Establishing Objectives

and Budgeting for the

Promotional Program
Value of Objectives

Specific
Objectives Communications
Communications

Planning
Planning &
&
Decision
Decision Making
Making

Measurement
Measurement
&
& Evaluation
Evaluation
Characteristics of Objectives
Specific

Attainable Measurable

Realistic Quantifiable
 Marketing vs. Communications Objectives

Communications
Communications
Marketing
Marketing Objectives
Objectives Objectives
Objectives

•• Generally
Generally stated
stated in in the
the •• Derived
Derived from
from the
the overall
overall
firm’s
firm’s marketing
marketing plan plan marketing
marketing plan
plan
•• Achieved
Achieved through
through the the •• More
More narrow
narrow than
than
Vs.
overall
overall marketing
marketing plan plan marketing
marketing objectives
objectives
•• Quantifiable,
Quantifiable, such
such as as •• Based
Based onon particular
particular
sales,
sales, market
market share,
share, ROI ROI communications
communications taskstasks
•• To
To be
be accomplished
accomplished in in aa •• Designed
Designed to to deliver
deliver
given
given period
period ofof time
time appropriate
appropriate messages
messages
•• Must
Must bebe realistic
realistic andand •• Focused
Focused onon aa specific
specific
attainable
attainable to
to be
be effective
effective target
target audience
audience
Sales Objectives
Increased Market Share

Increased Sales Brand Extensions

Factors Influencing Sales
Technology
Competition

The economy
Advertising &
promotion

Product
quality
Distribution
Price
From Awareness to Action
Point of purchase
Conative Purchase Retail store ads, deals
Realm of motives. “Last-chance” offers
Ads stimulate or direct Price appeals
desires Conviction
Testimonials

Preference Competitive ads

Affective Argumentative copy
Realm of emotions.
Ads change attitudes and Liking “Image” copy
feelings Status, glamour appeals

Knowledge Announcements
Descriptive copy
Cognitive Classified ads, slogans, Jingles,
Realm of thoughts. skywriting
Ads provide information Awareness
Teaser campaigns
and facts
90% Awareness
70% Knowledge/Comprehension
40% Liking
25% Preference
20% Trial
5% Use
Communications Effects Pyramid
Problems with Communications
Objectives
• Increasing the percentage of consumers in the
target market who associate specific features,
benefits, or advantages with our brand.
• Increasing the number of consumers in the target
audience who prefer our product over the
competition’s.
• Encouraging current users of the product to use it
more frequently or in more situations.
• Encouraging consumers who have never used our
brand to try it.
The DAGMAR Approach

Define Awareness
Awareness

Advertising
Goals for
Comprehension
Comprehension

Measuring
Advertising
Conviction
Conviction

Results Action
Action
Characteristics of Objectives

Concrete, Well-defined
measurable tasks audience

Benchmark Specified
measures time period
Pros and Cons of DAGMAR
Pros Cons

Focus
Focusononcommunications
communications Relies
Reliesheavily
heavilyon
on the
theresponse
response
objectives
objectives hierarchy
hierarchy

Measurement
Measurementof
ofstages
stages May
May not
notincrease
increasesales
sales
Setting Objectives for the IMC Program
Better
Betterunderstanding
understandingof
ofgoals
goals Practicality
Practicalityand
andcost
cost
and
andobjectives
objectives

Less
Lesssubjective
subjective Inhibition
Inhibitionof
ofcreativity
creativity
Establishing & Allocating the Promotional Budget

Sponsorship Direct
Underwriting Marketing

Public Group Sales

Relations

Sales Internet
Promotions
Budget Adjustments

Increase IfIf the

the cost
cost isis less
less than
than the
the marginal
marginal
Increase Spending
Spending return
return

Hold
Hold IfIf the
the cost
cost isis equal
equal to
to the
the
Spending
Spending incremental
incremental return return

IfIf the
the cost
cost isis more
more than
than the
the
Decrease
Decrease Spending
Spending incremental
incremental return return
Assumptions for Marginal Analysis

Sales are a Sales are

direct measure determined
of advertising solely by
and promotions advertising
and promotion
efforts
Factors Influencing Advertising Budgets

Product Hidden product

life cycle qualities

Product Product
durability price

Purchase
Differentiation frequency
Top-Down vs. Bottom-Up Budgeting
Top-Down Budgeting Methods

Affordable
Affordable
Method
Method

Return
Return on
on Arbitrary
Arbitrary
Top
Top
Investment
Investment Allocation
Allocation
Management
Management

Competitive
Competitive Percentage
Percentage
Parity
Parity of
of Sales
Sales
Object and Task Method

Isolate
Isolateobjectives
objectives

Determine
Determinetasks
tasksrequired
required

Estimate
Estimaterequired
requiredexpenditures
expenditures

Monitor
Monitor

Reevaluate
Reevaluateobjectives
objectives
Payout Planning
Quantitative Models
Allocating to IMC Elements