objective setting and budgeting Flashcards
why setting marcom objectives is important
- agreement on the the direction and goals of the advertising strategy
- guides the budgeting, message, and media aspects of advertising strategy - reach target audience effectively
- provide standards against with results can be measured - evaluate if the campaign meets its intended goals
Hierarchy of effects model : MOVE CONSUMERS FROM ONE GOAL TO THE NEXT GOAL
- awareness :brand recall and recognition (cognitive stage) COMMUNICATION OBJECTIVE
- knowledge : how much you understand the product/brand (affective stage) COMMUNICATION OBJECTIVE
- liking : attitude, image, favorable feelings (affective) COMMUNICATION OBJECTIVE
- preference : which one do you prefer to buy (affective) COMMUNICATION OBJECTIVE
- conviction : customers become convinced of the product’s value and considers purchasing it (affective) COMMUNICATION OBJECTIVE
- purchase (conative stage) SALES OBEJCTIVE
setting good marcom (advertising) objectives
- include a precise statement of who, what, and when
- be quantitative and measurable
- specify the amount of change
- be realistic
- be internally consistent
- be clear and put it in writing (marketing plan)
indirect and direct objectives
- indirect objectives: to increase the target audience’s brand awareness, enhance their attitudes toward the brand, shift their preferences from competitors’ brand
- direct objectives : increase sales by a particular amount
stages of the decision-making process
- problem recognition : identifying a need or problem
- search : looking for information or products
- evaluation : comparing different options
- choice : purchase decision
- outcomes : reflecting on the purchase
practical budgeting methods
- percent-of-sales budgeting : establishing the
budget as a fixed percentage of past (e.g.,
last year’s) or anticipated (e.g., next year’s)
sales volume - objective-and-task method : specify
clear objectives for the
advertising, identify the
tasks the advertising
must perform to reach
these objectives, and
then set the budget
accordingly (ties the budget directly with the desired outcome) - competitive parity method : sets the
advertising budget
by examining what
competitors are doing. - affordability method : based on what the company can afford to spend
5 basic functions performed by advertising
- informing
- influencing
- reminding and increasing salience
- adding value
- assisting other company efforts
the advertising management process
advertising strategy
1. setting objectives
2. formulating budgets
3. creating ad messages
4. selecting ad media and vehicles
strategy implementation
assessing ad effectiveness
role of advertising agencies
advertising function alternatives
1. in-house advertising operation : employing an advertising staff and absorbing the operation costs, unprofitable for small advertising
- purchase services as needed :
- use services only when they are needed
- availability of high-caliber creative talent
- cost efficiencies
- flexible
- stereotyped fashion
- lack of cost accountability
- financial instability of smaller boutiques - use a full-service advertising agency
adv
- in-depth knowledge and skills
-big media channels
- specialised expertise across various aspects of advertising
disadv
- lost of control
- larger clients are more favorable
- inefficient in media buying
advertising agency organisation
- creative services : content of advertising
- media services : experts in STP, selecting the best advertising media
- research services : study customers buying habits, purchase preferences , and responsiveness
- account management : link the agency with the client
agency compensation
- commissions from media (15%), reduced commissions system (<15%) NEGOTIABLE
- labor-based fee system : charge based on how hard the project is, hours spent
- outcome-based : 15% brand awareness increase
investing and disinvesting
- investing : advertising can increase profitability by increasing sales volume, enabling higher selling prices, increasing revenue beyond the incremental advertising expense
- disinvesting : reduce investing expenses when brand is performing well, or during recession, expense reduction with all else held constant, will result in increased profits.
elasticity
A measure
of how responsive
demand for a brand is
to changes in marketing variables such as
price and advertising.
