MARKETING COMMUNICATION PLAN
Case DNA Finland Ltd: How to Gain More Russian Prepaid
Subscription Customers?
LAHTI UNIVERSITY OF APPLIED
SCIENCES
Degree Programme in International Business
Thesis
Spring 2009
Jenni-Mari Laitinen
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Marketing Plan for DNA Finland: Attracting Russian Prepaid Subscribers, Study notes of Marketing
A marketing communication plan for DNA Finland Ltd to gain more Russian prepaid subscription customers. It covers the background of the research, objectives of the thesis, limitations, structure, marketing in general, marketing communications, and marketing communication planning. The document emphasizes the importance of marketing communication as a part of the marketing mix and introduces various marketing communication methods and strategies.
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MARKETING COMMUNICATION PLAN
Case DNA Finland Ltd: How to Gain More Russian Prepaid
Subscription Customers?
LAHTI UNIVERSITY OF APPLIED
SCIENCES
Degree Programme in International Business Thesis Spring 2009 Jenni-Mari Laitinen
Lahti University of Applied Sciences Degree Programme in International Business
JENNI-MARI LAITINEN: Marketing Communication Plan Case DNA Finland Ltd: How to Gain More Russian Prepaid Subscription Customers?
Thesis for International Business 61 pages, 5 appendixes
Spring 2009
ABSTRACT
This thesis is about marketing communications. The objective is to define the parts, which especially need to be considered in the functional and cost-effective promotion planning process, and then apply these features to the case company’s plan. The research question tries to solve the problem on what the case company must observe in their promotion process when trying to gain more Russian prepaid subscription customers.
The study is divided into theoretical and empirical parts. The theory part introduces marketing on a general level; marketing planning, the marketing mix, the 4P model and the basics of the marketing communication. Promotion planning is handled stage-by-stage by using the MCPF theory. The empirical part applies theory to practice by developing a marketing communication plan for the case company.
The research offers feasible ideas to accomplish promotion towards the target segment. Therefore it is not to be a precise and detailed plan. Only prepaid subscriptions and consumers are handled.
The qualitative study consists of multiple methods. The information is gathered widely from different marketing and marketing communication textbooks, magazine articles, web pages and by interviewing representatives of the case company.
Marketing communication planning process is a versatile process, which requires many resources from the company in order to be executed successfully. This study offers the theoretical framework and an empirical paradigm for the person who operates with marketing communication process. The result of the study is the marketing communication plan for the case company. It helps the implementation of the planning process and offers comprehensive information about the subject.
Key words: marketing communication, marketing communication planning, intercultural promotion, DNA Finland Ltd
TABLE OF CONTENTS
- 1 INTRODUCTION
- 1.1 Background for the Research
- 1.2 Objectives of the Thesis and the Research Question
- 1.3 Limitations of the Study and the Research Methods
- 1.4 The Structure of the Thesis
- 2 MARKETING IN GENERAL
- 2.1 Strategic Marketing Planning
- 2.2 Marketing Mix
- 2.2.1 4Ps: Product
- 2.2.2 4Ps: Price
- 2.2.3 4Ps: Place
- 2.2.4 4Ps: Promotion
- 3 MARKETING COMMUNICATIONS
- 3.1 The Aim of Marketing Communication
- 3.2 The Promotion Tools
- 3.2.1 Advertising
- 3.2.2 Sales Promotion
- 3.2.3 Public Relations
- 3.2.4 Personal Selling
- 3.2.5 Direct Marketing
- 3.3 The Message
- 3.4 Intercultural Marketing Communication
- 3.5 Developing an Effective Promotion
- 4 PLANNING MARKETING COMMUNICATIONS
- 4.1 Context Analysis
- 4.2 Promotional Objectives
- 4.3 Promotional Strategies
- 4.4 Budget and Other Resources
- 4.5 Schedule
- 4.6 Control and Evaluation
- PLAN 5 CASE DNA FINLAND LTD: MARKETING COMMUNICATIONS
- 5.1 Context Analysis
- 5.1.1 Company Analysis
- 5.1.2 Competitor Analysis
- 5.1.3 Segment Analysis
- 5.1.4 Environmental Analysis
- 5.2 Promotional Objectives
- 5.3 Promotional Strategies
- 5.3.1 Print, Outdoor and Radio Advertising
- 5.3.2 New Media
- 5.3.3 Sales Promotion
- 5.3.4 Customer Care in Russian
- 5.4 Budget and Other Resources
- 5.5 Schedule
- 5.6 Control and Evaluation
- 6 CONCLUSIONS
- 7 SUMMARY
- REFERENCES
- APPENDICES
networks. The plan offers ideas for the case company, which they can apply in their marketing communication towards the target market. The aim is not to create a detailed marketing communication plan, but instead to offer applicable and cost- effective ideas.
In order to gain more Russian customers, the plan must emphasize the target market’s cultural features. The attention of the segment must be captured and therefore the promotional methods and implementation locations are selected carefully.
The research question defines what kind of marketing communication plan the case company needs in order to gain more Russian prepaid customers. Since the plan is directed to foreign customers, the cultural features must be considered.
1.3 Limitations of the Study and the Research Methods
This thesis offers an idea for the case company on how they could promote the product in the target market. Overall, the marketing communication plan for the company is created on a general level and the final campaign design is left to the company to plan.
This study focuses only on prepaid subscriptions and not to postpaid subscriptions and international roaming. It is very hard to affect on consumers' behavior when they use postpaid subscriptions due to partnerships with networks. By co- operation, networks can provide lower prices to their customers. Prepaid subscriptions can be obtained from many places and they are secure choices, as their pricing is always clear and all the costs are known and paid beforehand. Furthermore, only consumers are handled.
The characteristic feature of prepaid subscriptions is that the call time is paid in advance. This thesis refers prepaid subscriptions generally as “prepaids”. When a certain product is emphasized, e.g. DNA Prepaid, the exact name is mentioned.
This study is done by using different marketing textbooks, Internet pages and other materials. In addition, DNA’s representatives have been interviewed. During January 2009, DNA Finland Ltd’s Head of Roaming Kimmo Martikka and Marketing Planner Pia Lindroos were interviewed in the company’s headquarters in Vantaa. They provided some very valuable ideas and information on the subject.
1.4 The Structure of the Thesis
The first chapter of the study is an introduction. Second part concentrates on marketing in general, marketing planning, the marketing mix and the 4P’s theory. Marketing mix model is introduced fairly largely as it is widely taught and used. The third section is about marketing communication theory and some special features of promotion are introduced.
The fourth chapter concentrates on marketing communication planning. This part explains the marketing communication planning framework (MCPF), which is also applied in case company’s plan.
The empirical marketing communication plan can be found in the fifth chapter. The sixth part introduces the author’s conclusions about the study and the seventh chapter is a summary of the research.
2.1 Strategic Marketing Planning
There must always be a strategic plan to accomplish marketing. Often used framework first defines mission, vision, values, organizational goals and organizational strategy (Baines et al.2008, 176). When these factors are understood and defined, the functional marketing plan can be developed.
The vision refers to the organization’s future and it is a statement of what the company wants to become. The mission is the company’s long-term achievement. It usually defines the organization’s purpose and direction. Values define the behavior culture inside the company and goals represent the outcomes of the company’s various activities. Organizational strategy brings together human resources, logistics, production, marketing, IT and financial parts of the company that support accomplishing organizational goals. (Baines et al. 2008, 176-178.)
Overall marketing should support and contribute to the company’s strategy. Strategic marketing planning is a formal written document that specifies the accomplishment of the company’s strategy. It is also a basis for the marketing mix and marketing communication planning. The process is demonstrated on the following Figure 1. (Baines et al. 2008, 180.)
Figure 1. The Relationship Between Corporate and Marketing Strategies (Baines et al. 2008, 180; Simplified version, completed by the author of the thesis)
2.2 Marketing Mix
Neil Borden developed the term marketing mix in late 1940s and in 1964 it was published in his article “The Concept of the Marketing Mix”. He begun to use the term in his teachings after James Culliton had described the marketing manager as a “mixer of ingredients”. These ingredients in Borden’s marketing mix were product planning, pricing, branding, distribution channels, personal selling, advertising, promotions, packaging, display, servicing, physical handling, fact- finding and analysis. (NetMBA.com 2002-2007.)
Later, in the 1960s Jerome McCarthy developed the 4Ps theory. It was simplified marketing theory, when compared to the marketing mix. The 4Ps theory includes product, price, place and promotion. Despite of the simplicity of the 4Ps theory,
Mission, values and goals Decided activities Allocated resources
Corporate Strategy
Marketing Strategy Selection of target markets and segments Selection of marketing mix Implementation and evaluation
Brand naming is a strategic issue for the company. The brand name can not be launched without thinking of the long-term influences effects the name. Once launched, the name can not easily be changed afterwards.
Brand naming serves not only the buyer, but the seller, too. Without a brand name or trademark, the customer has difficulties to separate similar products. Further, it can be hard to remember which product had previously best fulfilled their need without a sharp and effective brand name.
There are few terms, which should not be mixed: brand, brand name, brand mark and trademark. In the spoken language, these are commonly used as synonyms. However, there are significant differences between the terms.
Lahtinen et al. (1999, 135) explain that a brand can be any name, term, symbol, format or design, or the combination of the previous ones. The main point to remember is that a brand separates and identifies the producer or the seller of the product from similar ones. (Lahtinen et al. 1999, 135.)
A brand name, however, is the brand’s spoken or written part. A good name can add a product’s popularity. The brand name must also be protected in order to prevent others to use the name in the future.
Furthermore, a brand mark is a unique symbol. Some products are known by their symbol or picture; e.g., Mercedes Benz is known by the star and Coca Cola by the white font on the red background. A logo is a unique way to write the company’s or the product’s name. A trademark is a legally protected brand name or brand mark. It can be formed by a word or words, letters, numbers or it can be a combination of all the previous ones. (Lahtinen et al. 1999, 136.)
Brands are more than names and designs. They are highly powerful assets, which must be maintained, developed and managed carefully. Brands represent consumers’ thoughts about the product and its performance.
Not only brand name, but also quality, is an important measurement of the product. First, the quality must be excellent, and furthermore, the customers must confirm the quality. The level of a quality is very subjective and therefore formed by the customers’ vision. A low quality is a huge expense for the companies. It is calculated that sales deductions due to low quality products, fixing and adjusting errors, rejecting erroneous products and handling claims are approximately 35 per cent of the turnover. (Lahtinen et al. 1999, 146.)
Market segmentation is dividing large and heterogeneous markets into smaller groups that can be reached more efficiently by their unique needs (Kotler et al. 2006, 195). Segmentation must be accomplished carefully in order to find the potential customer groups and to focus marketing especially towards them.
After segmentation, the product must be positioned. Positioning is visualizing the product within the target audience. The goal is to clarify which reasons assign audience’s choices. (Opetushallitus Etälukio 2009.) The aim is to make audience to choose the product from the mass of competitors’ similar products.
There are some excellent examples of successful positioning. For instance, Volvo is recognized worldwide as a safety family car. This derives from executive positioning. BMW, on the other hand, has been positioned for the target audience, which requires sexy and sporty car.
2.2.2 4Ps: Price
Price was some decades ago the major factor affecting on the product choice. Later other factors gained more important roles in the buyer’s behaviour. It is good to bear in mind that price is the only element which produces revenue in the marketing mix. Therefore pricing must be controlled and considered carefully. Price can also change quickly due to economic fluctuations. Pricing must also cooperate with product design, distribution and promotion decisions. (Kotler et al. 2004, 309.)
2.2.3 4Ps: Place
The products, which have been produced, must also be made available for the customers. This path is called a supply chain or a distribution channel. Kotler et al. (2004, 360) explains that a supply chain consist of upstream and downstream partners. Upstream partners include raw material, component and information suppliers, in other words all of the suppliers, which are needed to produce or manufacture something. Downstream partners look towards the customer; including wholesalers and retailers. Downstream partners are the link between the seller and the buyer. (Kotler et al.2004, 360-361.)
Companies often pay too little attention to their distribution channels. However very few producers sell their goods direct to customers and this emphasizes the importance of the supply chain. In addition, company’s distribution channel decisions have a direct effect on other marketing decisions. Distribution channel decisions usually involve with long-term partnerships with other firms. (Kotler et al.2004, 361.)
The right channel needs to be selected carefully and purposefully in order to gain maximum effectiveness. According to Kotler et al. (2004, 372), channel designing include customer need analyzing, setting channel objectives as well as channel alternatives identifying and evaluating. The company must analyze what the target consumer is willing to do in order to obtain the product. It is also important to define what the customer requires from the channel. Usually, for example, if the product can be obtained nearby, the price is higher and vice versa. Therefore, there must be a balance between consumer needs and price preferences. Consumers often accept lower service level in exchange for lower prices. (Kotler et al.2004, 372.)
Channel objectives are to be set due to a company’s and product’s nature. They are set in order to gain certain level of customer service. Regarding Kotler et al. (2004, 372), the company can identify several segments wanting different levels
of service. Then the decision, which segments are to be served and which channels are to be used in each case, are done. Channel objectives are influenced by the nature of the company and its products, its marketing intermediaries, competitors and the environment. (Kotler et al. 2004, 372.)
The next step in the company’s supply chain designing is to identify the best suitable channel alternatives. Then the types of intermediaries and number of intermediaries and each channel members’ responsibilities are set (Kotler et al. 2004, 372-373).
2.2.4 4Ps: Promotion
Marketing is not just developing an innovative product, pricing it attractively and making it available for customers. The product must also be made known for the potential customers. Marketing communication is therefore a vital part of the marketing mix.
Marketing communication, or promotion how it is also called, is one of the competitive advantages of marketing mix. Furthermore, the marketing communications methods include advertising, sales promotion, public relations, personal selling and direct marketing. However, when thinking of promotion, customer service and web marketing must also be taken under consideration. (Lahtinen et al. 1999, 211.)
According to Lahtinen et al. (1999, 210-211), marketing communication is divided into informative and suggestive parts. Informative communication describes the product and the price in order to decrease potential customers’ suspense. Suggestive communication attempts to affect on customers’ attitudes by emotional methods. Marketing communication will be stressed in more detail in the following chapter. (Lahtinen et al. 1999, 210-211.)
within print class there are magazine and newspapers. (Fill 1999, 302.) Common feature is that the media conveys the message to target audience.
When these three elements, the tools, the media and messages are combined, the result is called integrated marketing communications (IMC). It has become a popular approach within organizations and their communication agencies, as it is very media-orientated. In the future IMC is probably to become an established marketing theory. (Baines et al. 2008, 450.)
In order to execute marketing communication effectively, it is good to notice the main features of communication. According to Kunelius (2003, 13) the term communication is formed by the words confirmation and to inform. Confirmation refers to an occasion when someone is taken a part of the community. Informing refers to the delivery of messages. That is why communication always require the audience and the message. (Kunelius 2003, 13.)
Overall, communication is a process by which individuals share meaning (Fill 1999, 23). Although it may sound simple, that is not the whole truth. Communication is a complex transmission process.
Communication requires always a sender and a receiver. Additionally it is dependent on the social context in which it takes place. There must also be a clear and unobstructed route to deliver the message. There might be distractions in the channel, which may disturb the understanding of the message. Lastly, feedback is to be given immediately. (Smith, Berry, Pulford 1999, 21.)
3.1 The Aim of Marketing Communication
Marketing communication has two principal aims. First is to develop brand values by using advertising to set up feelings, to create visions and to improve beliefs. The second is to make customers behave particular ways. Target audience is made to behave in a beneficial way in order to make then buy the product use the service. (Baines et al. 2008, 443.)
Successful marketing communication has three obstacles to overcome. Firstly, the message must be delivered in a way that the audience is able to notice it. Next, full attention of the audience must be achieved and message must easily be processed and understood. (Idman, Kämppi, Latostenmaa, Vahvaselkä 1993, 25.) The goal is to deliver consequences, feelings and certain atmospheres in order to awake wanted visions or patterns of behave.
3.2 The Promotion Tools
This chapter introduces the promotion tools. Each tool has unique characteristics and costs. These characteristics must be considered carefully when selecting the compatible tool. Even within a same field of industry, applicable tools vary a lot. For example in a cosmetic field, Yves Rocher concentrates on direct marketing while L’Oreal spends heavily on consumer advertising.
3.2.1 Advertising
Advertising is paid, impersonal communication focused simultaneously on a big audience conveyed by mass medium or other channels (Vuokko 2003, 193). International advertising rules defines that an advertisement must be recognized as an advertisement. In print media, for instance, an audience must be able to understand when something is about marketing and when about a factual article.
As described, advertising is impersonal communication and there is no personal contact between information receiver and sender. Therefore, there must be a channel, or media, which conveys the message to the receiver. This channel can be a television, a radio, an Internet, a magazine or any kind of billboard for instance. The message can also be conveyed directly via text message or e-mail. (Vuokko 2003, 193-194.)