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    Establishing Objectives and Budgeting For The Promotional Program

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    Rachit Varshney
    This document discusses establishing objectives and budgeting for promotional programs. It provides characteristics that effective objectives should have such as being specific, measurable, attainable, realistic and quantifiable. The document distinguishes between marketing objectives and communication objectives. It also discusses factors that influence sales and promotional budgets such as competition, technology, economy, product quality and price. Different methods for establishing and allocating promotional budgets are outlined such as marginal analysis and top-down versus bottom-up budgeting. Organizational characteristics that influence advertising budgets are also noted.

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    Establishing Objectives and Budgeting For The Promotional Program

    Uploaded by

    Rachit Varshney
    214 views24 pages
    This document discusses establishing objectives and budgeting for promotional programs. It provides characteristics that effective objectives should have such as being specific, measurable, attainable, realistic and quantifiable. The document distinguishes between marketing objectives and communication objectives. It also discusses factors that influence sales and promotional budgets such as competition, technology, economy, product quality and price. Different methods for establishing and allocating promotional budgets are outlined such as marginal analysis and top-down versus bottom-up budgeting. Organizational characteristics that influence advertising budgets are also noted.

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    budgeting

    Original Title

    IMC-budgeting

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    This document discusses establishing objectives and budgeting for promotional programs. It provides characteristics that effective objectives should have such as being specific, measurable, attainable, realistic and quantifiable. The document distinguishes between marketing objectives and communication objectives. It also discusses factors that influence sales and promotional budgets such as competition, technology, economy, product quality and price. Different methods for establishing and allocating promotional budgets are outlined such as marginal analysis and top-down versus bottom-up budgeting. Organizational characteristics that influence advertising budgets are also noted.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pptx, pdf, or txt
    214 views24 pages

    Establishing Objectives and Budgeting For The Promotional Program

    Uploaded by

    Rachit Varshney
    This document discusses establishing objectives and budgeting for promotional programs. It provides characteristics that effective objectives should have such as being specific, measurable, attainable, realistic and quantifiable. The document distinguishes between marketing objectives and communication objectives. It also discusses factors that influence sales and promotional budgets such as competition, technology, economy, product quality and price. Different methods for establishing and allocating promotional budgets are outlined such as marginal analysis and top-down versus bottom-up budgeting. Organizational characteristics that influence advertising budgets are also noted.

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    of 24

    7

    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

    Marketing
    Marketing Communications
    Communications
    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
    Advertising economy
    & promotion

    Product
    quality
    Distribution
    Price
    Where Sales Objectives are Appropriate
    90% Awareness
    70% Knowledge/Comprehension
    40% Liking
    25% Preference
    20% Trial
    5% Use
    Communications Effects Pyramid
    The DAGMAR Approach

    Define Awareness
    Awareness

    Advertising
    Goals for
    Comprehension
    Comprehension

    Measuring Conviction
    Conviction
    Advertising
    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
    Focus on
    on communications
    communications Relies
    Relies heavily
    heavily on
    on the
    the
    objectives
    objectives response
    response hierarchy
    hierarchy

    Measurement
    Measurement of
    of stages
    stages May
    May not
    not increase
    increase sales
    sales

    Better
    Better understanding
    understanding ofof Practicality
    Practicality and
    and cost
    cost
    goals
    goals and
    and objectives
    objectives

    Less
    Less subjective
    subjective Inhibition
    Inhibition of
    of creativity
    creativity
    Advertising-Based View of Communications

    Ads

    Acting on Consumers
    Establishing & Allocating the Promotional Budget

    Sponsorship Direct
    Underwriting Marketing

    Public Group Sales


    Relations

    Sales Internet
    Promotions
    Marginal Analysis-Establishing a Budget
    Assumptions for Marginal Analysis

    Sales are a Sales are


    direct measure determined
    of advertising solely by
    and promotions advertising
    and promotion
    efforts
    Sales Response Models

    A. Concave-Downward B. S-Shaped Response


    Response Curve Function
    Incremental Sales

    Incremental Sales

    Initial Spending

    High Spending
    Middle Level

    Little Effect
    Little Effect

    High Effect
    Range A Range B Range C
    Advertising Expenditures Advertising Expenditures
    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
    Isolate objectives
    objectives

    Determine
    Determine tasks
    tasks required
    required

    Estimate
    Estimate required
    required expenditures
    expenditures

    Monitor
    Monitor

    Reevaluate
    Reevaluate objectives
    objectives
    Organizational Characteristics

    • Factors that influence advertising and


    promotion budgets
    – The organization’s structure
    – Power and politics
    – The use of expert opinions
    – Characteristics of the decision maker
    – Approval and negotiation channels
    – Pressure on senior managers to arrive
    at the optimal budget
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    Thank You !

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