ch 7 imc student pdf

7/24/2019 Ch 7 IMC Student PDF

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7-1Copyright 2015 McGraw-Hill Education. All rights

reserved. No reproduction or distribution without the prior

written consent of McGraw-Hill Education.

CHAPTER 7

Establishing

Objectives andBudgeting for the

PromotionalProgram


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Value of Objectives

Communications Objectives facilitate coordination of the

various groups

Planning and decision making Objectives guide decision making and

development of the integrated marketingcommunications plan

Measurement and evaluation of results

Objectives provide a benchmark tomeasure success or failure


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Marketing Objectives versus Integrated MarketingCommunications Objectives

Marketing objectives

Identify what is to be

accomplished by the overall

marketing program

Defined in terms of specific

and measurable outcomes

Must be quantifiable,

realistic, and attainable

Integrated marketingcommunications objectives

Statements of what various

aspects of the IMC program

will accomplish

Based on the particular

communications tasks

required to deliver the

appropriate messages to the

target audience


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Sales-Oriented Objectives

Aim to increase sales Require economic justification

Required to produce quantifiable

results Based on the achievement of sales

results


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Figure 7.1 - Factors Influencing Sales


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Problems with Sales Objectives

Successful implementation requires allmarketing elements to work together

Carryover effect: Monies spent on advertising donot have immediate impact on sales

Advertising has carryover effect

It is difficult to determine precise relationship

between advertising and sales

Do not offer much guidance for planningand developing promotional program


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Communications Objectives

Set using models wherein consumerspass through three stages

Cognitive

Affective Conative


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Communications Effects Pyramid

20% Trial

5% Use

90% Awareness

70% Knowledge/comprehension

40% Liking

25% Preference


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Problems with Communications Objectives

Translating sales goals intocommunications objectives

Promotional planners have difficultyestimating what constitutes adequatelevels of awareness, knowledge, liking,preference, or conviction

No formulas or guidelines


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Characteristics of Objectives

Concrete,measurable tasks

Benchmarkmeasures

Well-definedaudience

Specifiedtime period


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Zero-Based Communications Planning

Involves determining: What tasks need to be done

Which marketing communicationsfunctions should be used and to whatextent

Focuses on the task to be done andsearches for the best ideas and media

to accomplish


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Figure7.5 - Objectives and Strategies in the SocialConsumer Decision Journey

Source: Expert interviews; McKinsey analysis


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Example of Communications ObjectiveStatements

Figure 7-6

: The San Diego Zoo Sets Objectives forVarious Promotional Elements


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Type of Objectives

Marketing Objectives Sales Objectives

Communication Objectives

Communication Effects Pyramid


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Balancing Objectives and Budgets

What were

willing and

able to spend

What we needto achieve our

objectives


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Top-Down vs. Bottom-Up Budgeting


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Top-Down Budgeting Methods

TopManagement

AffordableMethod

CompetitiveParity

Percentageof Sales

Return onInvestment

ArbitraryAllocation

All-you-can-afford

What is feltto be necessary

Base on sales

of productBase on

competitors' spending

Advertising causessales


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Build-Up Approaches

Objective and Task Method: Figure 7-18


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Implementing the Objective and Task Approach

Isolate objectives

Reevaluate objectives

Determine tasks required

Estimate required expenditures

Monitor


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Budgeting

Top Down

1. Affordable Method

2. Arbitrary Allocation

3. Percentage of Sales

4. Competitive Parity5. Return on Investment

Build Up

1. Objectiveand TaskApproach


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Steps to Develop and Implement the Budget

Employ comprehensive strategy

Develop strategic planning framework that employs anintegrated marketing communications philosophy

Develop contingency plans

Focus on long-term objectives

Evaluate effectiveness of programs have tobe consistently


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Other Budget Allocation Factors

Budgeting Factors Client/agency policies

Market size

Market potential Market share goals

Fi 7 24 Th Sh f V i (SOV)


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Figure 7.24 - The Share of Voice (SOV)Effect and Ad Spending: Priorities in Individual Markets


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Organizational Characteristics

Factors that influence advertising andpromotion budgets

Organizational structure

Power and politics Use of expert opinions

Characteristics of the decision maker

Approval and negotiation channels

Pressure on senior managers to arriveat the optimal budget

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