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Integrated Marketing Communications at Dow Chemical Company

IMC in Theory and Practice

Introduction Overview
Modern marketing calls for more than developing a good product, pricing it attractively, and making it accessible. Companies must also communicate with present and potential stakeholders, and the general public. Every company is inevitably cast into the role of communicator and promoter. For most companies, the question is not whether to communicate but rather what to say, to whom, and how often.1

The marketplace is not what it used to be. Industry dynamics and marketplaces have evolved substantially. They are changing radically as a result of major societal and environmental forces. In many industries the business world has moved closer to a global marketplace. Deregulation has opened the door for new ways of business and entrepreneurship. Technology has advanced rapidly. And the Internet has created new ways and opportunities to do business.2 Todays customers have more, better and faster access to information than ever. Bombarded by competing messages, they have learned to skim through the information overload, eliminate the garbage and find what they need. Increasingly, customers expect higher quality, service, and customization. They perceive fewer real product differences and show less brand loyalty. More than ever, they are better equipped to distinguish false marketing claims from substantive ones. They use the Internet and other sources to obtain extensive product and service information. Thus, they are able to shop more intelligently, which in turn makes them more price sensitive in their search for value. On the other side, brand manufacturers and service companies are facing intense competition among others from domestic and foreign brands as well as young high tech oriented businesses. The result is businesses facing rising promotion costs and shrinking profit margins. In todays world, mass-marketing is giving way to micro-marketing, by which organizations strive to identify and focus on the people most likely to buy. The one-product-fits all concept now fits fewer and fewer. Even niche marketing is giving way to one-to-one and customer relationship marketing. Marketing integration provides companies with a competitive edge by focusing all of the sales, marketing, and operations resources on promoting the same message throughout the customer and prospect base and doing everything possible to make sure that sales and marketing promises get consistently delivered. Marketing integration not only increases the chances that an organizations message will break through the clutter, but also that a customers expectations will be consistently met. Also, integrated marketing strategies ensure that the companys message have more impact with greater cost efficiency than old-fashioned strategies.

Problem Statement The purpose of this paper is to discuss the concept of Integrated Marketing Communication in theory and in practice. Specifically, the discussion will describe IMC in the context of communicating with customers, its difference to traditional marketing, the obstacles that prevent companies from adopting IMC practices, some critical issues to consider, and a checklist for attaining success in adopting an IMC program. Thereafter, this paper will describe several companies, including Dow Chemical, that have been successful in implementing IMC programs.

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Kotler, Philip; Marketing Management, The Millenium Edition, International Edition, Prentice Hall, New Jersey, 2000, p. 550. Fernndez Kettler, Hertha; Channel Alignment in the New Economy, Introduction, p. 1

Conceptual Discussion Communicating with Customers The marketing communication mix consists of five major modes of communication. These modes are advertising, sales promotion, public relations, personal selling, and direct marketing. Company communication, however, goes beyond these modes. For example, the products styling and price, the packages shape and color, the salespersons manner and dress, the places dcor, the companys stationery all communicate something to the existing and potential customers. Every brand contact delivers an impression that can strengthen or weaken a customers view of the company. Therefore, the whole marketing mix should be integrated to deliver a consistent message and strategic positioning.

Traditional vs. Integrated Marketing In the traditional organizational model, a company is made up of functional departments each of which is dedicated to a specific discipline or function. For example, among others, the typical organization has a sales department, a marketing department, an R&D department, a manufacturing department, and a distribution department. Often, these departments operate in their own little worlds, with the result that management silos emerge by which different departments operate with different agendas and not together. Furthermore, under the traditional organization structure, the sales and marketing message gets fragmented across a myriad of strategies and tactics. Marketing often develops messages that the salespeople fail to sell or which contain service promises that operations or customer service fail to deliver. In big organizations, the marketing messages even become fragmented across the different modes of the communication mix, because advertising, sales promotion, public relations, personal selling, direct marketing, and corporate Web site fail to leverage each other and/or work together. The result is clear: no uniform message, confusion among customers, declining brand loyalty, and excessive marketing costs. By contrast, integrated marketing mobilizes all of a companys communication strategies under a single vision and strategy implemented in concert by all of the organizations relevant departments. In the integrated marketing model, an organization becomes a cohesive unit with a single overall goal based on maximizing awareness among the target audience and making sure that the marketing message gets consistently distributed across all communication channels, i.e. sales and marketing media. Rather than operating in silos, the companys departments work together and in concert to make sure that each of their activities works toward the common goal. The American Association of Advertising Agencies defines integrated marketing communications (IMC) as follows:
IMC is a concept of marketing communications planning that recognizes the added value of a comprehensive plan that evaluates the strategic roles of a variety of communications disciplines for example, general advertising, direct response, sales promotion and public relations and combines these disciplines to provide clarity, consistency, and miximum communications impact through the seamless integration of discrete messages.

Obstacles to Integrated Marketing Communication Integrated marketing is not a new idea. Executives and managers worlwide have been talking about its advantages for many years, but few have taken the trouble to practice it. Recent changes in the marketplace, however, mean that companies that hope to survive must pay closer attention to integrated marketing and start acting accordingly.

There are several reasons why companies have not been able to move from their traditional marketing strategies to ntegrated marketing ones. A study of top management and marketing executives in large i consumer companies indicated that over 70 percent theoretically favored the concept of IMC offered by large advertising agencies, yet most of them did not buy the IMC package services, preferring to put together different specialized agencies by themselves.3 The resistance can be explained as follows. Large companies employ several communication specialists to work with their brand managers. Each specialist knows little about the other communication tools. Also, they usually have favorite outside agencies and oppose turning their responsibilities over to one superagency. They argue that the company should choose the best specialist agency for each purpose, not second- and/or thirdrate agencies simply because they belong to a superagency that offers a package of all-in-one. They believe that the ad agency will still put most of the advertisers money into the advertising budget. Other reasons for resistance to the change are related to the people themselves, the main ones being:
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- Turf and possessiveness: Most people are possessive of their domains. They do not want to share information that they worked hard to acquire and believe they own. They do not want to reveal their plans for success. Rather, they want others to be surprised and impressed by their plans and results. - Ego: This point is closely related to turf and possessiveness. Sharing means that people become equal. This in turn means that it becomes difficult to tell who is better, smarter, and more successful. - Budget: In the traditional company, budgets are allocated by department, according to needs and past results. People think that if departments work toward common goals, management might affect their budgets negatively. - Inertia and fear: These two points are typical components of peoples resistance to change in general. Firstly, inertia makes people want to keep doing what they have always done because it is simply easier. Secondly, people resist change because they fear the unfamiliar.

Some Critical Issues related to IMC Todays marketers talk a lot about the importance of building relationships and the need for customer relationship management. They understand that good relationships are the key to finding, developing, and having loyal, long-term customers. Yet many fail to recognize that it is only through IMC measures that businesses today can take the actions required to build those relationships. In his article Integrated Marketing published by the Sales Marketing Network at info-now.com, Rayna Skolnik mentions four critical issues to consider closely within this framework. Firstly, todays customers have more options, and they are more demanding than ever. They have access to more products, more sources of information, and more channels to buy, meaning that ultimately marketers have more competition than ever. Furthermore, todays customers do not settle for any type of product. If one company does not offer what they want, then another one will; and if none does, then they might prefer to go without rather than to accept something that does not please them. Secondly, the marketplace is changing. Traditional companies developed products or services, set sales goals, and devised plans for creating demand. In their book The New Marketing Paradigm: Integrated Marketing Communications, Don E. Schultz, Stanley I. Tannenbaum, and Robert F. Lauterborn call this traditional approach inside-out marketing, because the marketing plan originates inside the organization. In contrast, outside-in planning the basis of CRM originates with customers and their needs. Third, marketing managers today must be willing to change their thinking from This is what we want to sell; how will we market it? to This is what the customer wants; how will we provide it? Again, this is the basis of customer relationship marketing that requires IMC to be effective.
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Ibid, Kotler, p. 569. Skolnik, Rayna; Integrated Marketing, Sales Marketing Network, info-now.com, Oktober 2002.

Finally, companies must recognize the fact that integrated messages can only be sent by integrated companies. Surely, integrating a company could require organizational changes in terms of structures, hierarchies, and/or work processes. Yet the effort to integrate the company should be rewarded in the long-run by the results of the enterprise-wide effort to communicate the same marketing messages to the firms existing and potential customers.

Checklist for IMC Success In his article Putting Integrated Marketing Communications to Work Today, Public Relations Quarterly, Fall 1994, pp. 45-48, Matthew P. Gonring offers a checklist for organizations who want to achieve IMC. His recommendations are the following.
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Audit the pockets of communications-related spending thorughout the organization. Create shared performance measures. Use database development and issues management to understand your stakeholder. Identify all contact points for the company and its products. Analyze trends internal and external that can affect your companys ability to do business. Create business and communication plans for each local market. Appoint a director responsible for the companys persuasive communications efforts. Create compatible themes, tones, and quality across all communications media. Hire only team players. Link IMC with management processes, such as participatory management.

Similarly, Rayna Skolnik proposes the following steps to success:5 1. Identify needs precisely by conducting research. 2. Integrate outside agencies with the company and with each other, or better use a single agency to take care of all the elements of the communication mix. 3. Foster teamwork, i.e. close coordination, camaraderie, and understanding among departments. 4. Be consistent, not conflicting, in your communications, because consistency in the messaging creates awareness, reinforces the message, and helps build the brand, while conflicting messages confuse and ultimately scare away customers. 5. Institue regular cross-functional meetings, i.e. involving not only all department heads in the IMC efforts, but also fostering interdepartmental communication to ensure that each group is doing its part according to the plan or to identify unexpected problems. 6. Provide training to employees so that they learn to work in concert with each other. 7. Monitor results across the media. 8. Rethink compensation, meaning that since IMC focuses on delivering results across the organization, incentive programs should be linked to achieving the organizational goals, not merely the individual or department objectives. IMC in Practice Case Histories

Dow Chemical Company In a report on IMC produced by the American Productivity Quality Center (McGoon 1999), Dow Chemical Company emerged as a best-practice implementor of IMC. Advertising specialists have found that Web sites are an important part of a firms overall IMC strategy. Dow Chemical Company has developed an attractive Web site with links to its customers, public relations activities, press releases, executive speeches and extensive product information. These features of Dow Chemical Companys Web site enhance the effectiveness of the components of Dows promotional mix. Within the scope of the present marketing exercise the following will look at a selected subset of the Dow Web site in an effort to understand how it maximizes the impact of the companys promotional mix, i.e. IMC program. This subset includes the following components of the companys Web site: company information, help and feedback, corporate responsibility, charitable contributions, executive speeches, press kit, and career opportunities.

Ibid, Skolnik.

The button About Dow brings the customer to a page that summarizes the most important information on the company, its products, and its commitment to sustainable development.
Dow is a leading science and technology company that provides innovative chemical, plastic and agricultural products and services to many essential consumer markets. With annual sales of $28 billion, Dow serves customers in more than 170 countries and a wide range of markets that are vital to human progress, including food, transportation, health and medicine, personal and home care, and building and construction, among others. Committed to the principles of Sustainable Development, Dow and its approximately 50,000 employees seek to balance economic, environmental and social responsibilities. Dow people around the world develop solutions for society based on Dow's inherent strength in science and technology. For over a decade, we have embraced and advocated Responsible Care - a voluntary industry-wide commitment to safely handle our chem icals from inception in the laboratory to ultimate disposal. This worldwide commitment helps consumers lead better lives, customers succeed, stockholders prosper, employees achieve and communities thrive.

The Help and Feedback link brings users to a Web page that provides them with links and information to help them find answers to basic questions, locate a specific Dow facility, request product information, or provide opinions about dow.com and suggestions for improving the companys Web site. For example , to locate product information customers have three options: a) find detailed information about Dow Products and Services by Industry, Product Name or Category, b) use the Search function, and find the information by entering keywords and phrases, or c) v the companys Customer Information Group, which is staffed to ia provide quick and accurate answers to technical product questions. The Help and Feedback page also provides links to other informational pages. These are Our Locations, which presents background information and directions for the firms plants and facilities worldwide, Joint Ventures & Subsidiaries, which links the customer to information on Dows joint ventures, subsidiaries or partly owned companies, and Send an email to The Dow Chemical Company. The button Corporate Responsibility is a link to a further page that extends on the companys commitment to sustainable development, which includes the areas of economic prosperity, corporate social responsibility, and environmental stewardship.
We are part of an ever -evolving global society one that values organizations such as Dow not only for our products and services, but also for the distinctive contributions we make to our world and its people. For Dow, these contributions are most visible i the consumer markets we serve. These include: food; building maintenance and n construction; transportation; furniture and furnishings; paper and publishing; home care and improvement; personal and household care; health and medicine; water purification; electronics and entertainment. However, our contributions must extend beyond product performance. We strongly believe that if we are to be successful in the 21st Century, we must simultaneously excel in all three elements of sustainable development: economic prosperity, corporate social responsibility and environmental stewardship. We are learning to make sustainability a way of business at Dow. While we continue to learn, we are making progress. Cornerstones of the Dow sustainability strategy are our eight Sustainable Development Guiding Principles. Adopted in February 2000 these principles guide our behavior and our decision-making. Setting corporate targets and reporting openly and rigorously against them is also part of our strategy, validating the clich that "What gets measured gets done." Since 1999, we have published an annual Public Report helping you to track our progress.

The Speeches section of the Web site is a comprehensive archive of speeches and reports by top management executives. Particularly interesting is the fact that for the most part these speeches deal with a technical issue that is set in relation to customer needs and any one of the areas of sustainable development to which Dow is committed. In the Press Kit part of the Web site, Dow invites the Web site users (here, reporters and journalists) to explore and find the tools needed to effectively communicate about The Dow Chemical Company. The press kit consists of general company information, as well as corporate logos and usage guidelines. The Feature Story Archive is a comprehensive set of past stories in the firms series that highlight Dow's commitment to Living. The latest stories on charitable contributions are:

September 4, 2002

July 10, 2002

June 25, 2002

Dow Experimental Cancer Treatments Can Ease Pain and Improve Effectiveness

OPTIM* Glycerine Helps the Medicine Go Down

How Dow Automotive Helps People Drive Safely & Comfortably

Finally, Dows Web site section on Careers @ Dow also communicates the message that all previous sections transport to the sites visitors.
At Dow, we're focused on people from our passion to improve daily living to our drive to create a workplace where every person can reach his or her full potential. As a leading global company in full motion, we offer opportunities worldwide. And our work environment gives you the freedom to explore and make the most of them. Explore this site to learn why a career at Dow might just be your pathway to succes s. Join Dow and become part of a culture of excellence and social responsibility. You won't be just working for a living; you'll be part of a global team that's focused on making a difference in the everyday lives of people.

As the preceding excerpts from several sections of Dows Web site show, the message across all of them is the same: Dows commitment to excellency of products and services, customer satisfaction, and improving daily living through sustainable development. It is this consistency in communicating with the firms internal and external stakeholders that contributes to the effectiveness of Dows IMC program. Other Interesting Case Histories6 Levi Strauss & Co. Levi Strauss is also a very good example of a marketer that managed to integrate its business activities to offer customers a product that fits them one-to-one. In the past, Levis was known as the sportswear marketer that produced the high quality jeans for the masses, the first product being the Levis 501 for both men and women. Today, Levis past marketing strategy is contrasted with the new Levis Original Spin jeans. Customers go to a Levis store and choose from three basic jeans styles, five types of leg opening, two flies, as well as ten combinations of fabrics and colors. Then, a salesperson measures the customers waist, seat and inseam, and a pair of jeans is made to the customers specifications. The customer can pick up his/her set of jeans at the store or have it sent to his/her home for a small delivery fee. After this first in-store purchase, customers can then order additional customized jeans either by phone or online. As an integrated marketer, Levis not only recognizes customers need/want for a custom-made pair of jeans, it also can match up easily to the customers specifications and purchasing history, by having achieved a level of company department integration that enables it to do so. And this service is consistent with the message that the company delivers through its TV advertising and Web site. Greyrock Capital (now part of the Bank of America) Greyrocks service involves lending money to technology start-ups and other entrepreneurial companies. Since high-tech companies are often beyond the comprehension and guidelines of traditional lenders, Greyrocks goal was to emphasize that it is one of the few, if not the only lender that understands such
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Ibid, Skolnik.

businesses and their financial needs. Thus, Greyrock turned to Alliance Marketing Group (AMG), an integrated marketing services firm to develop a completely integrated marketing program for Greyrock. Based on the slogan We get it the program that AMG developed integrated print advertising, direct mail, sales, and a Web site. According to AMGs CEO Bob Zappi, The marketing communications program was designed to capitalize on the strength of each medium used. All elements work together to achieve superior and costeffective results. The new integrated marketing communications campaign of Greyrock began approximately three years ago. Today, Greyrock is part of Bank of America, yet it continues using the campaign because it is working well. Proof of this is an increased number of accounts. When the campaign started, Greyrock was doing business with 14 companies. Now, that number has now tripled. Cisco Systems Cisco markets Internet networking products such as routers, switches, dial-up access servers, and network management software. Configuring a customers system is a complex process that tends to occupy sales and support personnel for weeks at a time. To improve the quality and timeliness of its customer service Cisco introduced this configuration software tool in its Web site, thus making the process both faster and more accurate. Now, customers can search for the software that they need to configure their systems by product family, description, or number. They can then select items in the appropriate categories, adding to the configuration and adjusting quantities as desired or needed. They can save their configuration results, view the product summary, including prices, submit the order, and finally download their end choices to their own systems. According to Cisco, the whole process can be completed in as little as fifteen minutes. This saves time and cuts transaction costs, but it also ensures that no customer ever has to re-enter configuration information. By integrating multiple processes and disciplines, the site now facilitates several billion dollars worth of transactions annually, while reducing several hundred million dollars worth of servicing costs. It also strengthens relationships with customers and reduces their propensity to defect. Thus, Cisco is also a good example of a multinational company who achieved integration in its processes to serve the real needs of its customers in a way that is consistent within the company and in terms of its presentation towards the outside.

Conclusion Today, many companies still rely on one or two communication tools to achieve their communication and marketing aims. This practice persists despite the fragmenting of mass markets into a myriad of minimarkets, each requiring its own approach, inspite of the proliferation of new types of media, and despite the growing sophistication of consumers. Yet the wide range of communication tools, messages, and audiences makes it possible and imperative that companies move toward IMC in an effort to enhance CRM strategies and consequently, competitive advantages. The most obvious benefit of IMC is that it helps produce stronger message consistency and consequently, greater sales impact. It gives someone responsibility where none existed before to unify the companys brand images and messages as they come through thousands of company activities. Thus, IMC improves the companys ability to reach the right customers with the right messages at the right time and in the right place.7 As the practical examples described in the previous discussion clearly show, IMC is a way of looking at the marketing process in its entirety instead of focusing only on individual parts of it.

Ibid, Kotler.

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