Bachelor's thesis. International Business. Management. Tähkäpää Matti CITY-INFO BOARDS. A new marketing communications tool - PDF

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Bachelor's thesis International Business Management 2012 Tähkäpää Matti CITY-INFO BOARDS A new marketing communications tool BACHELOR S THESIS ABSTRACT TURKU UNIVERSITY OF APPLIED SCIENCES International

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Bachelor's thesis International Business Management 2012 Tähkäpää Matti CITY-INFO BOARDS A new marketing communications tool BACHELOR S THESIS ABSTRACT TURKU UNIVERSITY OF APPLIED SCIENCES International Business Management Laura Heinonen Matti Tähkäpää CITYINFO BOARDS A NEW MARKETING COMMUNICATIONS TOOL New CityInfo boards were introduced in December This project was executed in cooperation with City of Turku and Veikkaus. The objective of this pilot project was to clean up the cityscape as well as support the local sports and culture organizations that are organizing events in Turku. CityInfo boards are divided into three sections; top of the is reserved for welcome greeting of Turku, right side of the board has the logo of Veikkaus, and the left side has electronic screen with changing event advertisements. Outdoor advertising is a challenging media; although it reaches great masses and has superior CPM (cost per thousand) there are also disadvantages such as waste coverage and limited message capabilities. Because of these challenges the use of outdoor advertising should be part of broader marketing communications plan. With thorough planning communication mix the disadvantages of outdoor advertising are controllable. The research studies the characteristics and usage of the boards from both advertisers and consumers point of view. The perception of the consumers was studied with quantitative research. Responders were asked to evaluate the attributes and objectives of the boards with simple questionnaire. The experiences of the advertisers were researched with qualitative methods. The research indicated that the basic concept of the CityInfo boards was generally good. However, the idea should be further developed to better meet the expectations of the consumers and advertisers. The service could be expanded to CityInfo website where people could be able to check the advertisements they had quickly seen when passing by the boards. That would make the message more memorable and easy to find. KEYWORDS: Outdoor advertising, marketing, marketing communications, CityInfo OPINNÄYTETYÖ (AMK) TIIVISTELMÄ TURUN AMMATTIKORKEAKOULU International Business Management Laura Heinonen Matti Tähkäpää CITYINFO TAULUT UUSI MARKKINOINTIVIESTINNÄN VÄLINE Uudet CityInfo taulut esiteltiin yleisölle joulukuussa Projekti on toteutettu yhteistyössä Turun kaupungin ja Veikkauksen kanssa. Tämän pilotti projektin tavoite oli siistiä katukuvaa kuin myös tukea turkulaisia kulttuuri- ja urheilujärjestöjä, jotka järjestävät tapahtumia Turussa. CityInfo taulut on jaettu kolmeen osaan; yläosa on varattu kaupungin tervetuliaistoivotukselle, oikealla puolella on Veikkauksen logo ja vasemmalla puolella elektroninen näyttö jossa on vaihtuvia tapahtumamainoksia. Ulkomainonta on haastava media; vaikka sillä tavoittaa suuria massoja ja sillä on ylivoimainen CPM (hinta tuhatta kontaktia kohti), on sillä myös huonoja puolia kuten hukka näkyvyys ja viestin rajallisuus. Näiden haasteiden vuoksi ulkomainonnan käyttö tulisi aina olla osana laajempaa markkinointiviestinnän suunnitelmaa. Huolellisella viestintä mixin suunnittelulla ulkomainonnan huonot puolet ovat kontrolloitavissa. Tutkimus selvittää taulujen ominaisuuksia ja käyttöä niin kuluttajien kuin mainostajienkin näkökulmasta. Kansan käsitystä tauluista tutkittiin määrällisillä menetelmillä. Vastaajia pyydettiin arvioimaan taulun ominaisuuksia ja tavoitteiden toteutumista yksinkertaisen kyselyn avulla. Mainostajien kokemuksia tutkittiin laadullisten menetelmien avulla haastattelemalla joitakin heistä. Tutkimus osoitti, että CityInfo taulujen perusidea on hyvä. Palvelua tulisi kuitenkin vielä kehittää jotta se vastaisi paremmin niin mainostajien kuin kuluttajienkin odotuksia. Palvelua voitaisiin laajentaa CityInfon kotisivuille, josta ihmiset voisivat käydä tarkistamassa mainokset jotka he pikaisesti näkivät ohittaessaan tauluja. Tämä parantaisi viestin muistettavuutta ja helpottaisi tiedonhankintaa. ASIASANAT: Ulkomainonta, markkinointi, markkinointiviestintä, CityInfo CONTENT 1 INTRODUCTION 5 2 MARKETING Marketing Process Marketing Mix Services Marketing 9 3 MARKETING COMMUNICATIONS Planning of Marketing Communications Communication Mix 11 4 ADVERTISING Outdoor Advertising Effects of Advertising Succesful Advertising 16 5 RESEARCH METHODS Background and Scheme of the Report Research Methods, Data Collection and analysis 18 6 ADVERTISERS City of Turku Veikkaus Culture and Sports Organizations 21 7 RESEARCH Responder Demography (Use of CityInfo Boards Content of CityInfo Boards Attributes of CityInfo Boards 28 8 USER RESEARCH 29 9 CONCLUSIONS 32 SOURCE MATERIAL 36 APPENDICES Appendix 1. Questionnaire and the results 1 INTRODUCTION I was asked to study the project executed in cooperation by City of Turku and a betting company Veikkaus Oy. In 2009 the new City-Info billboards were introduced with an objective to support both image and marketing of culture and sports in Turku area. For Veikkaus the objective was to reinforce its importance in people s lives in Finnish society. Veikkaus returns over one million Euros every day for art production, constructions of sport areas and supporting both distraction of the young and the scientific research (Meetingteam Oy, 2009). This said it has been an interesting to study a little different approach to outdoor advertising. City-Info boards are marketing tool for for-profit organization Veikkaus, for non-profit event organizers as well as for municipality. In the first part of thesis I will go through the basic theory of marketing and marketing mix, then narrowing it down to marketing communication and communication mix, and finally to advertising, advertising mix and especially outdoor advertising, the areas City-Info boards are really about. The research was conducted as a quantitative questionnaire. Originally the link to online questionnaire was planned to be on the City-Info boards as well as at the website, which is Turku s website that provides organization s a chance to provide information of their events for free. However, later on people were reached from other Turku websites as wells as by . The research also included qualitative questionnaire to the event organizers. Only five of them responded, but from a very different kinds of sports and culture organizations. In the second part I will present the findings of the research. The questionnaire itself was based on the theory of marketing and advertising as well as on the objectives of Veikkaus and City of Turku. Mainly the feedback was quite positive, but there was also a need to further develop the service, especially from the organizers point of view. The results point out some of the same problems than traditional outdoor advertising. The questionnaire also included 6 an open question for feedback. I have included some of the comments from the responders among the results. I have used quite a few diagrams and charts to demonstrate the results. In the last part in will write about my conclusions of the research. As this was a pilot project of Veikkaus I will be presenting suggestions how to further develop the service based on the outcome of the research. In appendices there are all the results of the questionnaire. 7 2 MARKETING Many people would say marketing is just selling and advertising your product or service. However, nowadays it s more than that. Today, marketing should be understood as satisfying customer needs. Marketers should understand customer needs and then develop products that that provide superior customer value. Products price, distribution and promotion should be set so that the product itself sells easily and would not be dependent on the traditional selling. In other words, today the objective of marketing is to make selling unnecessary. Kotler and Armstrong (2010, 29) define marketing as follows: The process by which companies create value for customers and build strong customer relationship in order to capture value from customers in return. 2.1 Marketing Process Kotler and Armstrong (2010, 29) suggests that marketing process model has five steps; understanding the marketplace and customer needs and wants; design a customer-driven marketing strategy; construct and integrated marketing program that delivers superior value; build profitable relationships and create customer delight; and capture value from customers to create profits and customer equity. The basic human needs are for example physical needs such as needs for food, warmth and safety, social needs are belonging and affection, and individual needs are knowledge and self-expression basic part of the human makeup. Wants are needs that are shaped by culture and individual personality. For example person in Sweden needs food, but wants meatballs. When these wants are packed by buying power they become demands. Companies should aim to fulfill these needs and wants through market offering. Marketing should always be customer oriented. However, too often sellers pay more attention to product the company is offering than to the benefits and experiences these products offer. Marketers greatest challenges are to create customer value and satisfaction, because dissatisfied customer is often a lost customer. Marketing occurs when people satisfy their wants through exchange relationships and 8 marketing should consist of actions to build this relationship. (Kotler and Armstrong, 2010, 30-31) 2.2 Marketing Mix Marketing mix, also known as Four Ps (product, price, place and promotion), is a set of controllable tactical marketing tools the company uses to gain the wanted response from the market (Kotler and Armstrong, 2010, 76). As presented in the first chapter the world of marketing has changed and today marketing is about satisfying customer needs. Traditional Four Ps model tend to look the marketing mix from the sellers point of view. Often marketers are selling a product, but customers think they are buying value or solution to their problem. That s why Four Cs might be considered a good way to think the marketing mix. Four Cs stand for Customer solution, Customer cost, Convenience and Communication (Kotler and Armstrong, 2012, 77) Marketing mix proves that when customer buys a product it s just not the end product he or she buys. Successful marketers have to think their product or service from various perspectives. Looking into the soul of 4ps, the product itself must be more than the sum of its parts. Things that bring value to the product are variety, quality, design, features, brand name, packaging and services. Another tool of marketing mix is price; list price, discounts, allowances, payment periods and credit terms are things to consider. Placing is making the products available for your target customers. A marketer needs to think channels, coverage, assortments, locations, inventory, transportation and logistics. (Kotler and Armstrong, 2010, 76) Promotion is the one from the Four Ps that is important if you think of City-Info boards. Promotion includes advertising, personal selling, sales promotion and public relations. Promotion is about communicating the merits of the product and persuade target customers to buy it (Kotler and Armstrong, 2010, 76). 9 2.3 Services Marketing The chapters above have been describing the marketing of a tangible product. However, in a case of City-Info boards none of the parties is promoting a tangible product, but a service. However, services are products as well and same rules apply, although services marketing have its own characteristics (Kotler and Armstrong, 2010, 268). Basic characteristic for services are that they are intangible, thus services cannot be seen, tasted, felt, heard, or smelled before purchase. Variety of services is dependent on who is providing it as well as when it is provided, where, and who is providing the service. Services are also inseparable, in other words services are produced and consumed at the same time. Thus, services are perishable and cannot be stored for later sale and use. (Kotler and Armstrong, 2010, 269) 3 MARKETING COMMUNICATIONS Marketing communication is the process of effectively communicating product information or ideas to target audience. (Burnett and Moriarty, 1998, 3) The objectives of marketing communications are to create brand awareness, deliver information, educate the market, and advance a positive image for the brand or organization. Its goal is to help sell the product and making profit so the organization can keep up in the future as well. One of the most important things is to coordinate the message so that it reaches the target audience. However, many of the contacts to customers are unplanned, informal messages. For example bad customer service tells customers that the organization doesn t care. Thus, organization needs to think all the possible contact points to customers to successfully execute marketing communication. (Burnett and Moriarty, 1998, 4-5) 10 Planned messages of the marketing communication include activities such as advertising, sales promotion, public relations, direct marketing, personal selling, point-of-purchase, packaging, specialties, sponsorships, licensing and customer service (Burnett and Moriarty, 1998, 9). Smith (2000, 7) suggests that internet, word of mouth and corporate identity should be on the list as well. The most important source regarding this research about City-Info boards is advertising. Advertising is understood as any paid form of communication by an organization promoting ideas, goods or services. Advertising is usually targeted to large groups and thus mass media such as radio, television and newspaper is used (Burnett and Moriarty, 1998, 9) Unplanned messages include all other contact points with customer, they are usually harder to control but ideally planned and unplanned messages should work together and give unified image of the organization. The main sources of unplanned messages can be employee behavior, facilities, transportation, response services, crisis management, and media and government investigations. (Burnett and Moriarty, 1998, 8-9) 3.1 Planning of Marketing Communications Vuokko (2002, 132) points out that marketing communication plan should always be based on organization s marketing plan, which should be based on organization s strategy This way organization s vision, idea and values are communicated through its marketing and marketing communications. She continues that marketing communications can be planned on the organizational level, campaign level or on the level of single communication tool. However, these different levels should be linked to each other to show unified image. Despite of the differences on different levels there are certain stages that can be recognized in the planning process; identifying threats and opportunities, defining goals, defining target audience, creating a budget, choosing a proper communication mix, making special decisions on every communication tool, considering execution of the plan, and finally define tools for measuring the success of the marketing communications. (Vuokko, 2002, ) 11 Smith (2000, 32) suggests SOSTAC planning system for marketing communications. SOSTAC stands for situation analysis, objectives, strategy, tactics, action and control. Its simple structure should be applicable on all levels of marketing communication. He further points out that every plan must include resources required. He suggests the 3Ms model; men, money and minutes. Men means human resources, basically who needs to do what. Money is about budget and how much money is put on marketing communication to reach its objective. Last but not least is Minutes - the scarcest resource time. The time scale is the fundamental to make marketing communication successful. (Smith, 2000, 32-33) 3.2 Communication Mix Communication mix, sometimes referred as promotional mix, lists all the tools of communication. Communications tools are selling, advertising, sales promotion, direct marketing, publicity and public relations, sponsorship, exhibitions, packaging, point-of-sale and merchandising, internet, word of mouth and corporate identity. Different industries have different emphasis on what communication tools they would use. Mixing these communication tools is dependent on the objectives of the marketing communication strategy. Brand awareness can be build with advertising and PR, whereas brand switching would require integrated sales promotion and advertising or direct mail. Sometimes different communication tools can be used in different stages which a customer moves before when making a purchase decision. (Smith, 2000, 7-11) There is also another way of categorizing marketing communication tools. You may differentiate then between theme or image communication and action communication. Image communication s objective is to tell the target audience about the brand or products and service offered. This is aiming to improve relations with target audience or reinforce brand awareness and preference. In long run this will eventually give positive results, thus people would purchase the advertised product or service. Theme communications are also known as above-the-line communications. This is usually synonymous to mass media 12 advertising, such as television, radio, magazines, newspapers, cinema and billboards. Action communications try to persuade target audience to purchase the product. (De Pelsmacker et al, 2007, 7) 4 ADVERTISING Advertising is part of the promotion mix described in an earlier chapter. The definition is that advertising is any paid form of nonpersonal communication about an organization, product, service, or idea by an identified sponsor (Belch and Belch, 2001, 15). Generally the space of time for advertisement must be bought and a large group of individuals is reached with mass media. Burnett and Moriarty (1998, ) list five common advertising media; print advertising on newspapers, magazines, brochures, and flyers; broadcast advertising on either TV or radio; out-of-home advertising that reaches audiences in their daily environment such as painted walls, truck displays, bus benches, shopping centre displays, in-store merchandising, and billboard advertising; transit advertising such as buses and taxis carrying a message throughout the community; online or internet advertising on websites. In Finland, according to Vuokko (2002, 200), firms spent 1,1 billion Euros on advertising in Printed media was the most popular as 73 % of the money was spent on it as showed on diagram 1. Broadcast advertising was next with 22 % share. Only 3 % was spent on outdoor marketing. 13 Advertising 2001 Printed advertising Broadcast advertising Out-of-home advertising Online or internet advertising Diagram 1. The share between different advertising media in Finland in Ten years later the share of advertising on printed media has decreased tremendously. However, it s still over half of the 1,4 billion pot with 56,5 % share (diagram 2). Broadcast advertising has remained almost the same with 24,5 % share. The big winner has been online advertising which has increased to challenge the broadcast advertising with 15,8 % share. Outdoor advertising has kept its position with 3% share. (Honkaniemi, 2012) Advertising 2011 Printed advertising Broadcast advertising Out-of-home advertising Online or internet marketing Diagram 2. The share of advertising media in Finland in 2011. Outdoor advertising Outdoor advertising, as well as rest of the out-of-home media, is considered as support media because it reaches large audiences. Support medias objective is to reach those not reached by primary media or to reinforce and support the message (Belch and Belch, 2001, 438). The advantages of outdoor advertising are flexibility, high repeat, exposure, low cost, low message competition and good positional selectivity.
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