8605328 Advertising Budget Research

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Advertising Budget &Advertising Budget &

ResearchResearch

Compiled By : Group 6Ruchita, Tasneem, Pinal, Siddharth, Prasad& Murli


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IntroductionIntroduction

Advertising Budget & ResearchAdvertising Budget involves the allocation of

a portion of the total marketing resources tothe advertising function in a firm

Setting Advertising Budget is a timeconsuming activity which needs a fairamount of Managers time to analyze factorsinfluencing Advertising Budget.

Advertising budgeting should be based on acareful analysis of the opportunity foradvertising.

To make an efficient budget it is very

important to conduct research on relevant


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Factors affecting AdvertisingFactors affecting Advertising

BudgetBudget1. Stage in the product Life-cycle

2. Cost Structure of the Company

3. Method of Advertising Budget

4. Competition & Clutter5. Market Share

6. Environmental Climate


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Stage in Product Life-Cycle


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1.Stage in Product Life-1.Stage in Product Life-

CycleCycleAdvertising Budget is set considering in what

stage of life-cycle is product category.

Amount of Budget may vary depending onlevel of advertisement demanded by the

product at particular stage of life-cycle.The Advertising budget for a product vary in

their cost effectiveness at different stages ofthe product life cycle.


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Research on stages ofPLC


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Research on stages of PLCResearch on stages of PLC

In what stage of life-cycle is theproduct category?

What is the state of consumers

knowledge of product category?What market characteristics

support your stage of life-cycle

evaluation?Evaluation of PLC stage &

identify, do they represent

opportunities or problems?


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Cost Structure of the

Company


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2. Cost Structure of the2. Cost Structure of the

CompanyCompanyThe Advertising Budget is a part

& proportionate replica of theTotal Marketing Budget.

The total marketing budget isapportioned & a part thereof isAdvertising Budget, usually a

percentage share of totalmarketing budget is set aside asAdvertising Budget.


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Research on CostStructure


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Research on CostResearch on Cost

StructureStructureWhat is the amount and

composition of the marketingbudget & advertising budget?Do we have the funds to support an

effective marketing program?Where are the funds coming from,

and when will they be available?

Is the Advt. budget flexible enoughto take care of sudden changes.What is the proportion of marginal

fund & actual fund of the budget?


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Advertising BudgetMethod


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3. Method of determining3. Method of determining

Advertising BudgetAdvertising Budget

The decisions on the amount to be spent are made byadvertising managers in co-operation with advertisingagency. Many companies resort to more than onemethod of determining the size of their advertising

budgets.The method selected determines the size of the

budget & the size of the advertising budget can havean impact upon the composition of the advertisingmix, hence it is of prime importance to select aproper method for Advertising Budget.

Percentage of Sales method Sales objective method Profit Maximization method Objective & Task Approach

Competitors Parity Approach


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Research on selection ofmethod


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Competition & Clutter


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4. Competition & clutter4. Competition & clutter

In order to increase revenue, mediaoutlets often include a large number ofads within a certain time, space orlocation. For instance, television

programs may contain many adsinserted during the scheduled run-timeof a program. A large number ofadvertisements create an environmentof advertising clutter, which makes itdifficult for viewers to recognize andremember particular advertisements.

To break through the clutter advertisersit is important to differentiate from the

clutter at the same time maintain or


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Research on Competition

& Clutter


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Research on Competition &Research on Competition &

Clutter AdvertisingClutter AdvertisingWho are the competitors?What is the degree of

competition with them?

What are the current adcampaigns of competitors

Are competitors successful /

unsuccessful? Why?What can be done to differentiate

from the competition & clutter?


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Is there is opportunity for anothercompetitor? Why?

What are the anticipated

retaliatory moves of competitors?Can they neutralize different

marketing programs we might

develop?


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Market Share


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5.Market Share5.Market Share

One of the convenient andenticing advertising objective ismarket share.

It is very much important for acompany to maintain or increaseits market share.

Anything that induces new triersto buy the product & increasesmarket share of the company is

invaluable & is of vital


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Research on Market

Share


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Research on Market ShareResearch on Market Share

What is the size of market &what will be the future hold?What is the current market share

of the Company?How to analyze the market?

(Aggregate/Segmented) basis?Can the market be meaningfully

segmented or broken into severalhomogeneous groups with inrespect to what they want and

how they buy?


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Environmental Climate


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6.Environmental Climate6.Environmental Climate

Company should keep itselfupdated with the currentenvironmental climate, which

could bring an opportunity for theproduct to increase the marketshare due to favorability of the

environment.Keeping oneself abreast of the

environmental changes can alsohelp in communicating with thetar et audience effectivel .


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Research on

EnvironmentalClimate


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Research on EnvironmentalResearch on Environmental

ClimateClimateWhat are the relevant social

trends?What are the current political

trends?What are the latest technological

trends?What are the relevant economic

trends?How do you evaluate these

trends? Do they represent

opportunities or problem?

How to create Low budgetHow to create Low budget


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How to create Low budgetHow to create Low budget

Ads which are highlyAds which are highly

effectiveeffectiveIn order to be successful, youradvertising must provide aconsumer benefit or solve aproblem.

That benefit or solution must bewanted by the consumer. The product or service you are

offering must be related directly to

that benefit or solution. The benefit or solution must bedistinctly communicated throughmedial advertising. In other words,it should be clear, the messageshouldnt get lost in the ad.


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Examples of Low Budgetedads highly effective.

1. Apsara extra dark pencil

2. Celebrating 60 years ofIndependence

3. Amul Butter

4. Anti-smoking (publicinterest)

5. Red Bull

High budget Ad highlyHigh budget Ad highly


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High budget Ad , highlyHigh budget Ad , highly

effectiveeffective

Airtel digital TV


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Thank You, SirThank You, Sir

I would like to express my gratitude toMr. Nishant Bhatt. This presentation could

not have been possible without him, who not

only served as our faculty but alsoencouragedfor this challenging task in this academicprogram. He patiently guided me & my

group

through the presentation process, neveraccepting less than my best efforts. I thank

himon behalf of my group.

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8605328 Advertising Budget Research