Establishing Objectives
and Budgeting for the
Promotional Program
Value of Objectives
Focus
Focus &
&
Objectives
Objectives Coordination
Coordination
Plans
Plans &
&
Decisions
Decisions
Measurement
Measurement
&& Control
Control
Characteristics of Objectives
Attainable
Attainable
Realistic
Realistic Measurable
Measurable
Objectives
Objectives
Not
Not Mutually
Mutually Specific
Specific
Exclusive
Exclusive
Advertising Can Shape Corporate Images
Marketing Versus 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
overall
overall marketing
marketing plan plan marketing
marketing objectives
objectives
•• Quantifiable,
Quantifiable, such
such as as Vs. •• 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
Many Different Factors Affect Sales
$ ALE$
$ALE $
Advertising
Advertising Product
Product
and
and Competition
Competition quality
quality
promotion
promotion
The
The
Distribution
Distribution Technology
Technology Price
Price economy
economy
Advertising and Movement Toward Action
Conative Purchase Point of purchase
Retail store ads, Deals
Realm of motives. “Last-chance” offers
Price appeals, Testimonials
Ads stimulate or
direct desires. Conviction
Preference Competitive ads
Affective Argumentative copy
Realm of emotions.
Ads change attitudes Liking “Image” copy
Status, glamour appeals
and feelings
Knowledge Announcements
Descriptive copy
Classified ads
Cognitive Slogans, jingles, skywriting
Realm of thoughts.
Ads provide Awareness Teaser campaigns
information and facts.
Pyramid of Communications Effects
5% Use
e
tiv
na 20% Trial
Co
e
25% Preference
iv
ct
fe
Af
40% Liking
ve
70% Knowledge
i ti
gn
Co
90% Awareness
The DAGMAR Approach
Define Awareness
Awareness
Advertising
Goals for
Comprehension
Comprehension
Comprehension
Comprehension
Measuring Conviction
Conviction
Advertising
Results Action
Action
Pros and Cons of DAGMAR
Pros Cons
Assessment
Assessment ofof campaign
campaign Problems
Problems with
with the
the
effectiveness
effectiveness response
response hierarchy
hierarchy
Value
Value of
of communication-
communication- Sales
Sales objectives
objectives
based
based objectives
objectives
Measurement
Measurement of
of stages
stages Practicality
Practicality and
and cost
cost
Less
Less subjective
subjective Inhibition
Inhibition of
of creativity
creativity
Advertising-Based View of Communications
Advertising Through Media
Acting on Consumers
Top-Down Budgeting
Top
Top Management
Management Sets
Sets the
the Spending
Spending Limit
Limit
The
The Promotion
Promotion Budget
Budget Is
Is Set
Set to
to Stay
Stay Within
Within
the
the Spending
Spending Limit
Limit
Top-Down Budgeting Methods
Competitive
Competitive
Parity
Parity
Arbitrary
Arbitrary Percentage
Percentage
Allocation
Allocation Top of
of Sales
Sales
Top
Management
Management
Return
Return on
on Affordable
Affordable
Investment
Investment Method
Method
Bottom-Up Budgeting
Total
Total Budget
Budget Is
Is Approved
Approved by
by
Top
Top Management
Management
Cost
Cost of
of Activities
Activities are
are Budgeted
Budgeted
Activities
Activities to
to Achieve
Achieve Objectives
Objectives
Are
Are Planned
Planned
Promotional
Promotional Objectives
Objectives Are
Are Set
Set
Objective and Task Method
Establish
Establish Objectives
Objectives
(create
(create awareness
awareness of
of new
new product
product
among
among 2020 percent
percent of
of target
target market)
market)
Determine
Determine Specific
Specific Tasks
Tasks
(advertise
(advertise on
on market
market area
area television
television and
and
radio
radio and
and local
local newspapers)
newspapers)
Estimate
Estimate Costs
Costs Associated
Associated with
with Tasks
Tasks
(determine
(determine costs
costs of
of advertising,
advertising,
promotions,
promotions, etc.)
etc.)
Monitor
Monitor and
and Adjust
Adjust
(monitor
(monitor performance
performance and
and adjust)
adjust)