Integrated Marketing — Marketing magazine

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These days it’s the ‘in’ thing to do

INTEGRATED MARKETING

by Paula Terry

View in Context

‘Integrated marketing’ is one of the latest catchphrases to scourge an industry which loves a novelty.  But what exactly does it mean?

Currently it’s lacking an industry-endorsed definition – at least a consistent one – and different practitioners and clients offer different opinions and benefits.

So who are the people claiming to be ‘integrated marketers’?  How do they explain their various products and what do they consider their true point of difference?

Professor Peter Zarry, former president of Spitzer Mills and Bates, Toronto, and now director of the executive development program at York University in Toronto, explains the genesis of the IM approach this way:

The ‘big bang’ for IM came as television became increasingly fragmented during the last decade.  With the advent of cable, TV was no longer an affordable way for many marketers to reach their targets effectively.

So clients looked for alternative ways to communicate their messages, and thus ‘the constant search for more effective use of the dollar began,’ says Zarry.  This invariably meant using each element of the marketing mix to support the others, and using multi-media rather than simply the tried-and-previously-trusted conventional above-the-line vehicles.

However, the specific way a client goes about obtaining ‘more effective’ use of his communications budget depends to a large extent upon the philosophy of his communications teammate.  And all the players in the IM game have principal differences.

Amid much diversity, though, there appear to be constant and common elements which form the backbone of the IM concept.

It’s the application of the concept that lends itself to multiple interpretations.  All companies who practise IM – and many of them decline to call themselves ‘agencies’ because of the word’s historically restrictive role – agree on certain fundamental tenets.

  • Firstly, there must be a consistency of message between all elements of the marketing mix – a common projection of synergy from all communications standpoints.  ‘It sounds so obvious, but in practice it very seldom happens to the extent that it could or should,’ says Zarry.
  • Secondly, IM works only when a client’s communications problems are viewed from a holistic stance, and an overall coordinated effort is made to provide solutions.

Apart from these two cost-of-entry criteria, however, differences in approach abound.

Differences in approach

Everett Elting, president and chief executive officer of Grey Advertising, Toronto, feels what sets his agency network apart from other comparable-sized shops is the reporting structure within all the various operations.

‘What makes us unique among other major agencies is that all the divisions of Grey in Canada report to me.  We don’t have the head of Grey Direct here reporting to the head of Direct in New York, of the head of public relations reporting to the head of PR in New York, which is common practice among other multi-nationals.

‘And as they all report to Grey Canada, they’re all working together – that’s where it’s truly integrated, because there’s no competitive alignment of the various operations.

‘That’s critical to our client, because when they say: “Here’s half a million dollars.  How would you spend it?” they can get sound, objective recommendations.  We don’t say “Let’s put it into above-the-line media” because that’s the business we’re in.  We can put it across the whole spectrum and can be truly integrated in our approach to the best solution because there are no vested interests.

‘All our divisions are part of the same organization.  That’s what we mean by IM – it’s all part of one operation.’

Ted Matthews, president of Promanad Communications, Mississauga, Ont., a full-service communications company which has grown from $10 million six years ago to current billings of $25 million, takes a different view.

He believes true integration can come only when a single agency team is responsible for the whole gamut of a client’s activity.

‘Even within a full-service agency, the ‘division’ structure means that when a client gets pitched he has, say, two account people, two creative teams, and you’re right back where you started – there’s no advantage because your problem is subject to the same old distinct interpretations,’ says Matthews, adding: ‘Let’s face it – no two creative people have ever agreed on the same solution, and just because they’re all under the same umbrella technically doesn’t mean they’re going to start.’

‘At Promanad, we have multi-disciplines within the marketing mix represented by one account team, one creative team – all working together within a multi-faceted framework.’

Could this be interpreted as a disadvantage – the fact that by definition those people are generalists rather than specialists?

Says Matthews: ‘Well, if today you could just reach your target with TV, then I’d go to the guy with twenty years’ TV experience, yes.  But as the ability of any single component to reach a target has dwindled, and the need for a mix of vehicles has arisen, you need to hit people at different times and in different places to get sufficient reach and frequency with them.

‘You therefore require, in this age, a multi-disciplined approach to communication.  There’s far more strength in bringing in a team that can put together a range of disciplines, while working as a completely self-supporting and single unit, to make one and one equal three in terms of efficiency and effectiveness.’

ZARRY: The ‘big bang’ for IM came
as television became increasingly
fragmented during
the last decade

ELTING: All our divisions are part
of the same organization.  That’s
what we mean by IM – it’s all
part of one operation

‘Of course, there will always be TV-only advertisers – the huge corporations with multi-million dollar budgets.

‘But for the smaller marketer who’s only spending 30% of his communications budget on traditional media and the bulk of it – the most important part – in the areas the conventional agencies don’t handle, we can do every aspect of his below-the-line work – sales merchandising, collateral, point of purchase and sales promotion – and make the 30% pull harder for him too.’

What sets Promanad apart?

‘Our approach is certainly uncommon, but our facilities here mean that we can maintain the same consistency when it comes to executing our ideas.  Even our vast range of support services are all here under one roof.  We do everything – from dealer meetings in our own theatre, our own photography in our own studios, our own conventions and trade shows from our on-site warehouse and our own mechanical art and typesetting.’

Matthew uses a lively analogy: ‘You look at your house and you think it needs some renovation.  So you call the aluminum-siding man and aluminum siding is what you get.  If you call a general contractor, however, he’ll tell you what would really look good, from both an effectiveness and efficiency standpoint.  It may be that a new paint job is all you really need.  He’ll be far more likely to give you a truly objective solution because he doesn’t have just one product to sell.’

Mike Palmer, president of Palmer Bonner BCP, Toronto, largely agrees with Matthews on the inability of large, traditional agencies to fully integrate.  “I’d define most large agency moves into other businesses as creating a network of communications companies, not true integration,’ says Palmer.

‘Over the past 10 years, most agencies, especially the big ones, have been expanding vertically, and normally this has been by acquisition, rather than by building from scratch.

‘But what I feel sets us apart is the fact that we started the agency as an integrated shop from day one.  Two of the three founders were ex-marketing and management people, and with a third creative partner we built the agency on the shoulders of our previous expertise.’

Although all areas of his business have grown, the promotional side has probably grown faster than his other operations, he says, although the agency handles mainstream advertising for several major advertisers.

‘Many big agencies are saying: “How do we build a successful promotional division within this agency?” rather than saying “How do we fully integrate?”

‘The result is very often highly fragmented, even if it is nominally all under one roof.’

‘A total agency’

Another relatively new communications company, claiming to be a ‘total agency’ is Marbury Advertising Communications, Toronto.  President and creative director Gerry Kane says his shop has grown to $15 million in three years, ‘and it’s our appreciation that any Canadian agency today has to be able, right from the gate, to provide clients with a full range of services in the most economic manner possible.’

‘We started with all those elements in position because our analysis of the market place told us that, philosophically, we had to integrate right from the start.’

And his agency’s unique selling proposition?

‘When you approach an agency, it’s usually for one of two reasons – to take advantage of an opportunity or to solve a problem.

‘There are no absolute solutions.  But Marbury believes if we’re to steward our clients’ needs properly, we must have a full range of products and a variety of options.  The object is not to sell any one area but to find the proper collective solution to fit the client’s problem.’

Integrated marketing first

Miles Nadal, flamboyant president of the MDC Group, Toronto, believes he invented the ‘Integrated Marketing’ term.

His organization is one umbrella under which many communications elements, excluding mainstream advertising, are offered.

Nadal believes sales promotion currently accounts for 65% of the nation’s marketing and communications budgets, but can he really be an IM company without above-the-line services?

‘I believe that’s best left to the conventional agencies,’ he says.  ‘The best way to avoid conflict between ourselves and ad agencies is not to compete on their ground.’

So what’s in it for the clients?

Bob Outram is head of marketing communications for the Outdoor Marine Corporation based in Peterborough, Ont.  The company has been using Promanad for its sales promotion requirements for four years, and recently awarded them its mainstream advertising assignment as well.

He says Promanad’s approach ‘provides us with a much more comprehensive, more integrated program, making all its facets more effective.  It also speeds up the entire communications process between us, because there’s no need for lengthy re-education in every area.’

Susan Helstab, director of advertising and promotion at Four Seasons Hotels, Toronto, a Palmer Bonner, client, agrees.

‘We can make sure our corporate, long-term objectives are always reflected in our local, tactical efforts.’

Grey’s clients speak for themselves, in that more than 20 of the largest spenders are using multi-disciplines.

Not just a fad

Is integrated marketing more than a fad, then, and is it really here to stay?

Bob Armstrong, media director of Grey, says that three years ago, TV was fairly flat, while the ‘other print’ category, which includes direct response, was up 19% in terms of its share of revenue, with both it and outdoor media as the two strong growth areas.

Since then, he agrees there’s been a resurgence of national advertising funds into print media, partly because of shrinking budgets and the prohibitively high costs of TV production.

Peter Zarry offers his view as to whether IM is an enduring force to be reckoned with.

‘Your answer to that question depends very much on whether you’re in it or not,’ he says.  ‘Anyone who wants in at any cost is really courting disaster.  TV, for example, if you can afford it, will always do certain things – it’ll reach large numbers very quickly, its speed of delivery remains unchallenged, and it gets high awareness of a new product or service almost instantly.  No price will ever be too high for the right product, and it’ll always be with us, but with TV costs up 80% in 10 years, so will all the other communications tools, because of marketers’ constant quest for greater efficacy.

‘And because of our ability to manipulate the database, to target specifically using direct marketing methods, for instance, we know more about our customers than ever before, and can very efficiently single them out.  We can never go back on that now.’

There is a school of thought, however, that suggests that IM was born of a recession, when people were looking for short-term solutions, such as sales promotion, rather than long-term investment or strategic support of a franchise.  Does this mean that IM is simply a short-term phenomenon?

‘It may be true,’ says Elting, ‘that economics dictate that trend and those characteristics.  But the trend of clients using other than conventional media is a long term phenomenon not linked to any economic activity.

‘The growth in all our divisions has nothing to do with economics, but rather with a desire to spend money on what used to be called a narrowcast strategy – to reach an audience more efficiently.

‘It’s a huge step forward and will certainly continue.  We’ll always try to customize our operation to the changing needs of our clients.’

An aggregate view

An aggregate view of IM might be defined by certain basic precepts, for the differences between our representative sample of IM communications companies reflect only various degrees of approach and emphasis, rather than discordant, conflicting philosophies.  Integrated marketing in my view appears to be characterized by a number of additional criteria:

  • The need for multi-discipline involvement from the start
  • A synergy of multiple effort
  • Objectivity of assessment and recommendation, and above all
  • No vested interests.

For marketers who already recognize the value of fragmenting communications efforts, particularly those in categories where above-the-line dollars alone just aren’t working hard enough, or for the ‘new wave’ of entrepreneurial companies in highly-competitive sectors, the IM approach seems to be an extremely efficient and cost-effective method of ensuring a consistency of message few traditional outfits can rival.

When practised in its fullest sense by adept and creative communicators, IM seems sure to influence the whole industry as we head into the next century.

Paula Terry is a freelance writer living in Toronto.