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202<br />

Part Four Objectives and Budgeting for Integrated Marketing<br />

Communications Programs<br />

Belch: Advertising and<br />

Promotion, Sixth Edition<br />

Exhibit 7-7 Hitachi<br />

creates an image of speed<br />

and reliability<br />

IV. Objectives and<br />

Budgeting for Integrated<br />

Marketing<br />

Communications Programs<br />

7. Establishing Objectives<br />

and Budgeting for the<br />

Promotional Program<br />

© The McGraw−Hill<br />

Companies, 2003<br />

campaigns designed to create and enhance favorable perceptions of their stores. In this<br />

case, sales-oriented objectives would not be appropriate; the effectiveness of the campaign<br />

would be based on its ability to create or change consumers’ image of the store.<br />

Sales-oriented objectives are also used when advertising plays a dominant role in a<br />

firm’s marketing program and other factors are relatively stable. For example, many<br />

packaged-goods companies compete in mature markets with established channels of<br />

distribution, stable competitive prices and promotional budgets, and products of similar<br />

quality. They view advertising and sales promotion as the key determinants of a<br />

brand’s sales or market share, so it may be possible to isolate the effects of these promotional<br />

mix variables. 9 Many companies have accumulated enough market knowledge<br />

with their advertising, sales promotion, and direct-marketing programs to have<br />

considerable insight into the sales levels that should result from their promotional<br />

efforts. Referring to the cereal companies, mentioned earlier, Jeff Montie, president of<br />

Kellogg’s Morning Foods Division, now believes that it takes at least $20 million to<br />

“do it right” in promoting a cereal brand. 10 Thus, many companies believe it is reasonable<br />

to set objectives and evaluate the success of their promotional efforts in terms of<br />

sales results. Established brands are often repositioned (as discussed in Chapter 2)<br />

with the goal of improving their sales or relative market share.<br />

Advertising and promotional programs tend to be evaluated in terms of sales, particularly<br />

when expectations are not being met. Marketing and brand managers under<br />

pressure to show sales results often take a short-term perspective in evaluating advertising<br />

and sales promotion programs. They are often looking for a quick fix for declining<br />

sales or loss of market share. They ignore the pitfalls of making direct links<br />

between advertising and sales, and campaigns, as well as ad agencies, may be changed<br />

if sales expectations are not being met. As discussed in Chapter 3, many companies<br />

want their agencies to accept incentive-based compensation systems tied to sales performance.<br />

Thus, while sales may not be an appropriate objective in many advertising<br />

and promotional situations, managers are inclined to keep a close eye on sales and<br />

market share figures and make changes in the promotional program when these numbers<br />

become stagnant.<br />

Communications Objectives<br />

Some marketers do recognize the problems associated<br />

with sales-oriented objectives. They recognize that the<br />

primary role of an IMC program is to communicate and<br />

that planning should be based on communications objectives.<br />

Advertising and other promotional efforts are<br />

designed to achieve such communications as brand<br />

knowledge and interest, favorable attitudes and image,<br />

and purchase intentions. Consumers are not expected to<br />

respond immediately; rather, advertisers realize they<br />

must provide relevant information and create favorable<br />

predispositions toward the brand before purchase behavior<br />

will occur.<br />

For example, the ad for Hitachi in Exhibit 7-7 is<br />

designed to inform consumers of the speed and reliability<br />

of the company’s products and technologies. While there<br />

is no call for immediate action, the ad creates favorable<br />

impressions about the company by creating a distinct<br />

image. Consumers will consider it when they enter the<br />

market for products in this category.<br />

Advocates of communications-based objectives generally<br />

use some form of the hierarchical models discussed<br />

in Chapter 5 when setting advertising and promotion<br />

objectives. In all these models, consumers pass through<br />

three successive stages: cognitive, affective, and conative.<br />

As consumers proceed through the three stages, they<br />

move closer to making a purchase. Figure 7-2 shows the

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