ABRAR.docx

EXPLORING THE ANTECEDENT FACTORS THAT IMPACT IMC AND DETERMINING

THE RELATIONSHIP WITH THE CONSEQUENCES OF IMC

By

Abrar Salim Chohan

For

Award of Bachelors of Business Administration (Honors) in Marketing

Session: 2011 - 2015

THE ANTECEDENTS AND CONSEQUENCES OF IMC 2

RESEARCH COMPLETION CERTIFICATE

Certified that Abrar Salim, ID: 11U0408 [Session 2011 to 2015] has carried out and completed

the research project entitled Exploring the antecedent factors that impact IMC and determining

the relationship with the consequences of IMC] under my supervision for requirement for the

award of Degree of Bachelor of Business Administration Honors (Majors: Marketing) by Lahore

School of Economics.

Research supervisor,

(Mehrukh Salman)

Lahore School of Economics


Table of Contents Session: 2011 - 2015 ...................................................................................................................... 1

ACKNOWLEDGEMENTS ......................................................................................................... 5

ABSTRACT ................................................................................................................................... 6

CHAPTER 1: INTRODUCTION ................................................................................................ 7

Statement of Problem ................................................................................................................... 7

Research Questions ....................................................................................................................... 7

Research Significance & Research Gap ...................................................................................... 7

Research Objectives ...................................................................................................................... 8

Research Scope .............................................................................................................................. 9

CHAPTER 2: LITERATURE REVIEW ................................................................................. 10

BACKGROUND AND CONCEPTUALIZATION ................................................................. 10

CHAPTER3: METHODOLOGY ............................................................................................. 22

METHOD .................................................................................................................................... 22

Instrument Design ....................................................................................................................... 22

Measures ...................................................................................................................................... 22

Sample .......................................................................................................................................... 31

Analysis Procedures .................................................................................................................... 31

Table1A: Expected Signs ............................................................................................................ 32

CHAPTER 4: RESULTS AND ANALYSIS ............................................................................ 33

CFA Measurements .................................................................................................................... 33

Path Analysis ............................................................................................................................... 42

Path Model: ................................................................................................................................. 43

Model Fit ...................................................................................................................................... 44

CMIN ........................................................................................................................................... 44

Baseline Comparisons ................................................................................................................. 44

RMSEA ........................................................................................................................................ 44

Hypothesis Testing ...................................................................................................................... 46

Discussion .................................................................................................................................... 51

Suggestions for Future Research ............................................................................................... 53

Conclusion ................................................................................................................................... 53


References .................................................................................................................................... 55

Appendix: .................................................................................................................................... 59

Questionnaire .............................................................................................................................. 59


ACKNOWLEDGEMENTS

I would like to take this opportunity to appreciate the continuous efforts of my instructor Ms.

Mehrukh Salman. Her guidance and support made this research paper possible. Her immense

support and valuable suggestions regarding the thesis were very useful during the whole process.

Also, I would like to thank Ms. Samra Chaudry for her evaluation regarding the thesis.

\


ABSTRACT

This research will seek to explore the multiple marketing tools that impact Integrated Marketing

Communication (IMC). The significance of each variable will be emphasized and the

implementation of the variables will be evaluated. This research will also explain how Integrated

Marketing Communication (IMC) has a relationship with the organization performance. Thus,

both the antecedent factors and consequences of Integrated Marketing Communication (IMC)

will be studied to determine the importance of using Integrated Marketing Communication.


CHAPTER 1: INTRODUCTION

Integrated Marketing Communication (IMC) is a method of applying an integrated

approach of marketing by achieving efficiency through synergy(Rehman & Ibrahim, 2011). It

involves merging the variant marketing tools in a manner that enables an organization to have

one voice, one look (Fitzpatric, 2005). The marketing of products & services has changed

drastically in the recent years. Technological developments and innovations have influenced the

perception of millions of consumers. Therefore, marketers have to adapt to these advances by

conducting their marketing activities and campaigns in a holistic consumer-oriented manner. The

marketing environment has changed immensely and there is a need to keep up with the pace to

be more efficient and effective. Implementing Integrated Marketing Communication is a more

cost-efficient and effective method of marketing.

Statement of Problem

This research will seek to explore the multiple marketing tools that impact Integrated

Marketing Communication (IMC). The significance of each variable will be emphasized and the

implementation of the variables will be evaluated. This research will also explain how Integrated

Marketing Communication (IMC) has a relationship with the organization performance. Thus,

both the antecedent factors and consequences of Integrated Marketing Communication (IMC)

will be studied to determine the importance of using Integrated Marketing Communication.

Research Questions

What are the various factors that impact Integrated Marketing Communication and what

degree of impact each factor has on Integrated Marketing Communication?

What is the relationship between Integrated Marketing Communication (IMC) and the

performance of an organization? Does Integrated Marketing Communication (IMC) have an

impact on quantitative and quantitative measures of Organization Performance?

Research Significance & Research Gap

The research topic was selected as there was a research gap that needed to be addressed.

In the 14th

International Conference in Research in Advertising 2015, there is a Call for Papersby

the American Academy of Advertising on various subjects such as Advertising, Consumer


Behaviour, Management, etc. The theme of the conference was bridging the gap which

literally means to ensure that the academic theories are being implemented as well. Thus, this

research is useful for managers as it provides them with an insight on which kind of marketing

tools they can incorporate in their marketing campaigns. An important decision that marketing

managers have to make is the budget decision and allocation of resources. Therefore, this

research would provide information to them in regard to which effective marketing tools should

be included in the marketing campaigns. The significance of each factor will offer knowledge to

the managers as to which marketing tools should be focused upon.

The research will also provide findings that would enhance the performance of an

organization. The relationship between Integrated Marketing Communication (IMC) and

organizational performance will be specified. An organization can be quantitatively and

qualitatively improved by associating Integrated Marketing Communication (IMC) tools with the

marketing campaigns. This study will define how brand equity can be improved through

different marketing tools. Also, brand performance can be improved through extensive sales and

profits by integrating various marketing tools. The evidence of enhanced organization image is

also depicted in this research as Customer Relationship Management can be maintained.

Research Objectives

The primary purpose or aim of this study is to explore the importance of Integrated

Marketing Communication (IMC) in the dynamic marketing environment and to analyze the

implementation of Integrated Marketing Communication (IMC) within business organizations in

the province in Punjab, Pakistan. This main aim will be pursued through the following

objectives:

- To specify how each marketing tool impacts Integrated Marketing Communication

- To examine the relationship of the factors that influence Integrated Marketing

Communication (IMC)

- To explore the extent to which changes in the marketing environment have caused the

marketing managers to shift to using a more integrated approach to marketing.

- To determine the positive impact in organizational performance by incorporating

Integrated Marketing Communication (IMC)


- To identify any potential barriers or limitations that stand in the way of implementing

Integrated Marketing Communication (IMC) by a business organization

Research Scope

It is not possible to measure the marketing activities and organizational performance of

all organizations in the world and thus the scope of the study is more narrowly focused on the

medium and large scale organizations in the province of Punjab (Pakistan). The organizations

that will be targeted should have a marketing functional department which is practicing various

marketing techniques so that the findings can be more accurate and precise.


CHAPTER 2: LITERATURE REVIEW

BACKGROUND AND CONCEPTUALIZATION

The definitions of the variables identified by literature are following:

Direct Marketing

Direct Marketing is a business process that aims to maximize profits through marketing. This is

done by reducing costs as well. Direct marketing is one of the most effective marketing methods

with an aim to maximize the customers lifetime value (Kim, Song, & Kim, 2009).

Sales Promotion

Sales promotions can be classified into consumer sales promotions and trade sales promotions.

Other classification of sales promotion is monetary sales promotion and non- monetary sales

promotion (Chandon, Morwitz, &Reinartz, 2005).

Advertising

The selling job of advertising is to generate information to the consumer (Nelson, 1974).

Internet Marketing

Internet provides consumers and organizations with an enormous potential of information and

communication and the possibility of interaction with each other (Adelina Eugenia Ivanov,

2009).

Public Relations

Public Relations or Publicity is recognized as an efficient, credible means of communication

(Stammerjohan, Wood, Chang, & Thorson, 2005).

Integrated Marketing Communication

An approach to achieving the objectives of a marketing campaign, through a well-coordinated

use of different promotional methods that are intended to reinforce each other (Kitchen, 2000).


Brand Equity

Brand Equity means to have strong and highly favourable brand associations of customer

(Keller, 1993).

Brand Performance

Brand Performance can be defined as the success of the brand in the market and the strategic

success of a brand(Wong, 2008).

Customer Relationship Management

Customer Relationship Management is defined as acquiring best customers, maintaining and

encouraging them to consume products and services of the company more(Ekhlassi, Maghsoodi,

& Mehrmanesh, 2012).

This study will explore the factors that impact Integrated Marketing Communication in an

organization. Direct Marketing, Sales Promotion, Advertising, Internet Marketing, Public

Relations &Personal Selling are the components in the promotional mix that influence IMC.

The relationship of the factors with IMC will be backed by literature in the following review.

Direct Marketing and IMC

Direct Marketing is a business process that aims to maximize profits through marketing.

This is done by reducing costs as well. Direct marketing is one of the most effective marketing

methods with an aim to maximize the customers lifetime value (Kim, Song, & Kim, 2009).

Customer Lifetime Value is a measure of Integrated Marketing Communication as mentioned in

the previous review. Therefore, IMC acts as an intermediary between Direct Marketing and

Customer Lifetime Value. The author states that the suggested marketing strategy, i.e. direct

marketing is an beneficial implementation for effective marketing campaigns that focus on

reducing costs and improving profits. In The Effects of Direct Marketing Techniques on

Performance: An Application to Arts Organizations, the authors Arnold &Tapp (2011) measure

the importance of direct marketing through sales performance. Sales Performance is a measure of


IMC and therefore it is related that Direct Marketing effects IMC and in turn Sales Performance.

The research question that was constructed was Does the extent of implementation of direct

marketing affect performance? That is, is more direct marketing better? The method of data

collection used was direct marketing, majorly direct mail and telephone. A sample size of 600

was chosen and questionnaires were used as the instrument. 217 responded which is a response

rate of 37% and the results were gathered through multiple regression analysis. The results

indicate that Direct Marketing positively and significantly impacts sales performance. However,

the study emphasizes on the fact that the best medium of marketing communication varies with

the kind of product and industry. Thus, direct marketing is not always the way to go. There are

other marketing tools that should be incorporated to achieve an overall positive effect. Also, the

study highlighted some limitations that need to be addressed. Some external variables such as

educational awareness, satisfaction & loyalty my influence the results. In the article, Direct

Marketing in UK Retailing: Rhetoric and Reality, the authors, Shields & Reynolds (1996)

measure the adoption and implementation of direct marketing in retail business. The objective

of the research was to establish levels of usage of direct marketing, to identity any pattern on the

usage of direct marketing, the perceived importance of direct marketing, the motives of direct

marketing and the degree of commitment to direct marketing. Questionnaires were distributed

amongst 280 respondents and data collection was administered through telephone. The results

showed that the two major reasons that firms choose to incorporate direct marketing as

marketing tools is to win businesses from current customers (90%) & to build customer loyalty

(87%).

Sales Promotion and IMC

Sales promotions can be classified into consumer sales promotions and trade sales

promotions. Consumer sales promotions are directed at the customers, consumers, or the

retailers. Trade sales promotions are target the wholesalers. Other classification of sales

promotion is monetary sales promotion and non- monetary sales promotion. The most common

type of monetary promotions includes discounts, coupons, and rebates. Non-monetary

promotions are represented by store flyers, in-store displays, shelf talkers and other methods of

drawing consumer attention to specific products(Pauler & Dick, 2006). Sales promotions are

marketing events that are designed to increase customers purchase in a determined period


(Ramezani & Heidarzadeh, The Impact of Monetary and Non-Monetary Promotions on Brand

Equity in Industrial Market, 2014). The following hypotheses were tested in the article, The

Impact of Monetary and Non-Monetary Promotions on Brand Equity in Industrial Market:

H1: by using monetary promotions, brand perceived value is decreased by customer.

H2: by using monetary promotions, brand association is decreased by customer.

H3: by using nonmonetary promotions, brand perceived value is increased by customer.

H4: by using nonmonetary promotions, brand association is increased by customer.

The research conducted was quantitative and it was an attempt to measure and deal with the

customers purchase intention. Information oriented sampling was used for data collection. A

five-point Likert-type scale was used in the instrument. H1 was rejected. This means that using

monetary promotion does not decrease the perceived value. Also, H2 is rejected as well which

shows that using monetary promotions do no decrease the brand associations. Results indicate

that monetary promotion cant have a negative influence on brand association. Finally, H3 and

H4 were both accepted which concludes that non- monetary sales promotions increase brand

perceived value and also increase the brand association. In The value of non-monetary-based

retail promotions: Comparing an in store experiment to simulated purchasing, an experiment

was conducted by Corsi, Loose &Lockshin (2013) to measure the effect of non-monetary sales

promotions on the number of sales. The research question that was developed was RQ1.1: Do

in-store non-monetary promotions increase sales of wines? The study comprised three main

stages: the selection and pre-test of the promotional messages and logos, the in-store experiment

and the online discrete choice experiment. It was concluded that there is a positive effect of non-

monetary sales promotion on the number of sales. The promotional effect caused a +52%

increase in total sales.

Advertising and IMC

The selling job of advertising is to generate information to the consumer (Nelson,

1974). In the article The Brand Capability Value of Integrated Marketing Communication, the

authors Ratnatunga& Ewing (2005) measure the impact of each IMC tool on IMC and on Brand

Recognition. Advertising, direct marketing, public relations, sponsorships, promotions & www

are the tools that are researched upon in the study. The results show that there is a 60%

contribution of advertising on Brand Recognition which is a majority. In An Empirical


Investigation of the Interaction between Publicity, Advertising, and Previous Brand Attitudes

&Knowledge, the authors, Stammerjohan, Wood, Chang & Thorson (2005) empirically

investigate the relationship of advertising with the attitude of the brand. Positive radio

advertisements and print advertisements were used as advertising mediums. The results show

that advertising has a positive effect on both the attitude of the ad and also on the attitude of the

brand.

Public Relations and IMC

Public Relations or Publicity is recognized as an efficient, credible means of

communication (Stammerjohan, Wood, Chang, & Thorson, 2005). The crucial perspective in

this scenario is that the PR of the organization can be both negative and positive. Public relations

can make or break the business organization. The public relations of the company can change the

attitude of the consumer on the brand and also on the advertisement (Stammerjohan, et al.,

2005). In Integrated Marketing Communications: Practice Leads Theory, the comparison

between advertising and public relations is done and how it effects IMC. Kitchen, Kim &Scultz

(2008) acknowledge that various tools of IMC are used in marketing campaigns and it is

essential to evaluate how each tool is beneficial. Some organizations outsource their PR

department to agencies so that it is done more effectively. The comparison shows that there more

employees employed in PR agencies rather than in advertising agencies. The unit of analysis was

respondents from Korea, U.S.A & U.K. Also, the study describes quantitatively that

Multinational Corporations focus more on PR rather than on advertising. However the

implementation rate is lower in all three countries. In Korea, advertising has an implementation

rate of 87% as compared to 80% of PR. In U.S, Advertising has a near 100& implementation rate

as compared to 60% of PR. This shows that although organizations and firms value PR, but it is

difficult to implement and achieve it.

Internet Marketing and IMC

The internet is an important tool in the developing world to get your message across.

Internet provides a prospect for interaction and is valued highly by both consumers and

organizations. The Business to Consumer market is largely focused on the internet as it leads to

market penetration and market development. More consumers can be targeted and also other


consumers in geographical locations can be reached which was initially not possible. In the

article, The internets impact on integrated marketing communication, internet is defined to

have 5 elements. The internet technology will be everywhere, it will always be accessible, it will

always be on, anyone will be able to access the information, it will be invisible. This proves that

the emerging or new media which is the internet has a crucial role to play as an IMC tool.

However Ivanov (2012) points out there are several disadvantages to internet marketing as well

because sometimes things go out of control (viral). There is a lesser control of the marketer. It

depends majorly on the consumer whether they would want to spread the message or not. There

may be an increased risk of negative reactions from the consumers. In Direct Marketing on the

Internet: An Empirical Assessment of Consumer Attitudes, the authors Mehta &Sivadas (1995)

study the attitude of consumers on internet related marketing activities. The attitude towards the

targeted advertisements was positive. The interest and involvement of consumers on

advertisements is positive as well. The consumers attitude on the commercialization of internet

has mixed responses. Some consumers are not satisfied with the amount of information that is

available on the internet whereas some see it as a benefit. However, these were measures of

attitudes not behaviours.

This study would look at the results of incorporating Integrated Marketing

Communication in an organization. Implementing the IMC approach results in greater brand

equity, brand performance & also helps to achieve higher customer relationship management.

These results will be backed by literature in the following review.

IMC and Brand Equity

Brand Equity means to have strong and highly favourable brand associations of

customer(Keller, 1993). Therefore, a brand has positive customer-brand equity when the

consumers react favourably to the product offering. Madhavaram, Badrinarayanan&McDonald

(2005) defined IMC as critical components of brand equity. The qualitative measures of brand

equity will be addressed in this portion. The quantitative factors will be branched under brand

performance in the next portion. Aaker (1996) categorizes the qualitative factors as assets and

labels them as brand awareness, brand loyalty, brand association and other propriety of brand


assets such as brand image. All these factors help the organizations to gather the attention of

customers and through customer relationship management; the customers are retained as well.

Keller (1993) defines brand awareness as the strength of the brand trace in memory that is

reflected by the consumer's ability to identify the brand under different conditions. He also

defined brand image as perceptions about a brand as reflected by the brand associations held in

consumer memory. In the article, Integrated Marketing Communication (IMC) and Brand

Identity as Critical Components of Brand Equity Strategy the relationship between IMC and

brand equity is tested. Brand Equity is further divided into brand awareness and brand image.

Brand awareness and image have been defined so that the results can have greater meaning.

One hypothesis was P5a: IMC effectiveness is relatedpositivelyto brand awareness.

The other hypothesis was P5b: IMC effectiveness is related positively to brand image. It was

concluded through results that effective implementation of IMC leads to higher brand awareness,

image and hence greater brand equity. However, the authors also mentioned a key point that

effectiveness in IMC can be achieved through synergy. Synergy can be maintained when the

combined effect of the IMC activities (which will be mentioned in the next review) is greater

than the sum of the individual activities. Thus, you need to have and integrated approach to get a

unified message across so that the customers have an identical and similar message delivered to

them. In the article, The Brand Capability Value of Integrated Marketing Communication, the

value of intangible assets of a firm is looked at. The relationship between the IMC variables and

brand recognition capability is measured. Having a strong brand recognition leads to stronger

competitive advantage (Ratnatunga & Ewing, 2005). Brand recognition is a qualitative factor

and therefore is an intangible asset. The authors acknowledge that measuring the extent of brand

recognition was difficult as they had to construct their own scale. The scale that was used in this

research was Capability Economic Value of Intangible and Tangible Assets (CEVITA). This

valuation approach takes into account both the tangible and intangible assets. Therefore, it is a

valid scale to measure the qualitative factor; brand recognition. In this article, brand equity is

termed as what one has (Ratnatunga & Ewing, 2005). The study concluded with the result that

the value of the brand is strengthened by applying the various IMC tools. The brand recognition

was measured by the percentage of repeat- purchase customers. The authors Ratnatunga&

Ewing (2005) highlight that retaining the customers should be more of a priority rather than

acquiring them. Therefore, this review would also be addressing the importance of customer


relationship management later. In the article, The Relationship between Integrated Marketing

Communication, Market Orientation, and Brand Orientation, Reid, Luxton&Mavondo (2005)

discuss the impact of IMC on brand orientation. Urde (1994) defined brand orientation as an

approach in which the processes of the organization revolve around the creation, development,

and protection of brand identity in an ongoing interaction with target customers with the aim of

achieving lasting competitive advantages. Brand identity is a measure of brand equity as

mentioned earlier.Urde (1994) points out that to create a successful brand identity, it is

necessary to ensure that brand messages are strategically driven and are synchronized. This key

point was highlighted earlier in the review that an integrated approach should be maintained. The

study links IMC to brand orientation. And the results indicate the close positive relationship and

interdependence of brand orientation & IMC. Brand orientation adds value to the offerings and

it gives a competitive advantage. Thus, this creates brand distinctiveness. The authors, Reid,

Luxton&Mavondo (2005) suggest that brand orientation can be drawn from 6 elements. A shared

brand vision; in which the strategic goals are being directly related to the brand, shared brand

functionality; in which the organization communicates specific functional attributes and benefits

to the customers by differentiating themselves from their competitors, shared brand positioning;

in which the brand forms a means of identification, differentiation, brand return on investment;

in which brand equity leads to higher ROI, brand symbolism; in which the brand has a strong

emotional and symbolic appeal, brand value adding capability; in which satisfying the customers

is the ultimate goal. Most of these are qualitative factors and all of these factors result in higher

brand equity. However, the authors acknowledge that implementing these marketing concepts

into the marketplace is difficult. There have been implications with the operationalization in the

organizations. In the article, How can integrated marketing communications and advanced

technology influence the creation of customer-based brand equity? the relationship between

IMC and brand equity is measured. In the article, brand equity is divided into three qualitative

variables; brand image, perceived quality & brand loyalty (Seric, Gil-Saura, & Ruiz-Molina,

How can integrated marketing communications and advanced technology influence the creation

of customer-based brand equity?, 2014). In this study, information technology is determined to

be the key influence and also the mediating factor that enhances brand equity. The relationship

between IMC and brand equity was noted from the customer perspective and the findings

revealed positive and strong relationships between the variables. The following hypotheses were


H1: IMC perception has a positive impact on brand image.

H2: IMC perception has positive impact on perceived quality.H3: IMC perception has a

positive impact on brand loyalty. Also, IMC can influence and

control the meanings linked with the brand, create and reflect the brand image, thus influencing

the way consumers perceive the brand (Cobb-Walgren, Ruble, & Donthu, 1995). Kitchen,

Brignell, Li & Jones (2004) also acknowledge the importance of building and increasing a

brands image-based equity. Finally, Tsai (2005) gives and overall view in the article, Integrated

marketing as management of holistic consumer experience. The author states that for achieving

brand equity, there should be strategic brand management. The IMC tools such as public

relations, sales promotion, personal selling, advertising, online marketing, & direct marketing

should be unified in the marketing campaign. This augments and strengthens the holistic

consumer experience by building brand equity.

IMC and Brand Performance

Brand Performance can be defined as the success of the brand in the market and the

strategic success of a brand (Wong, 2008). The brand performance can be measured by two

aspects; brand market performance & brand profitability performance. Both are quantitative

measures. Baldauf, Cravens & Binder (2003) declare that brand profitability performance is an

index of the financial share of brand in relation with the profits keeping the profit margin in

account, whereas, brand market performance is a measure based on the level of sales & market

share. In the article, The Brand Capability Value of Integrated Marketing Communication,

Ratnatunga&Ewig (2005) evaluate how the right mix of marketing activities, if implemented

effectively, can optimize sales and profitability. The study mentions ROI as a measure of Brand

Performance. The size and rate of growth of the total market is kept into account when studying

the variables. H1: IMC tools & Immediate Sales H2: IMC tools & Future Sales. The results

show that IMC can potentially have both an attitudinal effect on the brand and a behavioural

effect on sales. The authors point out that this relationship is crucial for marketing directors as it

gives them an indication of how well they have performed by evaluating the sales revenue. Also,

the potential sales target can also be evaluated based on the mix of the IMC variables. How each

IMC tool affect Sales will be focused in the next review. In the article, Strategy in Direct and

Interactive Marketing and Integrated Marketing Communications, the benefits of Integrated


Marketing Communication are looked at. IMC is becoming crucial for marketers due to its

advantage of providing cost effectiveness (Csiksov, Antoov, & ulkov, 2014). IMC

creates competitive advantage by boosting sales and profits, while saving time & money. The

article states that a unified message can have a greater impact rather than disjointed messages. A

clear cut, consistent message has more chance of being delivered across through to the

customer. Also, in the minds of the consumer, the risk is reduced. The customers perceive the

message as more reliable and credible. In the article, The Relationship between Integrated

Marketing Communication, Market Orientation, and Brand Orientation, the relationship

between IMC and Brand Performance is directly measured. Brand performance indicators can be

financial indicators of performance such as sales, market share, profit, and ROI. (Reid, Luxton,

& Mavondo, The Relationship between Integrated Marketing Communication, Market

Orientation, and Brand Orientation, 2005) Also, the authors stated that IMC has been

hypothesized to provide benefits in the coordination of marketing communication activities and

across the various functions involved in the implementation of marketing campaigns. The

hypothesis of this study was H6: IMC is directly and positively related to brand

performance. This relationship was tested as strong and positive. One of the implications for the

managers was the integration of IMC to deliver brand performance would be generally difficult.

This would require routine cooperation from all levels of the management. In the article,

Performance Auditing of Integrated Marketing Communication (IMC) Actions and Outcomes,

Reid (2005) studies the relationship of IMC with Sales Performance. Brand outcomes such as

sales are key issues according to the author. A sample of 250 was chosen and amongst services

organizations targeted by the survey included legal services, management consultants, architects,

and engineering firms. Consumer goods organizations included food and electronics

manufacturers.The CFA model that was chosen by the researcher indicated that there was a

strong positive relationship between IMC and Sales Performance. In the article, Model of

Marketing Communications Effectiveness in the Business to Business Markets,

Jerman&Zavrsnik (2012) examines the impact of marketing communication effectiveness and

organizational performance. The study showed that implementing IMC may be strongly related

to better marketing results in terms of sales, market share & profits for an organization. These are

all measures of the brand performance. The firms market share was kept in mind as it influences

the competitive market position. 269 respondents were measured on a 7-point Likert scale. The


latent variable marketing communication effectiveness also had a positive impact on the other

endogenous variable of .organizational performance (standardized coefficient = 0.44). Thus the

hypothesis tested was positive. In the article, How Marketing Communications Correlates with

Business Performance, the correlation between marketing communication activities and

business performance is studied. The study was conducted to determine which activities help

raise net profits and which communication activities should a firm incorporate to optimize

business performance. (Mumel, Hocevar, & Snoj, 2007) H1: There is no correlation between

the number of marketing communication activities the company uses and its aggregate business

performance. H3: There is no correlation between the frequency of using a specific marketing

activity or tool and its aggregate business performance.The study defines aggregate business

performance as 13 variables; the aggregate business performance of a company is defined

through 13 variables: net sales, net sales growth index, net profit margin, return on equity, net

return on assets, net profit/loss per employee, net business result for the accounting period,

customer loyalty, achieved profit vs. planned, achieved net return on investment vs. planned,

achieved net sales vs. planned, achieved market share vs. planned, and achieved employee

loyalty vs. planned. The results showed that the correlation between the number of marketing

communication activities a company uses and net sales is significant: p=0,001 and positive

r=0,428. Hence, both H1 & H3 were rejected, meaning that there is a positive relationship

between the number and frequency of marketing activities and brand performance.

IMC and Customer Relationship Management

Customer Relationship Management is defined as acquiring best customers, maintaining

and encouraging them to consume products and services of the company more. (Ekhlassi,

Maghsoodi, & Mehrmanesh, 2012). CRM has become a priority for firms and organizations as

it provides a competitive edge to survive in competitive market. (Becker, Greve, & Albers, 2009)

In the article, Determining the Integrated Marketing Communication Tools for Different Stages

of Customer Relationship inDigital Era, the authors have classified CRM into 3 stages as

Customer Acquisition (CA), Customer Retention (CR), & Customer Development (CD)

(Ekhlassi, et al., 2012)CRM is an organizational approach to understanding and influencing on

customer behaviour through a meaningful relationship. The article states that a company loses


20-40% of their customers annually. Thus, customer acquisition is crucial. New customer

acquisition deals with gaining short term profits and growth and focuses on general public.

Because of the IT developments and the capability to collect customer information and purchase

history, Customer retention strategies have become crucial as well. Acquiring a new customer is

almost five times more expensive than customer retention. Thus customer retention is critical in

regard to Customer Relationship Management. This includes building, maintaining and

continuing a long term relationship with the customer. Customer Development means that the

company increases their selling to current customers. Thus, market penetration techniques can be

used to target more customers. Also, product development can be done to enhance the quality of

the current product or service. The study concludes by stating that a two-way relationship with

the customer is important and it can be maintained through various IMC techniques. In the

article, Marketing Dj Vu: The Discovery of Integrated Marketing Communications, the

authors state that the focus should be on the consumer or the audience. (Spotts, Lambert, &

Joyce, 1998) Also, fostering long-term relationships between the customer and the company is

imperative. The author highlights that currently IMC offers several new perspectives in

marketing, such as having an integrated approach, being consumer-focused, and that marketing

communication is much broader and has various elements other than promotion. Therefore, the

key to achieve organizational goals is to determine the needs and wants of target markets and

delivering the desired satisfaction more effectively and efficiently than competitors. The author

shows the importance of CRM by stating that the IMC tools should be used to focus on the

consumer or the customer, not on the organizations sales or profit goals.


CHAPTER3: METHODOLOGY

METHOD

Instrument Design

For this empirical research, the primary data is collected through a structured

questionnaire. The questionnaire is the instrument which consists of close-ended questions

measured by 5-point Likert type scale (Seric, Gil-Saura, & Ruiz-Molina, How can integrated

marketing communications and advancedtechnology influence the creation of customer-based

brand equity? Evidence from the hospitality industry, 2014). The latent variables will be

measured by the items in the questionnaire. The questionnaire was written in English and each

variable was measured by at least 5 items.

Measures

Direct Marketing:

Direct Marketing was measured by using five items on five-point Likert-type scale

from 1 (strongly disagree) to 5 (strongly agree). These items were extracted from the studies by

(Taylor, Frank & Maynard, 2000).

Direct Marketing 1 2 3 4 5 Sources

Telemarketing calls are an

opportunity to provide feedback to

the marketer.

Items adapted

and modified

from (Taylor, Frank &

Maynard, 2000)

Telemarketing calls serve a useful

purpose

Items adapted

and modified


Maynard, 2000)

Telemarketing is an offensive way to

sell

Items adapted

and modified


Maynard, 2000)

It is acceptable for direct marketers to

make personal information available

to other companies

Items adapted

and modified

from (Taylor, Frank


&Maynard, 2000)

It is acceptable for direct marketers to

make information on my purchasing

habits available to other companies

Items adapted

and modified


Maynard, 2000)

The governments should exercise

more control over sales messages that

come in the mail.

Items adapted

and modified


Maynard, 2000)

Thegovernment should exercise more

control over telephone sales

messages.

Items adapted

and modified


Maynard, 2000)

Sales Promotion:

Sales Promotion was measured by using five items on five-point Likert-type scale

from 1 (strongly disagree) to 5 (strongly agree). These items were extracted from the studies by

Lichtenstein, Burton &Netemeyer (1997).

Sales Promotion 1 2 3 4 5 Sources

I am more likely to buy a brand if it

has a cents-off deal on the label.

Items adapted

and modified

fromLichtenstein, Burton

&Netemeyer (1997).

Consumers enjoy buying products

that come with a free gift

Items adapted

and modified


&Netemeyer (1997).

Consumers take advantage of the

buy one- get one free offer

Items adapted

and modified


&Netemeyer (1997).

I am more likely to buy brands that

are displayed at the end of the aisle.

Items adapted

and modified


&Netemeyer (1997).

Consumers are more likely to buy a

brand that is on sale

Items adapted

and modified


&Netemeyer (1997).


Consumers are more compelled to

respond to contest or sweepstake

offers.

Items adapted

and modified


&Netemeyer (1997).

Advertising:

Advertising was measured by using six items on five-point Likert-type scalefrom 1

(strongly disagree) to 5 (strongly agree). These items were extracted from the studies by Pollay&

Mittal (1993).

Advertising 1 2 3 4 5 Sources

Advertising results in better products

for the public

Items adapted

and modified

fromby Pollay& Mittal

(1993).

In general, advertising helps our

nations economy

Items adapted

and modified


(1993).

Advertising is a valuable source of

information about products and

services

Items adapted

and modified


(1993).

Quite often advertising is amusing

and entertaining.

Items adapted

and modified


(1993).

Advertising promotes undesirable

values in our society.

Items adapted

and modified


(1993).

Advertising makes people buy

unaffordable products just to show

off.

Items adapted

and modified


(1993).


Public Relations:

Public Relations was measured by using five items on five-point Likert-type

scalefrom 1 (strongly disagree) to 5 (strongly agree). These items were extracted from the studies

by Mellado&Barria (2012).

Public Relations 1 2 3 4 5 Sources

Our organization develops a long-

term relationship with the public

Items adapted

and modified

fromMellado&Barria

(2012).

Our organizations reputation is the

most important intangible asset

Items adapted

and modified

fromMellado&Barria

(2012).

Our organization reacts to short-term

problems as they occur

Items adapted

and modified

fromMellado&Barria

(2012).

Our organization develops strategic

plan for building trust

Items adapted

and modified

fromMellado&Barria

(2012).

Our organization avoids controversial

topics that may arise internally

Items adapted

and modified

fromMellado&Barria

(2012).


Internet Marketing:

Internet Marketing was measured by using seven items on five-point Likert-type

scalefrom 1 (strongly disagree) to 5 (strongly agree). These items were extracted from the studies

by Prasad, Ramamurthy & Naidu (2001).

Internet Marketing 1 2 3 4 5 Sources

Our organization makes use of

internet to promote and advertise the

companys products, services & capabilities

Items adapted

and modified


Maynard, 2000)

Our organization provides online

product catalog to customers and

prospects

Items adapted

and modified


Maynard, 2000)

Our organization answers customers

queries about product availability,

order status, etc. through internet

Items adapted

and modified


Maynard, 2000)

Our organization allows customers to

place online orders

Items adapted

and modified


Maynard, 2000)


internet to build awareness and image

Items adapted

and modified


Maynard, 2000)


internet to boost sales

Items adapted

and modified


Maynard, 2000)


internet to improve profitability

Items adapted

and modified


Maynard, 2000)


Integrated Marketing Communication (IMC):

IMC was measured by using seven items on five-point Likert-type scale from 1 (strongly

disagree) to 5 (strongly agree). These items were extracted from the studies by Reid (2005).

Integrated Marketing

Communication

1 2 3 4 5 Sources

Our brand's media plan is a strategic

balance between mass media and

one-to-one media.

Items adapted

and modified

fromReid (2005).

Special programs are in place to

facilitate customer inquiries and

complaints about your brand

Items adapted

and modified

fromReid (2005).

In your company, the process of

managing the brand's reputation is the

responsibility of all departments and

employees.

Items adapted

and modified

fromReid (2005).

The people managing the

communications program for your

brand have a good understanding of

the strengths and weaknesses of all

major marketing communications

tools, such as direct response,PR,

sales promotion, advertising, and

packaging.

Items adapted

and modified

from Reid (2005).

Your company does a good job of

internal marketing, informing all

areas of the organization about your

brand's objectives and marketing

programs.

Items adapted

and modified

fromReid (2005).

You regularly review your marketing

plan to ensure relevance and

consistency of your brand messages

and strategic brand positioning.

Items adapted

and modified

fromReid (2005).


The stated objective of your brand's

marketing communication program is

to create and maintain profitable

relationships with customers and

other stakeholders by ensuring

consistency in all messages sent to

these groups.

Items adapted

and modified

fromReid (2005).

Brand Equity:

Brand Equity was divided into 5 components and each component had 1 item. There

were a total of 5 items that were measured on five-point Likert-type scalefrom 1 (strongly

disagree) to 5 (strongly agree). These items were extracted from the studies by Washburn &

Plank (2002).

Brand Equity 1 2 3 4 5 Sources

The likelihood that consumers

perceive our companys products as reliable and of good quality is high

Items adapted

and modified

fromby Washburn & Plank

(2002).

Consumers consider our companys

products to be their first choice

Items adapted

and modified


(2002).

Consumers can recognize our brands

among other competing brands

Items adapted

and modified


(2002).

Consumers can quickly recall the

symbol and logo of our brand

Items adapted

and modified


(2002).

If another brand has the same features

as our brand, consumers prefer to buy

our brand

Items adapted

and modified


(2002).


Brand Performance:

Brand Performance was measured by using a total of 5 items that were measured on

five-point Likert-type scalefrom 1 (strongly disagree) to 5 (strongly agree). These items were

extracted from the studies by Lai, Chiu, Yang &Pai (2010).

Brand Performance 1 2 3 4 5 Sources

Purchasing or using our brand will

increase our companys sales growth Items adapted

and modified

fromby Lai, Chiu, Yang

&Pai (2010).


increase our companys market share

Items adapted

and modified


&Pai (2010).


increase our companys margin

Items adapted

and modified


&Pai (2010).


increase our companys profitability

Items adapted

and modified


&Pai (2010).


increase our companys overall

performance

Items adapted

and modified


&Pai (2010).


Customer Relationship Management (CRM):

Customer Relationship Management (CRM) can be divided into 3 components

Customer Acquisition (CA), Customer Retention (CR), & Customer Development

(CD)(Ekhlassi, Maghsoodi, & Mehrmanesh, 2012). CRM was measured by using six items on

five-point Likert-type scale from 1 (strongly disagree) to 5 (strongly agree). These items were

extracted from the studies by Yim, Anderson &Swaminathan (2004)

Customer Relationship

Management

1 2 3 4 5 Sources

Our Organization has established

clear business goals related to

customer acquisition, development, &

retention

Items adapted

and modified

from Yim, Anderson

&Swaminathan (2004)

Our Organization has the sales &

marketing expertise and resources to

succeed in CRM

Items adapted

and modified

from Yim, Anderson

&Swaminathan (2004)

Our employee training programs are

designed to develop the skills

required for acquiring and deepening

customer relationships

Items adapted

and modified

from Yim, Anderson

&Swaminathan (2004)

Employee performance is measured

and rewarded based on meeting

customer needs and on successfully

serving the customer

Items adapted

and modified

from Yim, Anderson

&Swaminathan (2004)

Our Organization does not commit

time and resources in managing

customer relationships

Items adapted

and modified

from Yim, Anderson

&Swaminathan (2004)

Our organization provides channels to

enable ongoing two-way

communication between our key

customers and us

Items adapted

and modified

from Yim, Anderson

&Swaminathan (2004)


Sample

This study used existing scales to gather data on the factor affecting IMC and the

dependant variables of IMC. Non- probability samples were used so that the unit of analysis was

easily available and researched upon. A convenience sample of 200 was chosen that was easy to

reach. A response rate of 75% is expected so that there would be at least 150 responses that

could be measured and evaluated. The unit of analysis is organizations in Punjab, Pakistan that

have a marketing functional department in the organization. The questionnaire, which is the

instrument, will be sent out to the middle and top-level managers in these organizations. The

advertising and marketing agencies were excluded from the research as their responses may be

biased (Phelps, Harris, & Johnson, 1996). The names of the organizations managers were sought

and they were targeted.

Analysis Procedures

The main research instrument for empirical investigation in this research is self-

administered questionnaire which was constructed through literature. The research is empirical

quantitative thus surveys would be conducted to gather the primary data from the unit of

analysis. For the operationalization of this research, the instrument would be sent to the unit of

analysis by direct mail and through e-mail. These methods are cheap, quick as easy to administer

as well. The address information of all respondents would not be easily available thus e-mail is

considered to be an effective channel to get through to the managers of the organizations as the

contact information can be gained from the organizations website. Once the data has been

collected, the hypothesis testing will be done through regression analysis. This is a statistical

process to measure the relationship among the variables. The software used for the regression

analysis will be SPSS (Seric, Gil-Saura, & Ruiz-Molina, How can integrated marketing

communications and advancedtechnology influence the creation of customer-based brand

equity? Evidence from the hospitality industry, 2014). Confirmatory Factor Analysis would be

conducted as well to ensure that the independent variables do indeed impact the dependant

variables so that the non significant variables or items can be discarded. The reliability will be

examined to make sure that there is an important relation among variable in the proposed

theoretical framework.


Table1A: Expected Signs

Variable Expected sign Author

Direct Marketing + (Kim, Song, & Kim, 2009)

Sales Promotion + (Chandon, Morwitz,

&Reinartz, 2005)

Advertising + (Nelson, 1974)

Internet Marketing + Adelina Eugenia Ivanov,

2012)

Public Relations + (Stammerjohan, Wood,

Chang, & Thorson, 2005)

Integrated Marketing

Communication

+

(Kitchen,2000)

Brand Equity + (Keller, 1993)

Brand Performance + (Wong, 2008)

Customer Relationship

Management

+ (Ekhlassi, Maghsoodi, &

Mehrmanesh, 2012)


CHAPTER 4: RESULTS AND ANALYSIS

CFA Measurements

CFA allows the researcher to test the hypothesis that a relationship between the

observed variables and their underlying latent construct(s) exists. The researcher uses knowledge

of the theory, empirical research, or both, postulates the relationship pattern a priority and then

tests the hypothesis statistically(Suhr, 2001).

The model consists of 9 unobserved variables. There are 5 exogenous variables: Direct

Marketing, Sales Promotion, Advertising, Public Relations & Internet Marketing. There are 3

endogenous variables: Brand Equity, Brand Performance, & Customer Relationship

Management.

Unobserved variables are named. Also, standardized estimates are used to check how

much each item is loaded. The modification indices help us relate error terms to improve the

model.

Confirmatory Factor Analysis (CFA) is used as cut-off criteria by loading each item and

testing item. Factors that had a loading of greater than 0.4 are used for the analysis as this is the

cut- off point.

Items Factors Estimates

Q5

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