The marketing environment has in the past two decades changed dramatically. The Internet has given businesses of all sizes the opportunity to compete throughout the world with brands of seemingly similar quality, and to promote their wares in ways previously unimagined. Simultaneously, media fragmentation and the overarching need for cost-effective and efficient marketing has changed the way marketers conduct and evaluate their marketing and marketing communications activities (De Pelsmacker et al, 2004).

This research explores the emergence, relevance and applicability of marketing communications/Integrated Marketing Communications (IMC) within SMEs in Iceland and if marketing communications activities are affected by organisational culture. Iceland was chosen because prior to this research, its economy was in stage of growth and substantial proportion of GDP was derived from SME activity. In order to answer the objectives, a mixed methods design was used in which senior managers in SMEs were interviewed in the first phase and surveyed, via a questionnaire, in the second phase.

The findings confirmed and corroborated the previous literature regarding SMEs as managers were found to be using mostly traditional advertising methods. The results also showed that they were not using systematic methods when planning, budgeting or  measuring their marketing communications activities. However, some findings were contradictory as managers were also found to be gathering information about their customers and appeared to be interested in what was happening in their field of business abroad. The research discovered that IMC was not regarded as important by the managers. Findings from the first phase gave foundation for the belief that a traditional culture may be a barrier towards marketing and marketing communications practise. Therefore, eight hypotheses were developed and subsequently tested in the second phase of the research. The findings offered an indication that hierarchy culture could act as a barrier towards marketing communications and that adhocracy culture could act as driver. However, further research needs to be conducted to reaffirm these findings