Business Communication

CL4 Language and CL4 Language and Culture for BusinessCulture for Business

Prof. Peter CullenProf. Peter Cullen

Moduel III B1Moduel III B1

Business CommunicationBusiness Communication

www.cl4englishlistening.words.comwww.cl4englishlistening.words.com

The Communication Process and The Communication Process and Areas of Business CommunicationAreas of Business Communication

�� Communication is a natural form of social behaviour Communication is a natural form of social behaviour

that is largely involuntary and tied to the very that is largely involuntary and tied to the very

existence of a company expressing:existence of a company expressing:

�� IdentityIdentity

�� ValuesValues

�� Relationships to the outsideRelationships to the outside

�� Information exchange is increasing Information exchange is increasing –– creating creating

background noisebackground noise

Companies and CommunicationCompanies and Communication

�� Companies and their Companies and their stakeholders stakeholders form a process of form a process of significance creation about:significance creation about:

•• Economic and financial valuesEconomic and financial values

•• Ethical and social valuesEthical and social values

•• Commerical valuesCommerical values

•• Symbolic valuesSymbolic values

�� Business and stakeholders are interBusiness and stakeholders are inter--dependentdependent

�� AA business business is a:sociois a:socio--technicaltechnical

partially openpartially open

pluripluri--purpose economicpurpose economic

SYSTEMSYSTEM

Business as a SystemBusiness as a System

�� A A business business is a:is a: sociosocio--technicaltechnical

partially openpartially open

pluripluri--purpose economicpurpose economic

SYSTEMSYSTEM

It is also a:It is also a:

organicorganic

selfself--regeneratingregenerating

relationalrelational

cognitivecognitive

directeddirectedSYSTEMSYSTEM

A Business is a A Business is a vitalvital systemsystem

Companies and StakeholdersCompanies and Stakeholders

�� Stakeholders are people and groups who hold an interest Stakeholders are people and groups who hold an interest

in the existance and performance of a company.in the existance and performance of a company.

Company

Primary Stakeholders

financiersproperty

directors

clients

business partners

competition

suppliers

employees

Secondary Stakeholders

institutions

the public

local community

interest groups

representation groups

The New Competetive EnvironmentThe New Competetive Environment

�� Contributing factors:Contributing factors:

�� economic globalisationeconomic globalisation

�� technological innovationtechnological innovation

�� key factors of the marketing key factors of the marketing

environmentenvironment

�� increasing pressure from increasing pressure from

institutions and civil society on institutions and civil society on

the activities of businessesthe activities of businesses

Economic GlobalisationEconomic Globalisation

�� Promotes the circulation of capital, goods, and Promotes the circulation of capital, goods, and informationinformation

�� Creates uniform purchasing behaviour and Creates uniform purchasing behaviour and economies of scaleeconomies of scale

�� Promotes market interPromotes market inter--dependence and superdependence and super--national marketsnational markets

In terms of strategy:In terms of strategy:

�� The business environment is more complexThe business environment is more complex

�� Competition is stifferCompetition is stiffer

�� There are more variable to controlThere are more variable to control

�� New key factors for success emergeNew key factors for success emerge

Economic GlobalisationEconomic Globalisation

�� This means business communication must:This means business communication must:

•• Face a wider range of agents in the Face a wider range of agents in the

communications networkcommunications network

•• Plan for inceasingly complex interactionPlan for inceasingly complex interaction

•• Develop specifically tailored policies as Develop specifically tailored policies as

well as general strategieswell as general strategies

•• View brand management as an integral View brand management as an integral

policy in the portfolio of strategy optionspolicy in the portfolio of strategy options

company

Group A

Group CGroup B

Technological EvolutionTechnological Evolution

�� Promotes innovation in products and processes, Promotes innovation in products and processes,

inducing a convergent trend in the sector and inducing a convergent trend in the sector and

creating truly new marketscreating truly new markets

�� This can lead to adoption of innovative responses to This can lead to adoption of innovative responses to

market needs (market needs (marketmarket--pull innovationpull innovation) or may lead ) or may lead

to truly new systems of supply (to truly new systems of supply (companycompany--push push

innovationinnovation))

ICTs and eICTs and e--business are changing the paradigmbusiness are changing the paradigm

Company

Market Market

Innovation need

Innovation supply

Marketing EnvironmentsMarketing Environments

�� Concerns:Concerns:�� the evolution of consumption and consumersthe evolution of consumption and consumers

�� the demand for personal and personalised the demand for personal and personalised relationships between client and companyrelationships between client and company

�� increase power to large distributorsincrease power to large distributors

�� branded/unbrandedbranded/unbranded dualismdualism

�� develoment in communicationsdeveloment in communications

Demographic change influences marketsDemographic change influences markets

(population ages)(population ages)

Social change influences markets:Social change influences markets:

Consumption has become a way of expressing Consumption has become a way of expressing values,identity, and individualityvalues,identity, and individuality

The Marketing EnvironmentThe Marketing Environment

�� Today:Today:

Large marketing oriented companies increasingly Large marketing oriented companies increasingly look towards look towards emerging consumer marketsemerging consumer markets –– more so more so than toward than toward mature consumer marketsmature consumer markets

�� Consumers demand greater service and Consumers demand greater service and personalisation in supplypersonalisation in supply

�� Mass production/mass consumptionMass production/mass consumption paradigm is paradigm is outdated outdated –– today production systems focus on the today production systems focus on the technologytechnology--services services paradigmparadigm

�� Rise of Rise of large distributorslarge distributors pushes companies to direct pushes companies to direct marketing strategies and techniques to meet their marketing strategies and techniques to meet their needs needs –– encroaching on brand policy (Selex, Conad)encroaching on brand policy (Selex, Conad)

Institutional and Civil Society PressureInstitutional and Civil Society Pressure

�� Key question: sustainability and sustainable Key question: sustainability and sustainable

developmentdevelopment

�� Social responsibilty of business: companies must Social responsibilty of business: companies must

internalise the objectives of:internalise the objectives of:

city or regional developmentcity or regional development

employment levelsemployment levels

human resources development (training)human resources development (training)

community outreachcommunity outreach

environmental protection (local, regional, environmental protection (local, regional,

global)global)

�� Action groups influence company success in these Action groups influence company success in these

areasareas

i.e. Greenpeace, Consumer Rights Org.i.e. Greenpeace, Consumer Rights Org.

Institutional CommunicationInstitutional Communication

�� MacroMacro--area communication applied to: area communication applied to:

distinctive facets of the company (distinctive facets of the company (vision, mission, vision, mission,

company valuescompany values))

the set of relations created in the contexts of the set of relations created in the contexts of

the organisation, economic competition, social the organisation, economic competition, social

and natural aspectsand natural aspects

�� This communication is differentiated according to This communication is differentiated according to

target group. The company must adopt target group. The company must adopt responsable responsable

and differentiated behaviourand differentiated behaviour BUTBUT

�� Institutional Communication is an expression of Institutional Communication is an expression of

synthesis and sustains the strategic path of the synthesis and sustains the strategic path of the

companycompany

Institutional CommunicationInstitutional Communication

�� MetaMeta--objectives:objectives:

�� To delineate, reinforce, or modify company To delineate, reinforce, or modify company

positioningpositioning –– total imagetotal image

�� Stimulate Stimulate favourable attitudefavourable attitude (consensus) (consensus)

toward the company by its 1toward the company by its 1°° and 2and 2°°

stakeholdersstakeholders

�� Create a climate of credibility, legitimacy, trustCreate a climate of credibility, legitimacy, trust

�� Contribute to the enrichment of the companyContribute to the enrichment of the company’’s s

reputational patrimonyreputational patrimony, in terms of , in terms of goodwill goodwill

(intangible asset)(intangible asset)

Instruments of Institutional CommunicationInstruments of Institutional Communication

�� Public affairsPublic affairs

�� Crisis managementCrisis management

�� ““internalinternal”” communicationcommunication

�� Institutional advertising/promotion (publicity Institutional advertising/promotion (publicity ≠≠advertising)advertising)

�� Public relations (sponsorship etc.)Public relations (sponsorship etc.)

�� Publication of the company balance sheetPublication of the company balance sheet

�� Media relationsMedia relations

�� Consumer relationsConsumer relations

�� Investor relationsInvestor relations

http://www.bp.comhttp://www.bp.com

Institutional Communication at British Institutional Communication at British PetroleumPetroleum

Economic and Financial CommunicationEconomic and Financial Communication

�� Interested parties:Interested parties:

shareholdersshareholders

creditorscreditors

clientsclients

state revenue agencies (fiscal structures)state revenue agencies (fiscal structures)

the financial community the financial community –– particularly when the particularly when the

company is listedcompany is listed

Stricter regulation of balance sheet reporting (after ENRON)Stricter regulation of balance sheet reporting (after ENRON)

Faster flow of financial capital between capital markets =Faster flow of financial capital between capital markets =

Absolute necessity of more, broader, deeper financial Absolute necessity of more, broader, deeper financial

communication with stakeholderscommunication with stakeholders


Investor relations: specialised in relations with Investor relations: specialised in relations with

investors and actors in the financial markets, investors and actors in the financial markets,

particularly analysts and portfolio managersparticularly analysts and portfolio managers

Information needs are:Information needs are:

�� Legislative requirementsLegislative requirements

�� External needs External needs –– of market intermediaries (analysts, of market intermediaries (analysts,

managers etc.managers etc.

�� Internal needs Internal needs –– of interested stakeholdersof interested stakeholders ==

Two levels of communications:Two levels of communications:

�� Basic = Basic = obligatory for financial transparencyobligatory for financial transparency

�� Voluntary = Voluntary = to satisfy stakeholders informational to satisfy stakeholders informational

requirementsrequirements


�� Key Concept: TRANSPARENCYKey Concept: TRANSPARENCY

Financial intermediaries and managers require increasingFinancial intermediaries and managers require increasing

amounts of information regarding companyamounts of information regarding company’’s activities tos activities to

assist clients and investors RISK MANAGEMENTassist clients and investors RISK MANAGEMENT

�� Risk affects investment Risk affects investment –– transparency affects trusttransparency affects trust

government regulation enforces transparency but does notgovernment regulation enforces transparency but does not

guarantee trustguarantee trust

�� Trust is a longTrust is a long--term investmentterm investmentG. Bush at signing of Sarbanes-Oxley Act 2002

Marketing CommunicationMarketing Communication

�� Management of relationship with the market Management of relationship with the market

((intermediate and final clientsintermediate and final clients) aimed at improving the ) aimed at improving the

perceived value of the company and its ability to perceived value of the company and its ability to

meet the needs of selected demand segmentsmeet the needs of selected demand segments

�� Fundamental to Fundamental to marketmarket--driven driven companies to improve companies to improve

defendable competetive advantage and the ability to defendable competetive advantage and the ability to

create value in the mediumcreate value in the medium--long termlong term

�� Two fundamental dimensions:Two fundamental dimensions:

RelationshipRelationship ContentContent

Relationship in Marketing CommunicationRelationship in Marketing Communication

�� Managerial process to create and activate Managerial process to create and activate

relationships involving the business, distributors, and relationships involving the business, distributors, and

endend--users (final clients)users (final clients)

Aimed at: Aimed at: commercial intermediariescommercial intermediaries

(sales reps., wholesalers, purchasing centres, (sales reps., wholesalers, purchasing centres,

retailers etc.) = push strategies involving the retailers etc.) = push strategies involving the

actor who makes the transactionactor who makes the transaction

purchaser/consumerpurchaser/consumer

(the actor who actually uses the good or (the actor who actually uses the good or

service) = pull strategiesservice) = pull strategies

supply side partnerssupply side partners

(research institutes, co(research institutes, co--designers, IT designers, IT

consultants) = relational logic rather than consultants) = relational logic rather than

transactional logictransactional logic

Relationship in Marketing CommunicationRelationship in Marketing Communication

�� Two models:Two models:

mass communicationmass communication

oneone--toto--many transmission of the messagemany transmission of the message

TV, Radio, Newspapers etc.TV, Radio, Newspapers etc.

works with both differentiated and works with both differentiated and undifferentiated marketingundifferentiated marketing

oneone--toto--one communicationone communication

twotwo--way involvement in the messageway involvement in the message

telephone, facetelephone, face--toto--face, other?face, other?

aimed at focused and personalised aimed at focused and personalised marketsmarkets

Content in Marketing CommunicationContent in Marketing Communication

�� The customer is at the centre of the companyThe customer is at the centre of the company’’s interests interest

Marketing involved at transmitting the Marketing involved at transmitting the marketing conceptmarketing concept

�� Production orientedProduction oriented

typical where demand > supply. Needs are obvious.typical where demand > supply. Needs are obvious.

Focus is on distribution rather than communicationFocus is on distribution rather than communication

�� Sales orientedSales oriented

persuasive communication aimed at convincing the persuasive communication aimed at convincing the

market to purchase (if meets real demand need)market to purchase (if meets real demand need)

�� Market orientedMarket oriented

customer satisfaction at the centrecustomer satisfaction at the centre

PV > EV; RV > 0 PV > EV; RV > 0 (PV= perceived value; EV= exchange value; (PV= perceived value; EV= exchange value;

RV= rendered value)RV= rendered value)

Content and Marketing CommunicationContent and Marketing Communication

�� By favouring the point of view of the client rather than the By favouring the point of view of the client rather than the

company, marketing communication becomes one of the company, marketing communication becomes one of the

founding components of services offered to the target founding components of services offered to the target

market market –– creating perceived value creating perceived value product offering.product offering.

�� This allows the client to understand the system of attributes This allows the client to understand the system of attributes

associated with the good or serviceassociated with the good or service

ANDAND

Enriches this system with symbolic structures such as Enriches this system with symbolic structures such as

BRAND IMAGEBRAND IMAGE

Objectives of Marketing CommunicationObjectives of Marketing Communication

�� Economic objectivesEconomic objectives

•• aimed at modifying the demand curveaimed at modifying the demand curve

�� The communication mix stabilises sales over time The communication mix stabilises sales over time

(mitigating seasonal differences)(mitigating seasonal differences)

�� Increase of customer value Increase of customer value (extending customer (extending customer

interaction with the product)interaction with the product)

q1 q2

p1

d1 d2

Economic ObjectivesEconomic Objectives

�� On the supply side, given perfect competition, On the supply side, given perfect competition, there are some particular effects at the sector there are some particular effects at the sector level:level:

Evolution toward monopolistic competition with a Evolution toward monopolistic competition with a large number of competitors and highly large number of competitors and highly differentiated products =differentiated products =

marketing comm highlights diffs.marketing comm highlights diffs.

companies autonomous in pricecompanies autonomous in price

Evolution toward differentiated oligopoly =Evolution toward differentiated oligopoly =

communication produces high communication produces high barriers to market entrybarriers to market entry

increasing sales volume and increasing sales volume and

reinforcing brand loyaltyreinforcing brand loyalty

The only show in town

The business district

Communicational ObjectivesCommunicational Objectives

�� Feedback: crossing the Feedback: crossing the ““perceptivity lineperceptivity line””

�� Subjects apply attention selectivelySubjects apply attention selectively

�� The communications agent must influence the The communications agent must influence the

subjects subjects ““perceptive filtersperceptive filters”” to activate perceptionto activate perception

Objectives:Objectives:

nonnon--behavioural responsebehavioural response

behavioural responsebehavioural response

evaluational responseevaluational response

relational responserelational response


Top of the mind

Unaided recall

Aided recall

Brand recognition

Global brand awareness

Strength of awareness

Cognitive objectivesCognitive objectives

Emotional objectivesEmotional objectives

Communicational ObjectivesCommunicational ObjectivesBehavioural response objectivesBehavioural response objectives

Behavioural Behavioural

responsesresponses

Search for informationSearch for information

PurchasePurchase

ConsumptionConsumption

Word of mouthWord of mouth

Sphere ofSphere of

actionaction

Internal Internal

spheresphere

NonNon--behaviouralbehavioural

responsesresponses

RationalRational

EmotionalEmotional

IdealIdeal


�� Valutative response objectivesValutative response objectives

based on behaviour = a mental state that describes a based on behaviour = a mental state that describes a

subjectsubject’’s relatively stable evaluation of brands, s relatively stable evaluation of brands,

products, companies, ideas, and included rational, products, companies, ideas, and included rational,

emotional, and behavioural components.emotional, and behavioural components.

The learning process shapes behaviourThe learning process shapes behaviour

Communication may influence learning through:Communication may influence learning through:

AssociationAssociation

ReinforcementReinforcement

MotivationMotivation

Communicational ObjectivesCommunicational Objectives�� The Foote, Cone, and Belding modelThe Foote, Cone, and Belding model

IIIIII

IIIIII IVIV

FeelFeel

LearnLearn

DoDo

LearnLearn

FeelFeel

DoDo

DoDo

LearnLearn

FeelFeel

DoDo

FeelFeel

LearnLearn

High degree of involvementHigh degree of involvement

Intellectual Intellectual

learninglearning

Low degree of involvementLow degree of involvement

Emotional Emotional

learninglearning


�� Relational response objectives = constructed from Relational response objectives = constructed from

valutative response basevalutative response base

�� Principal phases of the relational life cycle:Principal phases of the relational life cycle:

�� SatisfactionSatisfaction

�� TrustTrust

�� Behavioural loyaltyBehavioural loyalty

�� Mental loyaltyMental loyalty

�� Loyalty Loyalty

Individual factorsIndividual factorsStructure of needsStructure of needs

Taste and innate aesthetic Taste and innate aesthetic

preferencespreferences

Value systemsValue systems

Consumer characteristicsConsumer characteristics

Situational factorsSituational factorsSocial group influencesSocial group influences

Media used and messages communicatedMedia used and messages communicated

Broader marketing contextBroader marketing context


Relational ObjectivesRelational Objectives

Behavioural Behavioural

objectivesobjectives

NonNon--behavioural behavioural

objectivesobjectives

Influencing factorsInfluencing factors

individualindividual situationalsituational

Valutative objectivesValutative objectives

Flow chart of communications objectivesFlow chart of communications objectives