measurable Results
Economic pressures
Want results from marketing budgets
Effort led by CEOs, CFOs, and CMOs
Advertising agencies expected to deliver results
Emerging social media changes communication
Emerging alternative methods and media
Less reliance on mass TV ads

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Economic pressure, especially recent downturns in the economy, has put pressure on ad agencies and marketing officers to be accountable for their expenditures. CEOs, CFOs, and CMOs want measureable results. Show us the proof that the $50 million ad campaign is working and will translate into sales. In the past, once an ad agency was hired, they stayed with a client for a number of years because they knew the brand. Now, companies want results. If not, then a new agency will be chosen. With the rise in popularity of social media, there is less reliance on mass TV advertising. Agencies continue to explore alternative ways of reaching consumers where it is less cluttered than mass media.
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Explosion of Digital Media
Emergence of
interactive web sites, blogs, and social networks
smartphones, tablets
Companies shifting expenditures from traditional to digital media
Social media allows interaction

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Alternative media has become the new buzz phrase in advertising, especially online. The Internet provides an interactivity with consumers. Websites, blogs, and social networks all provide two-way communications. Smartphones are replacing cell phones, so consumers now have the Internet with them at all times, increasing the ways and means of reaching them. As a result, companies are shifting dollars from traditional media to digital media.
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Integration of Media Platforms
Consumers integrate platforms
5 hours 16 minutes  non-television screens
4 hours 31 minutes  television
Ways consumers integrate media formats
Content grazing
Investigative spider-webbing
Quantum journey
Social spider-webbing

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Consumers now spend more time with non-television screens than they do watching TV. Research by Ipsos OTX identified 4 ways that consumers interact with multiple media formats. Content grazing involves looking at two or more screens simultaneously to access different content. Investigative spider-webbing occurs when consumers pursue specific content across multiple platforms. Quantum journey focuses on completing a specific task across multiple platforms. Social spider-webbing occurs when consumers share content across multiple devices.
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Figure 1.6 Pathways Consumers Use to Interact Across Media Devices
Source: Based on Mark Walsh, “Microsoft Highlights Usage Across Device Pathways,” Online Media Daily, March 14, 2013, www.mediapost.com/publications/article/195786

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In the survey by Ipsos OTX, consumers were asked how they integrate across multiple platforms. Content grazing is the most frequently method used, at 68%. Social spider-webbing is the least used, 39%. Respondents were able to select more than one method of interacting, thus producing percentages that add to more than 100%.
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Changes in Channel Power
Retailers
Control channel
Control shelf space
Have purchase data
Determine products and brands on shelves
Consumers
Internet shifts power to consumers
Multiple methods of making purchases

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Channel power has changed and is continuing to change. For the first 60 or so years in the 1900s, channel power resided with the manufacturers, such as Procter & Gamble. It then shifted to retailers, especially large chain retailers like Wal-Mart. Retailers controlled shelf space, had purchase data, and determined what products and brands went on the shelves. Consumers had to buy whatever brands a retailer stocked. Power is now beginning to shift to consumers, primarily because consumers do not have to purchase from the local retail store. They have options. Retailers who realize this are providing multiple ways for consumers to purchase and receive products.
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Increases in Global Competition
Information technology and communication has changed the marketplace.
Products can be purchased from multiple locations.
Customers want both low prices and high quality.
Manufacturers and retailers must work together.

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Advances in communication technology have led to the rise of global competition. Every business competes in some way with global firms, either directly or indirectly, either for customers or for supplies. Products can be purchased from multiple locations. As a result, the level of competition has increased, and the prices of products have fallen. The challenge businesses now face is that consumers want it all. They want the lower prices created by global competition, but they also want quality. To provide this to consumers, manufacturers and retailers must work together. They must become partners with mutual goals that benefit both parties.
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Increase in Brand Parity
Brands viewed as being equivalent
Consumers select from a group of brands
Quality and characteristics less important
Price more important
Decline in brand loyalty

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With brand parity, consumers see the brands as about equal in quality and attributes. Rather than having one brand that is viewed as being superior, consumers often have a group of brands they feel are equal and would meet their needs. As a result, in brand parity situations, quality and characteristics become less important since these are viewed as being equal. That makes price often the determining factor. The rise in brand parity has led to a decline in brand loyalty.
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Emphasis on Customer Engagement
Marketers seek to engage customers
Contact points important
Digital media now part of IMC
Two-way communication
Strive to develop emotional commitment

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With the increase in brand parity and the decline in brand loyalty, companies have placed greater emphasis on customer engagement. Contact points between customers and the product are examined in an effort to improve communication and the relationship. Digital media is now a critical component of IMC plans because it provides two-way communication. It is no longer sufficient to talk to customers, you must develop a dialogue with customers. The goal – a deeper emotional commitment on the part of consumers towards the brand.
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Understanding Customer Engagement Also Applies to Nonprofits

Figure 1.7 Composite Scores of Top Ten Restaurants on Advertising Perceptions
Source: Based on Colleen Rothman and Gina Gapp, “Perceptions of Restaurant Advertising,” Technomic white paper, Issue 3, September 2013.

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Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Technomic Consumer Brand Metric monitors 120 restaurants across 60 attributes. For this survey, 78,743 people responded to three metrics about restaurant advertising – has memorable advertising, has advertising I can relate to, and has advertising that makes me hungry. The bar chart shows the results of the survey. Subway had the highest composite score (73.3) followed by Olive Garden (72.9).
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Figure 1.8 Overview of IMC Text

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This pyramid represents the structure of the text. At the bottom level are issues such as brand management, buyer behaviors, and the IMC planning process. Section 2 deals with advertising issues, section 3 with digital marketing, social media, and alternative channels, and level 4 with database and direct response marketing, sales promotions, and public relations. The book concludes with discussions on regulations, ethics, and an evaluation of the IMC effort.
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International Implications
Goal – to coordinate marketing efforts
Greater challenge due to national and cultural differences
Standardization versus Adaptation
“Think globally, but act locally”

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Because of the increase in global competition, firms must coordinate marketing efforts across multiple countries. Because of cultural differences and language differences, it is a greater challenge. Firms can use a standardized approach which means the same approach and message is used in every global market. This works only for global brands that are worldwide and well known. An alternative is adaptation, which means firms adapt their marketing communications to each country, region, and culture. The idea is to “think globally, but act locally.”
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Integrated Campaigns in Action
Actual campaigns created by
Agencies
Internal marketing departments of brands
Highlights application of theories
Five Campaigns
Section 1: Progressive Bank (Chapter 4)
Section 2: Snoring Center (Chapter 7)
Section 3: Interstate Batteries (Chapter 10)
Section 4: Wayport Austintatious (Chapter 13)
Section 5: Centric Credit Union (Chapter 15)

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The Integrated Campaigns in Action feature includes actual campaigns created by either an advertising agency or the internal marketing department of brands. The campaigns are in the last chapter of each section of the book.
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Blog Exercises
Chick-fil-A

Subway

Integrated Marketing

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The blog exercises for Chapter 1 include Chick-fil-A, Subway, and videos about integrated marketing. Links are embedded in the text for each.
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Integrated Advertising, Promotion, and Marketing Communications

Seventh Edition

Chapter 2

Brand Management

Learning Objectives (1 of 2)
2.1 How does a brand image affect consumers, other businesses, and the company itself?
2.2 What elements are involved in identifying, creating, rejuvenating, or changing a brand’s image?
2.3 What are the different types of brand names?
2.4 What are the characteristics of effective logos?
2.5 What different kinds of brands can firms offer?

Learning Objectives (2 of 2)
2.6 How are brands developed, built, and sustained in order to build brand equity and fend off perceptions of brand parity?
2.7 What current trends affect private brands?
2.8 How are packages and labels used to support an IMC program, both domestically and in foreign settings?
2.9 How are brands managed in international markets?

Applebee’s
2008 recession changed dining out
DineEquity purchased Applebee’s
IHOP CEO – Julia A. Stewart
“Minnow swallows the whale”
Act of retribution
Marketing emphasis
Product quality, price, promotions
Quality employment environment
Enhance dining experience
“Girl’s Night Out”
Advertising agency – Crispin Porter

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The recession (2008) changed the dining habits of Americans as people switched to cheaper dining-out alternatives. DineEquity, which owns IHOP, purchased Applebee’s. CEO Julia A. Stewart says it was case of a “minnow swallowing a whale” since IHOP had 1400 locations and Applebee’s had 2000. Concern was that it was retribution by Stewart for not getting the Applebee’s CEO position. Emphasis was placed on product quality, pricing, promotions, the dining experience, and a quality employment environment. In 2012, a change was made to the Crispin Porter advertising agency. Applebee’s is an excellent example of brand building and rejuvenation with a stagnant company.
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Chapter Overview
Managing a brand image
Issues associated with developing and promoting brand names and logos
Brand equity versus brand parity
Importance of packaging and labels

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The chapter begins with a discussion of brand image – the tangible and intangible elements that make up a brand’s image. Brand image is more than the goods and services the company sells. The brand image involves everything the brand does and every touchpoint between customers and the firm. Many companies have multiple brands that must be managed. It involves understanding the brand image and deciding if it is the image that is desired. If not, then modifications must be made. Issues with developing and promoting brand names and logos are presented. Lastly, the chapter presents information about packaging and labeling. In addition to protecting products, packaging is a final marketing message to consumers to make a purchase decision.
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Brand Image Advertisement by Kraft Foods

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Part of an integrated marketing campaign is brand image advertising. This ad for Kraft Foods is designed to reinforce the Kraft brand.
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Figure 2.1 Components of a Brand Image
Tangible Elements
Goods or services sold
Retail outlets where the product is sold
Advertising
Marketing communications
Name and logo
Packaging and labels
Employees
Intangible Elements
Corporate personnel
Ideals
Beliefs
Conduct
Environmental policies
Corporate culture
Country location
Media reports

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Brand image is made up of everything a company does, has, and is. It includes tangible and intangible elements. Tangible elements can be observed. In addition to the goods and services that are sold, tangible elements include the retail outlets where the products are sold and the factories where the products are made. Advertising, promotions, and other forms of communications all reflect the image of a brand. Certainly the brand name and logo convey a specific message. Packaging protects products, and labels provide information about the product inside. The last tangible element are the employees. What they say about a company influences consumers. On the intangible side are policies of the company in dealing with employees and other publics. Ideas and beliefs espoused by corporate personnel become part of the image. Even the culture and location of the company are important. Lastly, media reports can enhance or harm a company’s image depending on what is communicated.
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Role of Brand Image Consumer Perspective
Provides positive assurance
Unfamiliar settings
Little or no previous experience
Reduces search time
Provides psychological reinforcement
Provides social acceptance

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From a consumer’s perspective, brand image serves several important functions. It provides positive assurance about a brand and what can be expected. It is especially helpful in unfamiliar settings, such as on a vacation or a trip, and when the consumer has very little previous experience. A well-known brand or company becomes a safer purchase choice. In shopping, a strong brand image can save search time. Consumers do not have to evaluate several brands. They can just choose the one they feel is the best, based on brand image. A strong brand name provides psychological reinforcement to consumers that they made a wise purchase decision, and it also provides social acceptance with other people.
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Figure 2.3 Top 10 Corporate Global Brands
Rank Company Brand Value (Billions) Country
1 Apple $98.3 United States
2 Google $93.3 United States
3 Coca-Cola $79.2 United States
4 IBM $78.8 United States
5 Microsoft $59.5 United States
6 General Electric $46.9 United States
7 McDonald’s $41.9 United States
8 Samsung $39.6 South Korea
9 Intel $37.3 United States
10 Toyota $35.3 Japan

Source: Based on “2013 Ranking of Top 100 Brands,” Interbrand, interbrand.com, accessed September 30, 2013.

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This chart identifies the top 10 corporate global brands and the brand value for each. Each year Intrabrand publishes a list of the top 100 brands, which can be found at the Interbrand website.
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Role of Brand Image Company Perspective
Extension of feelings to new products
Ability to charge more
Consumer loyalty
More frequent purchases
Positive word-of-mouth
Greater channel power
Attracts higher quality employees
More favorable ratings

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Having a strong brand image also benefits a company. It allows for the extension of new products. In most cases, the feelings and image that consumers have about the brand will transfer to the new product. Because of the strong image, a company can price its products higher. Customers are willing to pay the higher price and become more loyal as well. They also tend to purchase more frequently and often generate positive word-of-mouth communications. In terms of the distribution channel, a strong brand name allows a company to have greater channel power. Because consumers purchase the company’s products, retailers and other channel members will want to stock it. Even employees and potential employees are attracted to good companies. They want to be associated with the firm. Lastly, it provides more favorable ratings with investors.
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Identifying the Desired Image
Evaluate current image
Ask customers
Ask non-customers
Can be strategic advantage

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The first step in managing a brand image is to identify the desired image. This begins with evaluating the current image by asking customers what they think. It is also important to ask non-customers. They often present a different view, one that reflects why they did not make a purchase. Having a strong brand image can be a strategic advantage for a company. Interstate Batteries has a specific image, one that is desirable to most consumers.
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Creating the Right Image
Sends clear message
Portrays what the firm sells
Business-to-business may be challenging

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Creating the right image is important. It sends a clear message about what the firm sells and what it stands for. With the business-to-business sector, creating the right image may be more challenging. Such was the case with Scott Equipment, which sells new and used construction, agricultural, and industrial equipment. Creating the right brand image was important to the company’s success.
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Rejuvenating an Image
Sells new products
Attracts new customers
Retains current customers
Key – Remain consistent with old and new
Takes time and effort

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In some cases an image has become stale or not quite in sync with what the company wants. It is then time to rejuvenate the image. The company wants to keep what is good about the past but build new concepts for the future or modify the view slightly to be more relevant to consumers. Rejuvenating a brand image can produce a number of positive results, such as increasing sales, attracting new customers, and retaining current customers. The key to rejuvenating an image successfully is to remain consistent with the old image while adding new elements. It takes time and effort and will not happen overnight.
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Figure 2.5 Keys to Successful Image Rejuvenation
Help former customers rediscover the brand
Offer timeless consumer value
Stay true to original, but contemporize
Build a community

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Successful rejuvenation of a brand requires 4 critical ingredients – helping former customers to rediscover the brand, offering timeless consumer value, staying true to the original, yet contemporizing the brand, and building a community of loyal consumers. Rejuvenation requires retaining current customers, winning back former customers, and attracting new customers. The opening vignette about Applebee’s is a good illustration of rejuvenation.
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Changing an Image
Extremely difficult
Necessary when target market declines or product no longer matches industry trends
Requires more than advertising
Begins internally – then moves outward

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The most difficult challenge is changing an image. At times, it may not even be possible. It becomes necessary to change an image when the target market declines resulting in lower sales or when the product no longer matches industry trends. Changing an image requires considerably more advertising. It has to begin internally, and then move outward. Employees must see the change, believe the change has occurred, and then convey that change to every contact the company makes. Changing an image is a slow, tedious process.
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Corporate Names
Overt names
Implied names
Conceptual names
Iconoclastic names

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Choosing a corporate name is important. Companies will spend thousands and even millions on choosing just the right name. Corporate names can be divided into 4 categories.
Overt names reveal what a company does, such as American Airlines.
Implied names contain words or word parts that convey what a company does, such as FedEx.
Conceptual names capture the essence of what a company offers, such as Twitter.
Iconoclastic names represent something unique, different, and memorable. The name does not reflect or imply what the company does. Nike would be an example.
In the ad shown, the Snoring Center name would be an example of an overt name. It is evident the company does something with snoring.
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Figure 2.7 Origins of Some Unique Corporate Names (1 of 2)
Google – name started as a joke about the way search engines search for information. Word “googol” is one followed by 100 zeros.
Lego – combination of Danish phrase “leg godt” which means “play well” and Latin word “lego” which means “I put together.”
Reebok – alternative spelling of “rhebok” which is an African antelope

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Logos and corporate names should meet four tests. First, they should be easily recognizable. Second, they should be names and symbols that are familiar to people. Third, the meaning should be consensual, i.e. everyone who sees the logo or hears the name has similar thoughts and ideas. This process of having shared meanings across consumers is called stimulus codeability. This helps especially in global markets, but is difficult to achieve across national boundaries. Fourth, the logo and name should evoke positive feelings.
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Figure 2.7 Origins of Some Unique Corporate Names (2 of 2)
Skype – original name was “sky-peer-to-peer,” which was changed to “skyper” then to “skype.”
Verizon – combination of Lain word “veritas” which means “truth” and “horizon”
Volkswagen – created by Adolph Hitler as a car for the masses that could transport 2 adults and 3 children at speeds up to 62 mph. Name means “people’s car.”
Yahoo – word from Jonathan Swift’s book Gulliver’s Travels, which represented a repulsive, filthy creature that resembled a Neanderthal man. Yahoo founders, Jerry Yang and David Filo considered themselves yahoos.

Figure 2.8 Tests of Quality Logos and Brand Names
Easily recognizable
Familiar
Consensual meaning
Stimulus codeability
Evokes positive feelings

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Logos and brand names should meet four tests. First, they should be easily recognizable. Second, they should be names and symbols that are familiar to people. Third, the meaning should be consensual, i.e. everyone who sees the logo or hears the name has similar thoughts and ideas. This process of having shared meanings across consumers is called stimulus codeability. This helps especially in global markets, but is difficult to achieve across national boundaries. Fourth, the logo and name should evoke positive feelings.
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Figure 2.9 Some of the Oldest Logos
Company/Brand Year Company Founded Year Logo First Used
John Deere 1837 1876
Coca-Cola 1886 1886
Johnson & Johnson 1886 1886
Union Pacific Railroad 1862 1888
Prudential Life Insurance 1875 1896
Campbell’s Soup 1869 1898
General Electric 1892 1900
Goodyear 1898 1901
Sherwin-Williams 1866 1905
DuPont 1802 1907

Source: Based on Samuel Weigley, Alexander Hess, and Paul Ausick, “The Oldest Company Logos in America,” 246wallst.com, June 18, 2013.

Brand Logos
Aids in recall of specific brands
Aids in recall of advertisements
Reduces shopping effort
Reduces search time and evaluation of alternatives

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Corporate logos are important because often people see the logo and instantly know the company. In a symbolic way, it conveys a message. This logo for PolyProcessing looks like some type of process as the two lines curve and overlap each other. Corporate logos provide several benefits. They aid in recalling specific brands and advertisements. People may not notice the brand name, but the logo is a picture and tends to be remembered better. In shopping, customers often look for familiar logos and colors of packages and products, which saves time and energy. They don’t need to look at alternatives.
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Figure 2.10 Tips on Creating or Changing Logos
The logo is a reflection of the brand.
Creating logos requires knowledge and expertise.
Use professional designers
Make the logo simple
Make the logo media transferrable

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Creating or changing logos takes careful consideration. It requires knowledge and expertise in logo design and an understanding that the logo is a reflection of the brand. It is best to use professional designers. The temptation is for a business owner to do it himself using a graphics design package. Logos should be simple. They also should be transferrable across multiple mediums.
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What Colors Should You Use in Your Logo? (1 of 2)
Black –seriousness, distinctiveness, boldness, power,
sophistication, and tradition
Blue – authority, dignity, security, faithfulness, heritage, corporate stability, and trust
Brown/gold – history, utility, earthiness, richness, tradition, and conservative
Gray/silver – somberness, authority, practicality, corporate mentality, and trust
Green – tranquility, health, freshness, stability, and appetite
Orange – fun, cheerfulness, warmth, exuberance, health, and youth

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(Bonus slide, not in textbook) Colors are very symbolic and convey various meanings. This slide provides information on various colors and what they tend to mean in American culture. The meaning varies widely across other cultures and in other countries. While consumers may not consciously think about the color in a logo and what it means, there may be a subconscious attachment between the color and these meanings.
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What Colors Should You Use in Your Logo? (2 of 2)
Pink – femininity, innocence, softness, health, and youth
Purple – sophistication, spirituality, wealth, royalty, youth, and mystery
Red – aggressiveness, passion, strength, vitality, fear, speed, and appetite
White/silver – purity, truthfulness, faith, contemporary, refined, and wealth
Yellow – youth, positive feelings, sunshine, cowardice, refinement, caution, and appetite
Source: Adapted from “Jared McCarthy, “Logos: What Makes Them Work (Part 1 of 2),” (marketingprofs.com), February 22, 2005.

Types of Brands
Family brands
Multiple products under one brand
Transfer associations
Brand extension
New good or service
Flanker brand
New brand within current category

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Brands can be placed into 3 major categories. Family brands are a group of related products sold under one name. The primary advantage of using a family brand is transferring associations to new products. Brand extensions involve suing an established brand name on products or services not related to the core brand. An example would be Black & Decker putting its brand name on appliances. Flanker brands involve the development of a new brand sold in the same category as another product. Proctor & Gamble offers a number of brands within a category, such as laundry detergent or body wash. Hallmark sells a cheaper version of greeting cards, Shoebox Greetings. The goal of flanker brands is to capture a bigger market share without cannibalizing current brands.
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Figure 2.12 Brands Sold by Procter & Gamble

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This slide presents examples of flanker brands sold by Procter & Gamble in three different product categories. For instance, in the dish washing category, P & G offers consumers four different brands. P & G believes each brand attracts a different type of consumer, and by offering four brands P & G captures a larger market share than if the firm sold only one brand.
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Figure 2.13 Forms of Co-Branding (Alliance Branding)

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Co-branding or alliance branding is the offering of two or more brands in a single marketing offer. There are three types of co-branding options. Ingredient branding is the placement of one brand within another brand, such as Intel processors in various brands of computers. Cooperative branding is the joint venture of two or more brands into a new product or service, such as VISA card offered by JP Morgan Chase with American Airlines. Complementary branding is the marketing of two brands together for co-consumption, such as Oreo milkshakes at Dairy Queen.
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Developing Strong Brands
Begins with understanding why consumers buy a brand.
Where does your brand stand now?
What are your objectives?
What are you doing in terms of building your brand and business?
What are your brand’s strengths? Weaknesses?
Which opportunities should be pursued first?
Where are the pitfalls?

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Developing strong brands begins by understanding why consumers buy a brand. On this slide are typical questions that can be asked of a client to measure the current position of a brand and to help an agency understand the current position of a brand.
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Figure 2.14 Building Powerful Brands
Invest in the brand
Create awareness
Offer authenticity or uniqueness
Build trust
Deliver an experience
Offer value
Utilize social media
Utilize mobile phones
Act responsibly

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Building powerful brands requires a marketing commitment. Companies must be willing to invest money in the brand, which starts with creating awareness. However, awareness alone will not build a strong brand. Strong brands offer some type of authenticity or uniqueness. They deliver value and a positive consumer experience that result in consumer (or b-to-b) trust. Today’s brands must be savvy about using social media and incorporating mobile phones (smart phones). Consumers also want companies to act socially responsible.
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Building Powerful Brands
Skyjacker has built a powerful brand by providing customers with a good experience and delivering value.

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Skyjacker dominates the vehicle suspension market and has built a powerful brand by delivering value and a positive customer experience. Click on the link to visit Skyjacker’s website.
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Brand Loyalty
Ultimate objective
Only brand that customers purchase
Drivers of brand loyalty
Emotion
Value
Consumer experience

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Brand loyalty is the ultimate goal of building powerful brands. With brand loyalty, consumers purchase only that specific brand regardless of the effort necessary. They are not willing to substitute another brand. Drivers of brand loyalty are an emotional connection and value. Brand loyalty goes beyond functional attributes.
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Figure 2.15 Top Brands (CLEI)
Category Top Brand CLEI Emotional Engagement
Athletic Footwear Sketchers 86%
Bank JP Morgan Chase 79%
Car Insurance State Farm 82%
Casual Dining Applebee’s 82%
Cosmetics Clinique 93%
Gasoline Shell 80%
Major League Sports NFL 86%
Pizza Domino’s 84%
Quick Service Restaurant Subway 95%
Soft Drinks (Diet) Diet Coke 89%

Source: Based on “Brand Keys 2013 Customer Loyalty Index Finds Seismic Shift I How Consumers Emotionally Engage with Products, Services,” Press Release, brandkeys.com

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Listed are the top brands according to Brand Keys Customer Loyalty Index in select product categories. Brand Keys identified top performing brands in 54 different product categories.
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Brand Equity
Brand parity
Brand equity
Set of characteristics makes brand unique
Helps fight brand parity
Perceived better

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Brand parity is when consumers see very few differences among brands. Brand equity is a set of characteristics that makes a brand unique. Brand equity helps fight brand parity situations because the brand is perceived as being better.
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Figure 2.16 Methods of Measuring Brand Equity
Financial value
Stock market value
Revenue premium
Consumer value

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Brand metrics, which measure the return on branding investments, are used to measure brand equity. Four primary methods are used. Financial value estimates the cash flow of a brand based on its unique strengths and characteristics. Stock market value uses stock evaluations to measure brand equity. With the revenue premium approach, a brand is compared to a generic brand within the product category. Consumer value attempts to measure brand equity based on input from consumers.
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Figure 2.17 Top Ten Most Loved Brands
Rank Company Emotional Index
1 Disney 74.7
2 Yahoo! 74.3
3 Google 74.2
4 Sony 74.1
5 Nestle 73.3
6 Auchan 72.9
7 Netflix 72.8
8 Whole Foods 72.7
9 Apple 72.7
10 Lowe’s 72.5

Source: Based on Christopher Heine, “Check Out the Top 100 Beloved Brands,” Adweek, adweek.com, October 10, 2013.

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The top ten most loved brands was compiled by APCO Worldwide from a survey of 70,000 consumers. The study measured eight emotional feelings consumers have about brands – understanding, approachability, relevance, admiration, curiosity, identification, empowerment, and pride.
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Private Brands
Popularity has fluctuated
Connotation of low price, low quality
Historically  price-sensitive consumers
Retailers investing in private brands
Consumers see few differences

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The popularity of private brands has fluctuated over the years. In the past, private labels were seen as low priced, low quality goods. Historically, only price-sensitive consumers purchased private brands. Because of the higher gross margins on private brands, retailers began investing into their private brands. As a result, 72% of consumers today see private brands as being equivalent to manufacturers’ brands.
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Figure 2.18 Changes in Private Brands
Improved quality
Perceived as a value purchase
Higher loyalty towards retail outlets and lower loyalty towards specific brands
Used to differentiate retail outlets
Increased advertising of private brands
Increased quality of in-store displays and packaging of private brands

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Private brands (labels) have changed in a number of ways. The quality of private labels has improved. In fact, most consumers believe the quality of private labels is now equivalent to brand labels. In most cases, the price of private labels is below manufacturers’ brands, which consumers see as a value purchase. With the rise of large retail store chains, consumers have become more loyal to retail stores and less loyal to specific brands. For example, a consumer may say “whatever brands are sold by Dillard’s (or another retail store) is okay because that is where I want to shop.” Retailers are now using private labels to differentiate themselves from other retail outlets. In addition to improving quality, retailers have invested more money in advertising private labels, improving in-store displays of private labels, and improving the packaging of private labels. The result is that now many consumers cannot tell the difference between a retailer’s own private labels and a manufacturer’s label.
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Advantages to Retailers Private Labels
Higher gross margins
Lower prices
Greater loyalty to stores and brands within a store
Differentiates stores from national brands
J.C. Penney – private labels

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Private labels are attractive to retail stores for a number of reasons. Because the retailer owns the private label, the gross margins earned per product are higher than on manufacturers’ labels. This means the retailer can lower the price of the private label and still make more money. It also makes the private label attractive to customers. With increased brand parity, consumers have become more loyal to stores and less loyal to national brands, which benefits the retailer and private labels. For instance, JC Penney offers more than 30 private label apparel lines, which accounts for 40% of sales in the apparel category. Because of the benefits of private labels, retailers are investing more dollars into advertising and marketing. Often the ads do not tell consumers it is a private brand. In many cases, consumers do not know which brand is owned by the retailer (a private brand) and which one is owned by a manufacturer (national brand).
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Figure 2.19 Tactics Used to Combat Private Labels
Focus on core brands
Increase advertising
Introduce new products
Focus on in-store selling, packaging
Use alternative methods of marketing
Source: Adapted from Vanessa L. Facenda, “A Swift Kick to the Privates,” Brandweek, Vol. 48, No. 31 (September 3, 2007), pp. 24-28.

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Because of the rise in popularity and sales of private brands, manufacturers have been forced to look at strategies to fight back. Some manufacturers have chosen to focus on core brands. They may or may not drop some of their other brands, but the focus is on the core brands. For these brands, advertising budgets are increased. Innovation and new products are introduced sooner and more often. There is a greater focus on in-store selling and packaging. Rather than focus only on traditional media, alternative methods of marketing are pursued.
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Packaging
Final opportunity to make impression
69% of purchase decisions made in-store
Have three seconds to catch attention
Must stand out
Tell customers what is inside

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The importance of packaging should never be overlooked. It is the final opportunity to make an impression. Research has shown that 69% of purchase decisions are made in the store. This means packaging can be influential in the final purchase decision. Research has further shown that a package has three seconds to catch someone’s attention. Therefore, it needs to stand out. It needs to tell customers what is inside, or why they should look inside.
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Figure 2.20 Primary Purposes of Packaging
Protect product
Provide for ease of shipping and handling
Provide for easy placement on shelves
Prevent or reduce theft
Prevent tampering (drugs and food)
Meet consumer needs for speed, convenience, and portability
Communicate marketing message

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A primary purpose of packaging is to protect the product. It also should provide for easy shipping, moving, and handling of the product from the manufacturer to the retailer. It should provide for easy placement on store shelves. For many products, the package should prevent or reduce theft and tampering. Packaging must meet consumer needs for speed, convenience, and portability. Lastly, packaging should communicate a marketing message that resonates with buyers and is integrated with the marketing of the product, thus everything involving the brand from advertising to packaging is speaking with one voice.
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Labels
Must meet legal requirements
Provide marketing opportunity

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Labels are an important component of packaging. They must meet legal requirements in terms of listing contents and providing information on ingredients. But, labels also provide a marketing opportunity. Words such as gourmet, all-natural, and premium are used to convey what is offered and why it is important to consumers. Labeling can be the last opportunity to tell consumers about a product.
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Figure 2.21 Uses for QR Codes Packages and Labels
Access product information
Access videos on product use
Access recipes and nutritional information
Compare sizes, brands, and styles
Access product reviews and ratings
Provide links to social media and entertainment sites
Source: Based on Heidi Tolliver-Walker, “The Top Five Most Effective Ways to Use QR Codes on Packaging,” Seybold Report: Analyzing Publishing Technologies, Vol. 12, No. 1, January 9, 2012, pp. 2-6

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QR codes have gained popularity with consumers because of the rising use of smart phones and QR code apps. As a result, brands are placing QR codes on packages and labels. This slide shows the various uses for a QR code. It can provide access to additional product information posted online and videos on how to use the product. For food items, the QR code can be linked to recipes and nutritional information. For clothing, sizes, brands, and styles can be compared. For higher priced goods, product reviews and ratings can be provided. Sometimes brands want consumers to access social media or entertainment sites.
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Ethical Issues
Brand infringement
Brand name becomes a generic term
Domain or cyber squatting

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Marketers can face some ethical issues in the area of brand management. First, brand infringement occurs when a company takes a brand name that is very similar to a current, successful, and popular brand. Victor’s Secret was a brand infringement on the brand Victoria’s Secret. Second, sometimes brand names become the generic term for the product category, such as Xerox and band aids. More recently, the term Google has gained generic status. The last ethical issue is domain or cyber squatting, which is the purchase of website domains that individuals know are or will be valuable to a business or person. The reason for purchasing the domain is to be able to sell it for a high price later.
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International Implications
Adaptation vs. standardization
Standardization reduces costs
Shrinking world  standardization
High-profile, high-involvement – global brand
Low-involvement products – local brand
Packaging and labeling
Image and positioning issues

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For global firms, brand management is an important issue. A major decision that has to be made is should the brand use a standardization approach to marketing or adaptation? Standardization is cheaper because the same brand name is used in multiple countries, and the same marketing plan is followed. With a shrinking world due to advances in information technology, standardization makes sense. Most people have access to media and communication from around the world and are exposed to people from around the world. All of this leads to standardization becoming more attractive. For high profile, high involvement products, using a global brand works. But, for low involvement products, it is best to use an adaptation approach and develop local brands. Packaging and labeling issues involve more than language translations. It is important to ensure colors and content do not offend. Imaging and positioning should also be considered.
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Blog Exercises
Sears

Target

Branding

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The blog exercises for Chapter 2 include Jeep, Olive Garden, and videos about consumer behavior. Links are embedded in the text for each.
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Integrated Advertising, Promotion, and Marketing Communications

Seventh Edition

Chapter 3

Buyer Behaviors

Learning Objectives (1 of 2)
3.1 What elements are involved in internal and external information searches by consumers, as part of the purchase process?
3.2 What three models explain how individuals evaluate purchasing alternatives?
3.3 What trends are affecting the consumer buyer environment?
3.4 How do the roles played by various members of the buying center and the factors that influence them impact business purchases?

Learning Objectives (2 of 2)
3.5 What types of business-to-business sales are made?
3.6 What are the steps of the business-to-business buying process?
3.7 How does dual channel marketing expand a company’s customer base and its sales?
3.8 How can a company overcome international differences when adapting a buying process?

Chipotle Mexican Grill
Chipotle – ripened, dried jalapeno
New business, Steve Ells, 1993
Simple menu
Ordering quick and easy
McDonald’s purchased minority interest
Now 800+ units
Uses organic foods when possible
McDonald’s acquired Chipotle

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Chipotle is a dried, ripened jalapeno. The Chipotle Mexican Grill was founded by Steve Ells in 1993 based on that one single item – chipotle. He created a simple menu that made ordering quick and easy. Seeing a potential for growth, McDonald’s purchased a minority interest. By 2003, 300 new restaurants were opened. Later in the decade, the company began adding nearly 100 restaurants a year, topping at 800 units by 2009. In the late 1990s, McDonald’s acquired majority ownership, although Steve Ells remained as operational manager. The company has spent relatively little on advertising. Instead, an online presence and word-of-mouth have supported the company’s growth.
4

Chapter Overview
Consumer purchase process
Consumer buying environment
Recent trends in consumer behavior
Business buying center
B-to-B purchasing process
Dual channel marketing

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Chapter 3 begins with an overview of the consumer purchasing process and the consumer buying environment. Both are important in designing marketing communications. The next part of the chapter addresses current trends in consumer behavior. The last part of the chapter examines business-to-business buying behaviors. The buying center is an important part of the buying process. Often, products are introduced in the B-to-B market, then later marketed to consumers. Dual channel marketing involves marketing to both consumers and businesses.
5

Figure 3.1 Consumer Decision-Making Process

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Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
The consumer decision-making process involves five steps. The first step is problem recognition. It involves a consumer recognizing he/she needs something, has run out of something, or has an interest in something. Step two is information search. Consumers will first search internally for information. If they have enough information already stored in memory, then they will move to the next step. If not, then the consumer will conduct an external search. For high involvement and high dollar purchases, most consumers will conduct an external search. Step three is evaluation of alternatives. This may take only a few minutes for low cost, low involvement decisions to several months for high involvement decisions. After alternatives are evaluated, consumers will move to the next step, the purchase decision. While consumers will normally purchase the brand they intended to buy, sometimes in-store signage or deals will alter the purchase decision. The last step in the process is postpurchase evaluation. Consumers will determine the level of satisfaction with the purchase, which will impact their next purchase decision for that product.
6

Consumer Purchasing Process
Consumers recognize a need or want
Physical
Social
Psychological
Can be triggered by advertising

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The first step in the consumer decision-making process is the recognition of a need or want. It can be a physical need or want, such as thirst or hunger. It can be a social need or want, such as seeing a friend with the latest cell phone or a new car. It can be a psychological need or want, such as purchasing a new outfit to wear to feel good about themselves, or because they are depressed and buying something lifts their spirits. Many purchases are triggered by running out of something, such as groceries, food, and beverages. But, advertising can also trigger a need or want. This advertisement for Skyjacker can trigger a desire for a lift kit for a vehicle. The desire can be reinforced through seeing someone else’s vehicle with one installed, or the reverse can occur.
7

Information Search
Internal search
External search

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Once a problem, need, or want has been recognized, consumers move to the next stage of the process, information search. Understanding information search is important for marketing communications. There are two types of information search, internal and external.
8

Internal Search
Think about brands
Quickly reduce options
Choice based on past experience
Brand awareness and brand equity are important.

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The internal search for information is a mental activity. Consumers search their memories for information. They think about brands they have purchased in the past. If the brand met their needs and the experience was good, it is very likely they will buy the same brand again. If not, they will conduct a longer internal search or move to the external search for additional information. Past experience is an important part of an internal search and how long the individual thinks about various brands. Consumers typically reduce the number of options quickly and concentrate on only a couple or small set of options. With internal search, brand awareness and brand equity are important. If a consumer is not aware of a brand, such as Kraft, then it will not be considered as a purchase option unless the search process moves to an external search. The higher the level of brand equity, the more likely the brand will be purchased with little mental effort and no additional consideration of other brands.
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Figure 3.2 External Search

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Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
The external search for information normally occurs under three conditions. First, the consumer was not happy with the last purchase experience and wants another brand or product. Second, it is a high-involvement decision, and the consumer wants more information. Third, it is a socially visible product ,and the consumer wants to make sure others will approve or be impressed with the purchase decision. The amount of time consumers spend searching for information depends on 1) their ability to search for information, 2) their level of motivation to search for information, and 3) the perceived cost of searching versus the perceived benefit of searching.
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Ability to Search
Determines extent of search
Education level
Increases search
Knowledge of product and brands
Moderate level – most likely to search

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The ability to search for information determines the extent of the information search process. Ability consists of a person’s educational level combined with their knowledge of the product and brands. Educated individuals tend to search for more information and spend more time searching than individuals with less education. Knowledge of products and brands has an inverted U-shape curve. Individuals with little knowledge of a product category or brands tend not to search for information, primarily because they do not know where or how to search for information. They don’t know the product category well enough to know what to look for. At the other extreme, individuals with a great deal of knowledge spend less time searching since they already possess the knowledge. The group that spends the most time searching is in the middle. They have some knowledge, so they have an idea of what to look for and what to ask, but not enough knowledge to make a decision.
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Level of Motivation
Level of involvement
Need for cognition
Level of shopping enthusiasm

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The level of motivation has an impact on the amount of time spent in external search. Motivation is determined by involvement, cognition, and shopping enthusiasm. The higher the level of involvement, the more time a consumer will spend in searching for additional information. The need for cognition is the level of mental activity a person enjoys. People who have a high need for cognition, that is they want to think about options before making a decision, will spend more time searching for information. Some people want to weigh every option and make sure they are right, so this need to consider all angles will lengthen the search process. The last motivating factor is the person’s enthusiasm for shopping. Individuals who enjoy shopping and comparing brands will spend more time than individuals who dislike shopping.
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Cost versus Benefits
Actual cost
Subjective cost
Time
Anxiety
Opportunity cost

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Consumers will weigh the cost versus the benefits of an external search. There are the actual costs to search, such as driving to the mall to look at various brands. Then there is the cost of the product. If a particular brand is purchased and the consumer doesn’t like it, that money is basically lost. So for high cost items, there is more pressure to search to make sure the right decision is made. Then there are subjective costs, the amount of time spent and the anxiety involved. For most people, time is valuable. Yet, if the purchase decision causes anxiety, then spending more time searching for information is worth it to reduce the anxiety and ensure the right decision is made. The last consideration is opportunity cost. Once the purchase is made, the consumer forgoes the alternatives. The higher the perceived costs to search for information, the less consumers will search. Alternatively, the higher the perceived benefit in gathering additional information, the more time a person will spend searching.
13

Consumer Attitudes (1 of 2)
Affective
Cognitive
Conative

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Consumer attitude can be impacted by effective marketing communications. Attitude is the mental position a person takes towards a topic, person, or an event that influences an individual’s feelings, perceptions, learning processes, and behaviors. Attitude consists of three components.
Affective is the feeling and emotional part of attitude.
Cognitive is the individual’s knowledge, understanding, and interpretation of a topic, person, or thing.
Conative is an individual’s intentions, actions, or behavior.
This ad for St. Francis North Hospital is designed to impact the cognitive component of attitude by providing information and knowledge about imaging technology.
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Attitude Sequence
Cognitive → Affective → Conative
Affective → Conative → Cognitive
Conative → Cognitive → Affective

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In terms of influencing or changing consumer attitudes, marketers have three options. The most common sequence is to first impact a person’s cognitive beliefs and knowledge about a product, then develop emotions and feelings for the brand, which then results in purchasing the product. The second sequence begins with affective, the feelings and emotions. The marketing message is designed to elicit an emotional response followed by the purchase action. Then once the person has tried the product, he/she will make judgments about it. The third sequence begins with the conative. The idea is to get the person to try it. Food items and other low cost products often use this approach. After trying a product, a person will develop thoughts about it and then decide if he/she likes it or not. Feelings follow the knowledge. The sequence determines the content and how an ad is designed. Ads aimed at the affective component will look different than ads designed to impact the cognitive or conative component of attitude.
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Consumer Attitudes (2 of 2)
What emotion does this Salvation Army advertisement solicit?
Which attitude sequence would be the most likely for this ad?

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This ad is designed to impact the affective component of attitude. While information is presented, the photo is designed to make a person feel empathy. In terms of attitude sequence, this ad is using affective → conative → cognitive.
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Figure 3.3 Personal Values
Comfortable life
Equality
Excitement
Freedom
Fun, exciting life
Happiness
Inner peace
Mature love
Personal accomplishment
Pleasure
Salvation
Security
Self-fulfillment
Self-respect
Sense of belonging
Social acceptance
Wisdom

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Attitudes reflects an individual’s personal values. Values are strongly held beliefs about various topics and concepts. Values frame attitudes and guide personal actions. This is a list of some of the primary values individuals hold. The strength of the value will determine a person’s attitude and actions. Individuals who value and crave excitement will have different attitudes and make different purchase decisions than people who value mature love, wisdom, or personal accomplishment. In designing marketing messages, creatives need to consider personal values and how products can help an individual obtain the values being sought.
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Which Personal Values Does This Ad Target?

Figure 3.4 Top Ten Most Patriotic Brands
Rank Company Patriotic Emotional Engagement Score
1 Jeep 98%
2 Hershey 97%
3 Coca-Cola 97%
4 Levi-Strauss 95%
5 Walt Disney 95%
6 Colgate 94%
7 Zippo 93%
8 Wrigley’s 92%
9 Ralph Lauren 91%
10 Kodak 90%

Source: Based on “Jeep Leads List of 25 Most Patriotic Brands,” USA Today, www.usatoday.com/story/driveon/2013/07001/most-patriotic-brands-jeep/2481337, July 1, 2013.

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Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
The table shows the results of a survey of 4,500 consumers who were asked to rate the most patriotic brands . The study was conducted by Brand Keys. Jeep had the highest patriotic emotional engagement score, but was followed closely by Hershey and Coca-Cola.
19

Figure 3.5 Cognitive Map for Ruby Tuesday

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Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Cognitive maps are simulations of the knowledge structure and memories embedded in an individual’s brain. These structures contain a person’s assumptions, beliefs, interpretations of facts, feelings, and attitudes about the world around them. These thoughts interpret new information and determine a response to fresh information or a novel situation. This map is a crude illustration of the structure of the brain and the many linkages that are present. This represents one individual’s cognitive map of Ruby Tuesday. Ideas connected to Ruby Tuesday are restaurants, dine-in, excellent service, and slow. When the person thinks of slow, they immediately think of Mel’s Diner. When the person thinks of restaurants, fast foods come to mind, then pizza, then Pizza Hut and Little Caesar’s. It is easy to see from this illustration how concepts, thoughts, and ideas are all interconnected in our brains.
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Cognitive Mapping
Show cognitive linkages
Process new information
Retain information

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Cognitive mapping serves a number of functions. It provides an idea of how the brain contains many linkages at a number of levels. Cognitive maps allow individuals to deal with new information in one of three ways. New information that is consistent with current information will strengthen linkages that already exist. If no linkage is there, then the consumer may develop a new linkage between the concepts. On the other hand, the person may determine the new information is not consistent with current linkages and dismiss it immediately. It is these linkages that allow consumers to retain information in long-term memory. Unless it is connected in some manner in the cognitive map, the information will not be stored for future use.
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Figure 3.6 Role of Marketing Messages in Cognitive Mapping

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Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Marketing messages have three roles when it comes to cognitive mapping. First, the message may be designed to strengthen current linkages. Second, it may be designed to modify current linkages. Third, it may create new linkages. Adding new linkages or modifying current linkages is more difficult than strengthening current linkages.
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Principles Concerning Processing of Information and Cognitive Mapping
Cognitive mapping enhances the movement of messages from short-term to long-term memory.
Most persuasive messages reinforce current linkages.
Repetition is necessary to establish new linkages.
Modifying or creating new linkages is difficult.

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Cognitive mapping helps explain how consumers process information and how messages are moved from short-term memory to long-term memory. Most persuasive messages reinforce current linkages, which is the easiest task for marketers. Establishing new linkages is more difficult. It requires repetition. Just like repeating a phone number several times helps move the number from short-term to long-term memory, seeing an advertisement message a number of times helps establish new linkages. It is difficult to modify and create new linkages. It takes time.
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Figure 3.7 Methods of Evaluating Alternatives

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Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
The third stage of the consumer decision-making process is the evaluation of alternatives. Understanding how consumers evaluate brands and products is important for creating effective marketing messages. Three models illustrate the nature of evaluation of alternatives: evoked set, multiattribute, and affect referral.
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The Evoked Set Method (1 of 2)
Inept set
Inert set
Evoked set

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The evoked set consists of brands that an individual considers in making a purchase decision. Evoked sets are often generated internally during the information search stage of the process. It consists of brands the consumer is aware of and would consider purchasing, often brands that the consumer has used in the past. Two other sets of interest to marketers are the inept and inert sets. The inept set are the brands the consumer will not purchase, either because of a bad personal experience or information received from another source. It may be something someone told them. The inert set are brands the consumer does not know anything about or has so little information a judgment cannot be made. If a brand is in a consumer’s inert set, the goal is to transfer it to the evoked set because in most purchase situations only brands in the evoked set will be considered. For instance, if a consumer decides to dine-out, in most cases, only brands in the evoked set will be considered.
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The Evoked Set Method (2 of 2)
How important is it for each of the following brands to be a part of a consumer’s evoked set?
Guess (jeans)
Advil (pain medicine)
Head and Shoulders (shampoo)
Black and Decker (power tools)
C and H (sugar)
Smith and Kline (attorneys)
Hall’s (cough drops)
Netflix (video rentals)
Dr. Nelson (neurosurgeon)
Pearle Vision (optical)

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If consumers are not likely to conduct an external search for information, then being in the evoked set becomes more important. Also, for lower involvement type products, being part of the evoked set is important because consumers will not spend a great deal of time evaluating alternatives. The less time spent in the evaluation of alternatives, the more important it is to be part of the evoked set. Also, if a brand wants to develop a high level of brand equity with consumers, it starts with being in the evoked sets of individuals.
Answers will vary among students on how important the evoked set would be for these brands. Certainly, for an attorney and neurosurgeon, being part of the evoked set is not too important since people will very likely do a more extensive search for information.
26

The Multiattribute Approach
High-Involvement Products
Brand’s performance for each attribute
Importance of each attribute

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The multiattribute approach is used for high-involvement purchases, such as vehicles. With the multiattribute approach, the evaluation is based on two dimensions: 1) the brand’s performance on product or brand attributes and 2) the importance of each attribute. The higher that a brand rates on attributes that are important to consumers, the more likely the brand will be chosen. It would be extremely rare for a brand to score the highest on all attributes. Instead, there are trade offs. In purchasing a car, not one single automobile is likely to have every feature the consumer wants, especially if the auto is being purchased from a dealer’s lot and not being ordered. The same is true for purchasing a home. Consumers must make tradeoffs. The final choice comes down to the brand that offers the most features desired by consumers. While consumers aren’t likely to do this mathematically on paper, they will conduct a simulated approach by mentally comparing one brand against another on various attributes.
27

Affect Referral
Saves mental energy
Multiattribute approach may have been used previously
Consumers often develop emotional bonds with brands.

Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Affect is the third part of attitude. It deals with emotions and feelings. With the affect referral method, consumers purchase the brand they like the best. There may not even be a strong reason they like the brand, they just do, or they may have a strong emotional attachment to the brand for some reason. It may have been a brand their parents used, so they developed an emotional attachment. The affect referral method saves energy. Consumers don’t have to think about the other brands or consider other alternatives, they just purchase the brand they like. It’s possible that the multiattribute approach was used in the past to determine the best brand, so the process does not have to be repeated. The experience with the brand was positive, so consumers continue buying it and over time develop a stronger emotional bond with it. In this ad, Oscar Mayer wanted to tap into the affective component of attitude and encourage consumers that with Oscar Mayer hotdogs “it doesn’t get better than this.”
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Figure 3.9 Trends Affecting Consumer Buyer Behavior
Age complexity
Gender complexity
Active, busy lifestyles
Diverse lifestyles
Communication revolution
Experience pursuits
Health emphasis

Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Consumer behavior is a moving target and always changing because people change and culture changes. The environment and economy changes, forcing changes in the way consumers purchase products. These trends have impacted consumer behavior in recent years and are expected to modify future buyer behaviors. Age complexity refers to children growing up at a much faster rate and becoming involved in purchasing products which in the past were for teenagers and adults. At the other end of the spectrum, older consumers refuse to get old, purchasing products of younger generations. Gender complexity refers to the merging of the gender roles in occupations, products, and family relationships. Individualism refers to consumer desires to be treated as individuals and wanting products that are made specifically for them. They don’t want to be like everyone else. Today’s consumers lead active and busy lifestyles and want goods and services that cater to that lifestyle. Cocooning refers to the desire to stay at home, to build relationships with family and friends. With the pressures of life, there is a trend for people to enjoy an occasional pleasure pursuit as a reward. Finally, with an aging population there has been a growing emphasis on health and products that promote good health and that treat health problems.
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Figure 3.10 Acceptance of Female Products by Millennial Men
Source: Based on Lucia Moses, “Millennial Guys Are Turning to Makeup,” Adweek, www.adweek.com/news/advertising-branding/millennial-guys-are-turning-makeup-150313, June 19, 2013.

Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Gender complexity reflects the changing roles of men and women. It also reflects a merging of views and acceptance of the opposite gender in untraditional ways. This survey shows the acceptance by millennial men of female fashions and the use of grooming products that in the past were considered for female use only.
30

Figure 3.11 Responding to New Consumer Buying Trends
Monitor consumer environment for changes
Create goods and services that are compatible with changes
Design messages that reflect changes

Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Understanding consumer buyer behavior trends is important. Companies need to respond to these changes in buying behaviors. The first step is to monitor the consumer environment and note especially any changes in patterns of behavior. The second step is to create goods and services that are compatible with these changes. Third, marketing messages that reflect these changes should be designed. This ad for St. Francis North Hospital focuses on the emphasis people now place on health.
31

What Trend Do These Ads Target?

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The Kraft ad on the left targets the “busy lifestyle” trend by providing a quicker, easier-to-use solution to preparing food. The ad for Community Trust Bank highlights the communication revolution trend by emphasizing a mobile app for banking.
32

Business-to-Business Buyer Behavior

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In the business-to-business sector, people still make purchase decisions. The process that is used is different, which means marketers will have to use a different approach. Often more than one person is involved in the decision. Further, corporate policies can restrict decisions and decision rules can affect purchase activities. Factors such as costs, quality, and profit margins will also influence the decision.
33

Figure 3.12 The Buying Center

Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
In many business purchase decisions, a buying center concept is present. It usually is not an official group, but individuals play various roles in the buying center. Each role can have more than one person, and one person can serve in more than one role. Users are the members of the organization that actually use the good or service. Buyers are the individuals who have formal responsibility for making the purchase. Influencers are individuals who shape the decision by providing information or criteria used in the decision process. Deciders are people who authorize purchase decisions. Gatekeepers control the flow of information to members of the buying center. Marketing to a business involves understanding these roles and locating the individuals within a business organization that have these roles.
34

Figure 3.13 Individual Factors Affecting the Behaviors of Buying Center Members

Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Because members of the buying center are people, there are a number of individual factors that influence the buying process. The buying center becomes a very complex social organization when a number of people become involved in buying decisions. Personalities, ambitions, and personal agendas may cause conflict and tension. When individuals’ jobs are affected, they tend to become more involved.
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Individual Factors Affecting Business Buying Centers (1 of 2)
Personality
Decisive person
Extrovert
Introvert
Roles
Individual’s age, heredity, ethnicity, gender
Socially constructed
Motivation
Match individual’s goals to organization’s goals

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The personality of individuals will affect the purchase decision and the buying center. A decisive person will be more involved and direct. An extrovert will spend more time talking, while an introvert will be too timid to speak. The roles people have within the organization will impact the buying center. Roles are socially constructed and also influenced by a person’s age, heredity, ethnicity, gender, and cultural membership. A person’s degree of motivation depends on the match between the individual’s personal goals and the goals of the organization. Goals to succeed within an organization usually translate into greater involvement.
36

Individual Factors Affecting Business Buying Centers (2 of 2)
Level of power
Role in buying center
Official position
Impact of decision on personal performance
Risk
Risk avoiders
Level of involvement
Cognitive capacity
Personal objectives

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People derive their level of power from official and unofficial roles within an organization. The more power an individual has, the more he/she will be involved. Roles may be defined by the buying center and the impact the decision has on an individual’s personal performance. Risk and the attitude towards risk is important. A risk aversive person will seek a safe path and may want to stay with the current vendor. Levels of involvement will vary. The higher the level of involvement, the more questions individuals will ask and the more active they will be in the process. Individuals who have a high level of cognition will spend more time asking questions and talking. The last factor is personal objectives. Individuals may act within a buying center in such a way that will promote individual objectives over company objectives, but in a way that is not noticed by others.
37

Types of Business-to-Business Sales
Straight rebuy
Modified rebuy
New task

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Buying decisions can be classified into three categories: straight rebuy, modified rebuy, and new task. With a straight rebuy, the current vendor is contacted and a new order is placed. Alternatives are not considered. With a modified rebuy, a company is open to new vendors and will evaluate the current vendor as well as new possibilities. A new task is when a company is making a purchase with little or no experience. It does not occur frequently, so often the vendors help in the process.
38

Figure 3.14 Reasons for Modified Rebuy
Dissatisfaction with current vendor
An attractive offer from a different vendor
End of contract with current vendor
Individuals with little or no experience

Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Modified rebuys occur for four different reasons. The company already has a current vendor, but has chosen to look at additional vendors and solutions. Reasons for moving from a straight rebuy to a modified rebuy include the following.
The company is dissatisfied with the current vendor.
Another vendor has made some type of attractive offer and members of the buying center feel it is worth looking at again. It may be a lower price, better quality, or some other factor that makes the buying center open it up for evaluation again.
Companies will often take bids at the end of contracts with vendors. They may stay with the current vendor, or they may not.
The individuals making the decision have little or no experience and rather than stay with the current vendor they want to see what other vendors can offer. There may be features the current vendor is not supplying.
39

B-to-B Buying Process
Identification of needs
Establishment of objectives
Identification of vendors
Vendor evaluation
Vendor selection
Negotiation of terms
Postpurchase evaluation

Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
The first step in the b-to-b buying process is the identification of needs. It may be a need for raw materials, or a new vehicle, or even new land. Step 2 is to establish objectives. It is important to do this before vendors are contacted to ensure the decision is unbiased. Step 3 involves identifying possible vendors or sending out a request for proposals. Once vendors have submitted bids, evaluation begins. Members of the buying center will screen out vendors who do meet the specifications. Depending on the size of the bid, this process of evaluation may take just a few hours to several weeks. Once the vendor has been selected, terms are negotiated. Evaluation of the vendor then occurs after the purchase. With business purchases, it often becomes a continuous process with repeat orders, the straight rebuy situation.
40

Figure 3.15 A Comparison of the Business-to-Business Buying Process to the Consumer Buying Process

Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
The business-to-business buying process is very similar to the individual buying process. Both have a problem recognition that starts the process. Information search for individuals is similar to establishing objectives and identifying vendors in the b-to-b. Both processes involve an evaluation of alternatives. The purchase decision in the consumer process is split into vendor selection and purchase negotiations for businesses. Finally, both involve a postpurchase evaluation stage.
41

Dual Channel Marketing
Consumer and B-to-B markets
Spin-off sales
Image concerns

Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Dual channel marketing involves selling products to both consumer and business markets. The process often begins with the B-to-B market. Individuals like a brand they are using at work and purchase the brand for personal use, which is spin-off sales. It may be the brand of computer, vehicle, or cell phone. The challenge for marketers is should they market both channels the same way, or should they be different? There are also image issues to consider.
42

Figure 3.16 Dual Channel Marketing Strategies
Use different communication messages
Create different brands
Use multiple or different channels

Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Dual channel marketing requires one of three approaches based on how the product is purchased and used. 1) The same brand is sold in both markets, but the communication messages are different. This often requires having different marketing plans. 2) A second approach is to create different brand names and a different marketing plan for each brand. With this approach involves two totally separate approaches and is motivated by the idea that the consumer and business markets are not compatible. 3) With the last approach multiple or different channels of distribution are used for the consumer market and b-to-b market. In most cases, this approach involves different brands as well.
43

International Implications
Cultural assimilator
Understand purchasing process
Strong brand
Visible global brand for B-to-B

Copyright © 2016, 2014, 2012 Pearson Education, Inc. All Rights Reserved.
Buyer behaviors vary widely around the world. A cultural assimilator is a valuable person to have on staff to assist in marketing plans for other countries. It is important to understand the purchase process. The way products are purchased in the U.S. is not the same as it is in Japan, Brazil, or other parts of the world. Having a strong brand name helps with global expansion. Even for B-to-B markets, global brands are important.
44

Blog Exercises
Jeep

Olive Garden

Consumer Behavior

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The blog exercises for Chapter 3 include Jeep, Olive Garden, and videos about consumer behavior. Links are embedded in the text for each.
45

46
Marketing
Message
Strengthen current linkage
Modify current linkage
Create new linkage
Information
Search
Evaluation of
Alternatives
Evoked set
Multiattribute
Affect referral
Problem
Recognition
12%
18%
14%
60%
32%
45%
51%
11%
16%
14%
12%
0%
10%
20%
30%
40%
50%
60%
70%
Eyeliner
Foundation
Nail polish
Skin care
Facials
Wax/hair
removal
Man bag
Spanx
Sarong
Leggings
Women’s
jeans
P
e
r
c
e
n
t

o
f

S
a
m
p
l
e
Use Female Grooming Products
Acceptance of Female
Fashions
Problem
Recognition
Information
Search
Evaluation
Of
Alternatives
Purchase
Decision
Consumer Buying Process
Identification
o
f
Needs
B
–
to
–
B Buying Process
Establish Specifications
Identify Vendors
Evaluate Vendors
Select Vendor
Postpurchase
Evaluation
Purchase Negotiations

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