INTEGRATED MARKETING COMMUNICATIONS:
THE CASE OF HSBC AND W/W ELECTRONICS LIMITED
Concept
Integrated marketing communications is a strategy utilized by a company by coordinating “advertising, sales promotion, personal selling, and publicity in order to present a single consistent image for the product and the company” (2005). The concept also refers to the process of unifying all the promotional activities of a company “to deliver a consistent and positive message” because of the recognition that all the possible contact points of the company with customers is significant starting from the person at the reception desk to the chief executive officer. ( 2005)
Every company that wants to maximize all the channels of communication with customers should utilize its resources to develop a single integrated message to be communicated by all the members of the organization to the areas of the market that they reach. Next to the message, the manner of communications and the people identified as recipients of the message, and the purpose of the message should be identified. Thus "All Marketing Communications should be 1) clearly positioned, 2) directed to a particular target market, 3) created to achieve a specific objective and 4) undertaken to accomplish the objective within budget constraints (2003)".
Benefits of Integrated Marketing Communications
Utilizing integrated marketing communications have several benefits, which are corporate cohesion, client relationship, interaction, motivation and participation (1999). Corporate cohesion refers to internal unification of the efforts of the company and the external communication by the all members of the organization to the target market. When all the members of the organization are aware of the message that the company wants to convey to the public and the objectives attached to the message then all members of the organization are united by the company objective and the message being sent. When the company is united on the message to be communicated to the public then the unified efforts are magnified because of the single message that organization members are all communicating.
The communication of a single, clear message by the members of the company results to the development of client relationships that serve as the competitive advantage of the company. Customers are better able to remember a company, brand or product if they receive a consistent message from the organization through the different channels of communication. HSBC is a company that communicates the message that it is the world’s local bank. This company gives the message that it is an international company but despite its global operations, the company has a firm hold on local communities, because it takes time to know the specific needs of every market. Employees adjust to the circumstances of their customers. Transactions through the teller involve conversations in the language that the client is most comfortable and in a manner that respects the beliefs and practices of the domestic market. The same message is conveyed through television advertisements.
Integrated marketing communications provides an organizational atmosphere conducive to the free flow of communications. The exchange of ideas ensures that creative and logical ideas are contributed and the development of a message, the identification of the approach and strategy of communication, and the system of accomplishing the project constitute the best plan for the company.
Integrated marketing communications motivates the members of the organization. When a group of people in-charge of the different areas of marketing is involved in the process of developing an integrated marketing communications plan, creative and analytical ideas are exhausted resulting to an excellent plan created by a team of experts. Sending a single message also motivates the members of the organization because everybody starting from the people in the reception area to the delivery personnel and up to the managers are made to think of ways of communicating the message through their tasks. Since HSBC claims to know the needs of the local market then the tellers should know the acceptable manner of making transactions and negotiations in the local branch.
The result of the utilization of integrated marketing communications is a plan attributable to all the divisions of the organization. There is no internal politics because everybody contributed to the plan and its implementation and everybody takes responsibility for the result of the plan.
Developing a Single Organization Message
A single organization message means that the company communicates a uniform message in all the channels of communication that the company is utilizing for a brand, product, service or company name. This does not mean that the company chooses to send a single message through a particular channel only. HSBC is a company that communicates a clear message for the type of service that the company offers to domestic markets in different countries. It does not market a particular service, only the mastery of the local market that the company stands for. Wiseworld Electronics Limited on the other hand is a company based in Hong Kong engaged in the trade of electronic products of Samsung and Fairchild Semiconductors. The company communicates the message that the company retails quality electronics products at a wholesale price. The company does not manufacture and produce products of its own but it sells the quality brands Samsung and Fairchild. This means that the success of the company’s marketing communications plan depends in part upon the brand equity of the products it sells. Despite the difference in characteristics, both companies have identified the message that they want to convey to the public.
Positioning of Integrated Marketing Communications
The marketing mix helps organizations develop an integrated marketing communications plan based on the consideration of product, price, place and promotion (1999). These factors should also be integrated in the plan and implementation of the marketing communications strategy of an organization. ( 2004) This is because a plan will not work if the message delivery is not appropriate in terms of the product being marketed, the price relative to the claims of the company, the environment where communication was made, and channels of communication used by the company. There should be consistency between the message and the marketing mix of the company and correct positioning of the marketing communications.
HSBC markets a service, so the company should makes sure that the message covers the service it offers. The company cannot claim to the public that it is the world’s local bank if its services are limited only to the cities in the different countries. Wiseworld Electronics cannot claim to sell quality electronics products if it markets products that are not known or known to be of only average or fair quality. Both companies should also weigh the price they designate in the message relative to the actual service or product received by customers. The plan will not work for HSBC if it has branches in both rural and urban areas but it imposes an excessive interest rate for loans that locals cannot afford the service. W/W Electronics will also fail to attract customers if it sells Samsung and Fairchild products at a higher price than other retailers do and it does not update its stocks to include new versions of the products it sells.
There are three areas of coordination that the company should consider in the planning and implementation of its marketing communications. These areas are brand essence, target market and the persuasion tools used to link the communication of the brand essence to the target market. (1996) In terms of brand essence, it is important that the company have a comprehensive idea of the brand marketed and the equity of these products. Brand involves tangible and intangible qualities. Tangible aspects of the brand include the visual design of the logo or symbol attached to a product or service or it is the physical appearance, packaging and warranties of a product or service. HSBC use the following name and logo to represent the services of the company.
Wiseworld Electronics Limited does not have a logo but it communicates the company message through its name and address in company listings and in the list of authorized distributors of Samsung and Fairchild.
Despite the difference in the tangible brand equity of the companies both have intangible brand essence attached to their names. HSBC is known to be present in every corner of Hong Kong and in other countries. It offers finance and banking services and serve customers based on the needs of the locality. Wiseworld Electronics Limited on the other hand was able to create a network in the market through their established retail contacts and agents in Hong Kong because the market of the company includes primarily retail stores, companies that use semiconductors in their products and a certain percentage comprising of households.
Integrated Marketing Communications Directed at a Target Market
The target market is the second area of coordination. Identifying the target market is important because this addresses the question to whom will the company send the message. Determination of the target market requires research on the best prospects for the message and the segments of the market that can influence other consumers or the audiences of the channels of communication. The best segment of the market for HSBC depends upon the services it offers. Loans and credit cards are for working single and married individuals who need to purchase houses, cars and even smaller purchases such as weekly groceries. Insurance are marketed to car and house owners, employees wanting to receive pension after retiring and businesses seeking insurance coverage for the different aspects of their operations. Wiseworld Electronics Limited targets businesses that use semiconductors or electronic products in their production, retailers and households who purchase directly from the company.
There are also various influencers of the target population. HSBC has business partners in the areas providing a complementary service to its own. Businesses selling cars or real estate agents may recommend HSBC in case their clients want to obtain insurance for their vehicle and car purchases. Wiseworld Electronics may be recommended by long time customers, comprising of businesses, to other businesses requiring the products that Wiseworld Electronics trade. Hong Kong provides an environment for the development of strong and reliable business networks.
Audiences of the channels of distribution comprise the recipients of the message sent through the different channels of distribution. Apart from the recommendations of entities not part of the company, HSBC and Wiseworld Electronics also utilize other channels of communication such as advertising, personal sales and other persuasion tools. Although companies may have a target audience, the message may reach other segments of the population. HSBC commercials viewed in televisions and print media advertisements are seen by any person in the world. Wiseworld Electronics on the other hand have a smaller market reach because of the scale of its operation but nevertheless it’s the name of the company is part of the list of authorized distributors of the website of Samsung and Fairchild which means that the people in Hong Kong wanting to purchase products from Samsung and Fairchild are informed of the dealers they can contact in Hong Kong.
Objectives of the Marketing Communications
The third area of cooperation is the consideration of the tools of persuasion to be used in communicating the message. The tools used should be appropriate to the message and the target market. There are five main areas of persuasive tools: 1) public relations; 2) direct marketing; 3) promotions; 4) packaging and 5) advertising. The task of the marketer is to effectively communicate the essence of the company, brand, product or service being marketed. Essence that will be communicated refers to that deemed most important to the target audience.
The actual sending of messages happens through the different persuasion interfaces. Consumers receive the message when they are faced with actual selling messages containing words and pictures in television commercials, billboards, store promotions and other places. Target market also receives the message through trials or actual consumption. A customer of HSBC and Wiseworld Electronics will come back and make another purchase after experiencing becoming satisfied with the services of HSBC and using the products traded by Wiseworld Electronics. Customers also receive a message through the different channels but the message may be different from the actual message on the company, brand, product or service. The association may be an emotion, celebrity, learning or other ways of association. Customers encounter the message through the point-of-purchase information given by sales agents.
Marketing Communications and Budget Constraint
Different companies have different financial capabilities for marketing communications. HSBC is a multinational company with resources for a marketing communications plan integrating the different channels of communication. Wiseworld Electronics is a distribution company for Korean electronics products to different companies in Hong Kong and in Asian countries without sufficient resources for a marketing communications plan targeting a global market. The nature of the business of the companies also determines the marketing communications plan appropriate to the company. HSBC targets households and employees so the marketing plan of the company is to reach out to as many households and employees as possible. Thus, the company invested in an advertising campaign shown in different international channels as well as billboards and print media advertisements. Wiseworld Electronics need to reach out to other businesses using the products it trades and to retailers. Thus the company has developed a wide spread network among companies in Hong Kong and in other Asian countries through personal business deals that the company pulled through to the satisfaction of its buyers. The approach of Wiseworld Electronics is more personal when compared to the indirect marketing communications approach of HSBC because of the difference in the circumstances of the companies. The success of these companies lies in their ability to maximize available resources in integrating all appropriate areas of marketing communications to send persuasive messages to their target markets.
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