Advertising Budget &

Research

Compiled By : Group 6
Ruchita, Tasneem, Pinal, Siddharth, Prasad
& Murli
 Introduction
Advertising Budget & Research
 Advertising Budget involves the allocation of
a portion of the total marketing resources to
the advertising function in a firm
 Setting Advertising Budget is a time
consuming activity which needs a fair
amount of Managers time to analyze factors
influencing Advertising Budget.
 Advertising budgeting should be based on a
careful analysis of the opportunity for
advertising.
 To make an efficient budget it is very
important to conduct research on relevant
Factors affecting Advertising
Budget
1. Stage in the product Life-cycle
2. Cost Structure of the Company
3. Method of Advertising Budget
4. Competition & Clutter
5. Market Share
6. Environmental Climate
Stage in Product Life-
Cycle
1.Stage in Product Life-
Cycle
 Advertising Budget is set considering in what
stage of life-cycle is product category.
 Amount of Budget may vary depending on
level 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 of
the product life cycle.
Research on stages of
PLC
Research on stages of PLC
In what stage of life-cycle is the
product 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?
Cost Structure of the
Company
2. Cost Structure of the
Company
The Advertising Budget is a part
& proportionate replica of the
Total Marketing Budget.
The total marketing budget is
apportioned & a part thereof is
Advertising Budget, usually a
percentage share of total
marketing budget is set aside as
Advertising Budget.
Research on Cost
Structure
Research on Cost
Structure
What is the amount and
composition of the marketing
budget & 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 enough
to take care of sudden changes.
What is the proportion of marginal
fund & actual fund of the budget?
Advertising Budget
Method
3. Method of determining
Advertising Budget
 The decisions on the amount to be spent are made by
advertising managers in co-operation with advertising
agency. Many companies resort to more than one
method of determining the size of their advertising
budgets.
 The method selected determines the size of the
budget & the size of the advertising budget can have
an impact upon the composition of the advertising
mix, hence it is of prime importance to select a
proper method for Advertising Budget.

 Percentage of Sales method

 Sales objective method
 Profit Maximization method
 Objective & Task Approach
 Competitors Parity Approach
Research on selection of
method
Research on selection of
method
Which Advt. budget method is
most suitable to the Company?
Which method was used
previously?
How effective was the previous
budget?
What were the problems faced in
the previously selected method
of Advertising Budget?
What can be done to avoid any
Competition & Clutter
4. Competition & clutter
In order to increase revenue, media
outlets often include a large number of
ads within a certain time, space or
location. For instance, television
programs may contain many ads
inserted during the scheduled run-time
of a program. A large number of
advertisements create an environment
of advertising clutter, which makes it
difficult for viewers to recognize and
remember particular advertisements.
To break through the clutter advertisers
it is important to differentiate from the
clutter at the same time maintain or
Research on Competition
& Clutter
Research on Competition &
Clutter Advertising
Who are the competitors?
What is the degree of
competition with them?
What are the current ad
campaigns of competitors
Are competitors successful /
unsuccessful? Why?
What can be done to differentiate
from the competition & clutter?
Is there is opportunity for another
competitor? Why?
What are the anticipated
retaliatory moves of competitors?
Can they neutralize different
marketing programs we might
develop?
Market Share
5.Market Share
One of the convenient and
enticing advertising objective is
market share.
It is very much important for a
company to maintain or increase
its market share.
Anything that induces new triers
to buy the product & increases
market share of the company is
invaluable & is of vital
Research on Market
Share
Research 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 several
homogeneous groups with in
respect to “what they want” and
“how they buy”?
Environmental Climate
6.Environmental Climate
Company should keep itself
updated with the current
environmental climate, which
could bring an opportunity for the
product to increase the market
share due to favorability of the
environment.
Keeping oneself abreast of the
environmental changes can also
help in communicating with the
target audience effectively.
Research on
Environmental
Climate
Research on Environmental
Climate
What 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 budget
Ads which are highly
In order to effective
be successful, your
advertising must provide a
consumer benefit or solve a
problem.
 That benefit or solution must be
wanted by the consumer.
 The product or service you are
offering must be related directly to
that benefit or solution.
 The benefit or solution must be
distinctly communicated through
medial advertising. In other words,
it should be clear, the message
shouldn’t get lost in the ad.
 Examples of Low Budgeted
ads highly effective.
1. Apsara extra dark pencil
2. Celebrating 60 years of
Independence
3. Amul Butter
4. Anti-smoking (public
interest)
5. Red Bull
High budget Ad , highly
effective
Airtel digital TV
 Thank You, Sir
I would like to express my gratitude to
Mr. Nishant Bhatt. This presentation could
not have been possible without him, who not
only served as our faculty but also
encouraged
for this challenging task in this academic
program. He patiently guided me & my
group
through the presentation process, never
accepting less than my best efforts. I thank
him
on behalf of my group.

Thank You