Effective segmenting and targeting allow a company to market directly to the customers most likely to buy the brand instead of spending unnecessary money on a mass campaign that will not generate the greatest return on investment. After selecting the segments, prioritizing begins. Profit potential, business objectives, and marketing objectives are prioritizing guides. The design of marketing communication messages is to reach specific segments. Companies use targeting process to determine how much a company should spend reaching each segment. This specific targeting of the marketing communication message is a strategic planning key issue. The company budget, marketing objectives, and estimated sales and profit returns from each segment is where companies begin to find answers. A company has to balance carefully retention and acquisition objectives when segmenting and targeting.
Only when a company knows whom they will target can the brand do a strengths, weaknesses, opportunities, threats, and trends analysis to develop strategies and objectives that are persuasive and relevant. A company can leverage strengths and opportunities and fix weaknesses through research. The controllable elements within the SWOTT analysis use the four P’s of product, place, price, and promotion to shift perceptions of the brand to a more favorable perception. Finding out what current perceptions are and what changes are required happens through research. Anticipating threats and counteracting them requires research as well.
The second step is to decide how to convince these segments to buy into the Olive brand. Olive needs to create a core brand promise to persuade customers to buy Olive’s range of products. A positioning statement created from the basic attributes that customers look for while buying furniture is what Olive needs. The statement will determine how customers perceive Olive as a brand and what they expect from it. Olive chose to use comfort, affordability, and style as the key attributes to position Olive with help from the Franklin McCarthy survey. Positioning is a dual challenge for established, global brands entering new markets. They need to customize their global positioning according to the needs of the new market and ensure that the positioning for a certain market stays within the realm of their global positioning. Today’s customers inhabit a globalized environment where brands are easily available across different markets. If customers do not perceive the brand as standing for the same promise everywhere, customers will forget them. Successful message strategies blend emotional and rational thinking, convey brand relevance to the customer and are appealing. Organizations determine what communication objectives are before they analyze the audience for customer insight that will lead to a selling strategy.
The third step is to employ various communication tools to communicate what Olive has to offer to its potential customers. The total budget available for the communication plan is $32 million. The objective in this step of the simulation is to allocate budgets for each of the communication tools available. The allocation is based on reach, impact and cost for each tool. Allocating appropriate budgets to communication tools affect both the sales and the image of a brand. Each tool achieves different objectives, so it becomes important to allocate accordingly. When the budget mix is appropriate, it creates a positive impact on both sales and brand image.
The final stage of the simulation is about deciding what sales promotion activity to introduce to create a buzz in the market and formulating an advertising plan to communicate the chosen sales promotion offering to the target audience. Free accessories are attractive incentives and immediate discounts are powerful incentives to spend. Both promotion schemes have an immediate impact on sales, influences the customer positively toward the brand, creates opportunities for repeat purchases, and builds loyalty in the long-term. End of season discounts have a dramatic short-term impact but lead to discounting of the brand image. Print, television, and radio are good media options because of reach. Online marketing can play an effective support role and build loyalty at a personal level. Direct mail can be an effective support medium and a highly persuasive sales tool. Direct mail can create strong bonds at an emotional level and help a brand build a database of loyal customers. Direct mail is a cost effective option for certain brand activities.
Cross-functional teams rely on feedback. The sharing of current information is a critical element for decision-making. Employees who have direct contact with customers must listen to the customers. Periodic online employee surveys can be a useful tool for managers to make immediate changes where needed. Use of internal marketing helps the organization deliver a consistent brand message, which helps create an integrated brand positioning in the customers minds.
Developing a successful communication plan depends on the ability of all the elements in the planning process to blend with each other seamlessly because all the elements affect each other. As stated in the simulation, the plan will fail if the target segment is identified correctly but the positioning platform does not appeal to them, or if an incorrect choice in communication tools misses the intended audience. When the elements of a communication plan speak in “one voice,” to quote the simulation, the brand is successful with an “enduring brand image.” Strong positioning statements that appeal to target audiences by means of communication tools build powerful brands more effectively. Communicating a brand promise clearly needs a communication plan that has been well thought-out.
Works Cited
Clow, K. E., & Baack, D. (2004). Integrated Advertising, Promotion, and Marketing Communications (2nd ed.). New Jersey: Pearson/Prentice Hall.
Duncan, T. (2005). Principles of Advertising and IMC (2nd ed.). New York: McGraw-Hill/Irwin.
Semenik, R. J. (2002). Promotion and Integrated Marketing Communications. Cincinnati: Thomson/Southwestern.
