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Integrated Communications, Integrated Marketing Communications and Corporate Reputation: Evidences From Dell Computer Corporations

This document summarizes an academic research article about integrated marketing communications and corporate reputation at Dell Computer Corporation. The article discusses how Dell practices integrated marketing by segmenting its product portfolio and operating globally. It defines integrated communications and integrated marketing communications, noting their importance for consistency and legitimacy. The role of various promotional techniques in integrated marketing is described. Finally, the concept of corporate reputation is introduced in the context of analyzing Dell's practices and reputation.
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0% found this document useful (0 votes)
66 views

Integrated Communications, Integrated Marketing Communications and Corporate Reputation: Evidences From Dell Computer Corporations

This document summarizes an academic research article about integrated marketing communications and corporate reputation at Dell Computer Corporation. The article discusses how Dell practices integrated marketing by segmenting its product portfolio and operating globally. It defines integrated communications and integrated marketing communications, noting their importance for consistency and legitimacy. The role of various promotional techniques in integrated marketing is described. Finally, the concept of corporate reputation is introduced in the context of analyzing Dell's practices and reputation.
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© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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-Journal of Arts, Science & Commerce ■ E-ISSN 2229-4686 ■ ISSN 2231-4172

INTEGRATED COMMUNICATIONS, INTEGRATED MARKETING


COMMUNICATIONS AND CORPORATE REPUTATION:
EVIDENCES FROM DELL COMPUTER CORPORATIONS

D.M.N.S.W.Dissanayake
Department of Commerce and Financial Management,
Faculty of Commerce and Management Studies,
University of Kelaniya, Sri Lanka

ABSTRACT

Particularly, this case study provides a qualitative assessment of facts with regards to the
marketing efforts of Dell Incorporation (hereafter Dell, Inc.). More precisely the case encounters
aspects with regards to the integrative marketing communication of the desired company. The
report discuss about the integrated marketing communication and the impact it has on corporate
reputation. Moreover a detailed analysis has been given how the Dell, Inc. is practicing integrated
marketing communication at present. The potential to develop an integrative approach with
regards to communication has also being given. Finally the report discusses how integrated
marketing communications practices can be introduced or improved to the company operations.
The implication of the integrated marketing communication with the perspective of finance has
also been illustrated in the report.

Keywords: Corporate Reputation, Integrated Communications, Integrated Marketing Communications

JEL Classifications: M31, O51, M39

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INTRODUCTION:
The Dell, Inc. was formed by Michael Dell in 1984 as PC’s Limited. At the time of the first stock offering took
place the company changed the name as the Dell Computer Corporation in June 1998. The company was able to
commence their business dealings across country boundaries in 1989. The company was able to go outside of
the United States to Europe, and the company was able to achieve $50 million of sales turnover. Adding to that
the concept of segmentation was initiated in 1993 while integrating a consumer concentrated approach. At the
core of the business the company was initiated build-to-order1 strategy. Through this strategy customers were
able to order directly, and their orders were routed by means of a credit check and soon after directly to the
manufacturing. Finally the orders were then built, tested and eventually shipped to the customer. Adding to that
the consumers were able to receive the order 5-7 days after the order was taken place.
These strategies were able to reap rich harvest to the company. At the very first beginning the company took
steps to reduce the middle man. This strategy was basically formed in order to reduce cost. By implementing
this strategy the company was able to pass the benefit to the consumer while reducing the cost of the product.
By identifying the customer need the company was able to position their value proposition in a sound manner.
Further Dell practiced just-in-time manufacturing as well. Finally they achieved impressive results and gained a
competitive advantage.
Moreover, the company’s product portfolio is diverse. The company has implemented various categories for the
each segment of the market. Those are, for home, for small home and office, for small and medium business, for
education, government and healthcare and for large enterprises. Sub categories have applied for each main
segment. These strategies are vital for the company’s success.
The company has developed their grassroots across the globe. In almost every country the product is available
for consumers. Mainly, the company operates in countries like, US, Canada, Mexico, Brazil, France, Germany,
Italy, India, China, Japan, Malaysia and Australia.

THE CONCEPT OF INTEGRATED COMMUNICATION:


Marketing organizations are increasingly paying an emphasis on integrating their messages, procedures,
communications within their formal organizational boundaries, (Christensen, Fırat & Torp, 2008). Adding to
that, it implies a formal centralized approach within the organizational boundaries. Thus Christensen, Fırat &
Torp, (2008) asserted some potential disadvantages of a formal centralized approach in an organizational
perspective. In fact, integrated communication is an important issue in marketing as well, (Christensen, Fırat &
Torp, 2008). Improper alignment among messages, procedures, and communications in an organization will
potentially impact on sub-optimization of communication budgets, (Smith, 1996). In a clustered market, it is
impossible to stand in a position without clarity, consistency and continuity among distinctive brands, (Duncan,
2005; Knox and Bickerton, 2003; Shimp, 2003). Moreover, organizations cannot be considered as a legitimate
player without a consistency among messages, words and behaviours, procedures and deeds, (Balmer, 2001;
Gioia et al., 2000; Schultz and Kitchen, 2000). Therefore, given all fact above conveys one to understand the
importance of integrated communications. Under the headline of integrated communications, various scholars
increasingly talk about Integrated Marketing Communication (hereafter IMC) programs with the perspective of
organizations, (Schultz et al., 1994; Duncan and Caywood, 1996; Schultz and Schultz, 2003).
The notion of marketing communication has historically been measured in terms of a medium-by-medium basis,
(Ewing, 2009). The concept of IMC can be defined as a process of comprehensive plan which adds value for number
of strategic roles number of communication disciplines. For an instant, direct response, general advertising, public
relations, and sales promotion and these combines in order to provide clarity, public communication impact and
consistency, (Schultz et al. 1993, p. 6). Meanwhile, Pride & Ferrel, (2006) defines IMC as a process where the
organization of promotional aspects and other marketing related efforts to satisfy the maximum persuasive and
informative impact on customers. Further, it also can be defined as a combination of direct marketing, general
advertising, sales promotion and public relations, (Jones & Schee, 2008). For an effective marketing strategy, IMC
approach is plays a major role, (Anderson & Vincze, 2006). A broad view, (Scott, 2001) and interdisciplinary
approach (Everett, Siegel, & Marchant, 1999) was also were emerged as new dimensions of the IMC.
The eventual role of the IMC is to convey a consistent message to customers, (Pride & Ferrel, 2006). Given the
fact, it can be stated that, though some organizations implement promotional efforts to educate consumers,
customers have not always conveyed a consistent message. Thus properly planned IMC aspects are required.
Effective IMC approaches foster companies to effective utilization of promotional resource and to build longer
term sustainable consumer relationships.

1
Customization of products
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The concept of IMC is increasingly accepted by many firms due to number of advantages. The mass media
advertising was considered as viable at past. But the techniques considers as ineffective since the high cost
involved and the unpredictable target audience. Today, firms use precisely targeted promotional techniques such
as direct mail, cable TV, the internet, etc. today almost all companies seek for effective implementation of
information technology in promotional aspects. These new initiatives of information technology have foster
buyers and sellers to share and to promote an effective customer relationship management.

THE ROLE OF PROMOTION IN INTEGRATED MARKETING COMMUNICATIONS:


Promotion is the process where building and maintaining relationships by persuading and informing one or
more audiences, (Pride & Ferrel, 2006). The firm could implement various promotional efforts to achieve
promotional objectives and to stimulate demand of the product. To achieve this end, companies tend to utilize a
considerable level of resources on promotional efforts. This is to enhance relationships among existing and
potential consumers.

THE CONCEPT OF CORPORATE REPUTATION:


Among the corporate, reputation is a topical in context, (Fombrun, 1996). Though the corporate reputation has
been accepted by many companies, a precise definition of the concept is lacking, (Barnett, Jermier & Lafferty,
2006). Nevertheless, Fombrun and van Riel (1997), defined the idea of reputational landscape as chaotic and
barren. Adding to that, the idea of corporate reputation is considered as a valuable source which is generating
the stakeholder support, (Fombrun & Pan, 2006). Further, it is considered as an intangible asset which is
creating goodwill for the company, (Fombrun and van Riel, 2004). Based on a research done by the Reputation
Institute in 1997, they were able to postulate that the notion of corporate reputation can be represented by a
standardized measure depends on a limited questions asked from respondents how are reasonably familiar with
the company, (Fombrun and van Riel, 2004).
The idea of corporate reputation is comprises with three elements. This is also known as reputational radar. Three
elements are, brand, stakeholder and organizational reputation. The brand recognition is indeed, how people may
perceive a particular brand. Organization reputation is all about what the entire public think about the company as
be in opposition to a particular brand. Finally, the stakeholder reputation talks about the reputation for a particular
brand among stakeholders. Integrated communication and its impact on corporate reputation.
Given all the illustrations pertaining to IMC and corporate reputation, one could simply identify that there is a
link among two concepts. This is because, IMC approaches are definite aspects to be effective, and once the
company being come to an effective scenario, it may lead to enhance the corporate reputation. This illustration
provides a review of relevant literature with regards to the corporate reputation and how integrated
communications helps to develop corporate reputation. Kennedy (1997) postulated that the idea of corporate
image could be formed and disseminated within the organization. The basic premise in this regard is to make
focus on attention to the task that they are engaged with. And to build a corporate reputation all the employees
are required to consider it as an obligation to be achieved. A seminal paper on building the corporate reputation,
suggested that a sound mission, mortality and modes are vital to prosper, (Dowling, 2006). Christensen and
Torp, (2008) asserted that organization wide is a necessary fact to build a corporate reputation. A founding
article for the concept of corporate reputation is proposed by Abratt (1989). He distinguished among the
developments of corporate image, identity and philosophy. Eventually he formed a model for development of
the corporate image from the perspective of stakeholders. Besides, Welch and Jackson (2007) postulated a
concept name as internal communications matrix which can be utilized as an integral part of strategic planning
to achieve corporate objectives. Moreover, the concept of strategic credibility was postulated by Higgins and
Bannister (1992) in order to enhance the organization’s strategic image. Adding to that, the theory of image
restoration was affirmed by Benoit (1997) to understand about the crisis of the organization. He identified five
approaches to repair, which are namely, denial, evade responsibility, reduce offensiveness, and use corrective
action and mortification. Finally, Bruning and Ledingham (2000) asserted the perceptions the public have of the
professional, personal, and community relationships they have with companies. The authors stated that the
ability to encourage effective dialogues could possibly enables true relationships.
Above illustrations with regards to various topics in corporate image provides an insight relates to how an
organization could achieve corporate reputation. Though above evidences are not directly relate to achieve
corporate reputation, it can be stated that above findings are an integral part of attaining corporate reputation.

AN ASSESSMENT OF INTEGRATED COMMUNICATIONS OF DELL COMPUTER INC:


Numbers of tools are available to identify the extent the implementation of IMC approaches for a company.

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Followings are some of them. Personality audit Identity audit (acid test), SH analysis, Identity Mix Audit (with
a detail com- audit), CSR audit, Sevequal (service gap audit for gives image/communication/behavioral gaps),
Brand audit and Image research. The notion of personality audit defines the extent of a person may interact with
other people, (kdvi.com, 2012).
The identity audit is used to detect segregation of duties violations, (oracle.com). When determining strengths
and weaknesses of a desired brand, brand audit is vital. It requires mind mapping which is an organic technique
in deciding the correct position of the organization, (Brand, 2004).

INTEGRATED COMMUNICATIONS OF DELL COMPUTER INC:


Communication is the process where different meanings are exchanged among people through a common set of
symbols. Further, if a company develops a new product, or implements an alternation to the product, or simply
tries to increase sales, should be communicated to the target group of buyers by means of a proper channel. So
therefore markers could possibly adapt different promotional aspects to convey the product to consumers.
Basically, communication can be divided into two categories, namely, interpersonal communications and
interpersonal communications and mass communications. The company Dell is a successful company, and the
company was came to know that the company is moving away from mass media advertising technique to
implementation of direct marketing efforts. Adding to that, the marketing audit of the company is illustrated the
move to direct marketing technique has led the company to implement a successful integrated marketing
communication plan.
When it comes to Dell’s IMC approaches, general advertising efforts are general. The company highlights
advertisings on television which is having minimal direct responses. The company’s direct marketing efforts are
also vital in IMC perspective. The company is frequently engaging in catalogs and proving sponsoring into
various business dealings. When it comes to sales promotion efforts the company’s limited time and special
packages play an important role. Finally, when it comes to public relations approach the company intensively
utilizes outdated computers to help through the foundation of Christina.
The effort of coordination seems to be extensive at Dell. The top management team consists with 16 executives
who meet regularly. They discuss about everything relates to the strategy of the company, and new product
initiatives. By doing this, they expect the notion of optimization and empowerment. The integrated
communications provide a definite backup for the effective smoothing among the operations and coordination
of the organization. A greater emphasis has been given on efforts on helping people to find information and not
just for communication of information. The effort of coordination is done via extensive communications over
the intranet. John Cone, the vice president of Dell Learning postulated that the intranet facility is one of the
basic communication tools for the senior executives of the organization. Michael Dell stated that
communications assisted to the organization in a variety of forms. They have achieved a huge success of these
new initiatives in integrated communications. Besides, he stated that, by means of strong communications, the
company has able to transform their employees into a championship team. Moreover the chairman at Dell
affirmed that the communication can be describes as, transaction consumers do not purchase frequently, and
often need a high volume with a relatively low-value assistance. But when it comes to large customers who buy
very frequently need a limited service, but the support required is customized and high-value add.
The notion of zero-time organization has been able to build a culture which empower and align employee at
Dell. Dell was able to achieve this by means of extensive integrated communications. Besides, employees are
empowered since they are selectively hired via Dell University training programs and systems which directly
link to incentive systems to motivate employees. For an instant, the people in production have linked objectives
which are graded through incentives and metrics based on individual and team performances.

THE POTENTIAL TO DEVELOP AND ESTABLISH INTEGRATED COMMUNICATION WITHIN


THE ENVIRONMENT OF DELL:
The potential to initiate a more flourished ingrate communications approach is affirmed by the concept of
“common starting points” (hereafter CSP) in an organization. The idea of CSP defines the framework to
implement as a solution for the challenge of balancing the flexibility and integration in the organization,
(Christensen, Fırat & Torp, 2008). Establishing CSP functions are more important to implement and to establish
an effective communication within the organization, (Van Riel, 1995, pp. 19f). in addition to CSP organizations
require two more approaches to establish an integrated approach of communications, these are namely,
Common End Points (CEP) and Common Process Rules (CPR), (Christensen, Fırat & Torp, 2008). To initiate
an integrated communication a balance between centralization and decentralization of organizational integration
is required, (Christensen, Fırat & Torp, 2008). This can be graphically depicted as follows.

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Figure 01: Centralization and Decentralization of Organizational Integration:

Source: Christensen, L. T., Fırat, A. F., & Torp, S. (2008). Emerald article: The Organization of Integrated
Communications: Toward Flexible Integration. European Journal of Marketing.

Adding to above illustrations, the notion of corporate level marketing is also another important aspect to
enhance the potential of developing integrated communications, (John & Stephen, 2006). One of the key
attributes of developing the corporate level marketing is to concern with the multiple exchange relationships
among networks and stakeholder groups. Further another important dimension in this regard is temporal
dimension with regards to relationships, (John & Stephen, 2006).
Ability to integrate communication is powerful competency and it will be fundamental in building /altering the
reputation of an organization. The absence of ‘integration; could result in obvious confusion on the reputation.
The potential to IC will depend on areas factors such as, Availability of a corporate brand, Drivers supporting a
corporate brand, Stakeholder expectation diversity, Current context of image (clarity vs. Confusion),
Communication expertise and Structural context (marketing structure/Degree of centralization etc.). Following
illustration provides an analysis of the potential of implementing integrated communication with reference to
the above factors mentioned.

AVAILABILITY OF THE CORPORATE BRAND AT DELL:


For a company the brand asset is considered as hard to build, maintain and to adapt, (Aaker, 2004). Because of
the proliferation of brands and products the offering environment is confused and cluttered. In this regard the
notion of corporate brand is considered as vital in the brand portfolio. The corporate brand can be described the
company that will bring and stand at the back the offering that the customer will buy and make use of it, (Aaker,
2004). In the case of the company Dell, where the item for consumption brand consists largely of the corporate
brand plus a descriptor. Given that fact, one could identify, that the use of corporate brand leverages synergy
and clarity of the company’s operations. Theoretically, the notion of corporate brand potentially encompass a
wealthy heritage, capabilities and assets, values people and priorities, global and a local frame of reference,
programs of citizenships, and performances records of the company, (Aaker, 2004).
Company Dell encompasses a heritage which starting since 1984. The Dell, Inc. was formed by Michael Dell in
1984 as PC’s Limited. At the time of the first stock offering took place the company changed the name as the
Dell Computer Corporation in June 1998. The company was able to commence their business dealings across
country boundaries in 1989. Therefore one could identify that the company is consists with a heritage to create a
massive corporate brand. Firm assets and capabilities bring an organization to deliver innovative products to the
market. Having diverse human and physical capabilities the company Dell has gained a competitive advantage
over competitors. To deliver a corporate brand people aspect is considered as vital. People of Dell all have a
distinct personality which assists to define the more effective corporate brand for the company. The company
Dell has prioritized their services to customers. They have implemented a very effective supply chain
management system to serve to the customers more effectively. The on time delivery is accomplished through
the supply chain. Consumers have the ability of accessing and ordering the products online. The company’s
innovative capabilities are also another vital aspect in this regard. To position the company’s value proposition
they constantly engaging in innovative initiatives. Perceived quality of the company is also another dominant

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factor to survival and for corporate brand. Dell has ensured the reliability of the products offered. The products
are trustworthy for consumers of Dell.

SIGNIFICANCE OF LEVERAGING THE CORPORATE BRAND:


The concept of corporate brand unambiguously and explicitly reflects from its products and the company itself
(Aaker, 2004). Adding to that, corporate brand assist the consumers to differentiate, to create brand credibility
and facilitates brand managements. Eventually it supports communications and provide ultimate brand house.
The significance of leveraging the notion of corporate brand is useful since, it help differentiation among the
organizational associations, (Aaker, 2004). Secondly corporate brand assist companies to energize each product
brands. Providing sponsorships could possibly assist companies to leverage corporate brand as well. Thirdly
corporate brand provide credibility. Finally, the corporate brand assists companies to develop meaningful
relationships among communities and among corporate. However the product brand is also same as the concept
of corporate brand in another context. Adding that, though there is significance in leveraging corporate brand,
there are some challenges can also be identified. Firstly, the sustaining relevance, creating and positioning the
value proposition, challenges in managing negative associations, and finally the challenge of making the
corporate brand happen, (Aaker, 2004). Summering all the facts elaborated above one could graphically
illustrate the potential and challenge of corporate brand as follows.

Figure 02: Challenges and The Potential Impact of Corporate Brand:


Corporate brand
• Heritage
• Assets/ capabilities
• People
• Value/ priorities
• Local/ global
• Citizenship
Challenges
• performances
• Maintaining
relevance
Potential impact
• Creating value
Organizationally based differentiation •
Corporate programs as branded energizers
• propositions
Credibility
• • Avoiding visible
negatives
More effective management of the brand

• Managing the
portfolio
brand across
• Support for internal brand building
contexts
• Provide the ultimate branded house
• Making the brand
identity emerge
NEW REALITIES IN INTRODUCING, IMPROVING INTEGRATED COMMUNICATIONS FOR
DELL COMPUTER INC:
Particularly this section clearly defines some recommendations to enhance integrated communications efforts
and to eventually achieve a successful long term business potential. Some of the main recommendations
addressed in this section are to enhance public relations, to introduce story telling approach, restructuring the
marketing function to enhance the integration communications efforts, to introduce a core message for
communication purposes, and finally, realigning symbols of the company.
In the perspective of management, public relations can be defined as a function which is establishing and
maintaining mutual beneficial and meaningful relationships among an organization and the public, adding to
that, the success or the failure of meaningful relationships depends on the public’s perception and relationships,
(Cutlip, Center and Broom 2006). Importantly, most of the time company’s used to engage with community
building web sites like Face Book and Twitter. But when it comes to Dell, the company’s PR activities via
community building web sites are less. It can be recommended to implement such an approach to enhance
effectiveness and those suggestions have recommended by Jones (2011) as well. Moreover, the company’s

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relevant business processes can be restructured effectively. Some of the research and development initiatives are
vital for this task. The marketing function of the company can be restructured via effective research and
development initiatives. This will lead to further increase the company’s effectiveness and eventually to
operating and gross profit margins. Moreover to protect profitability challenges of the company acquisition and
continually supply chain adjustments are vital. These initiatives have also been suggested by (Macomber, 2012).
Though the company’s customer satisfaction rates are improving, Cass, (2007), it should be stated that above
strategies could be implemented to enhance integrated communications in the company.

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