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Belch: Advertising and
Promotion, Sixth Edition
IV. Objectives and
Budgeting for Integrated
Marketing
Communications Programs
7. Establishing Objectives
and Budgeting for the
Promotional Program
cific objectives in mind, and setting objectives without regard to how much money is
available makes no sense. For example, a company may wish to create awareness
among X percent of its target market. A minimal budget amount will be required to
accomplish this goal, and the firm must be willing to spend this amount.
The objective and task method of budget setting uses a buildup approach consisting
of three steps: (1) defining the communications objectives to be accomplished,
(2) determining the specific strategies and tasks needed to attain them, and (3) estimating
the costs associated with performance of these strategies and tasks. The total budget
is based on the accumulation of these costs.
Implementing the objective and task approach is somewhat more involved. The
manager must monitor this process throughout and change strategies depending on
how well objectives are attained. As shown in Figure 7-18, this process involves several
steps:
1. Isolate objectives. When the promotional planning model is presented, a company
will have two sets of objectives to accomplish—the marketing objectives for the product
and the communications objectives. After the former are established, the task
involves determining what specific communications objectives will be designed to
accomplish these goals. Communications objectives must be specific, attainable, and
measurable, as well as time limited.
2. Determine tasks required. A number of elements are involved in the strategic
plan designed to attain the objectives established. (These strategies constitute the
remaining chapters in this text.) These tasks may include advertising in various media,
sales promotions, and/or other elements of the promotional mix, each with its own
role to perform.
3. Estimate required expenditures. Buildup analysis requires determining the
estimated costs associated with the tasks developed in the previous step. For example,
it involves costs for developing awareness through advertising, trial through
sampling, and so forth.
4. Monitor. As you will see in Chapter 19 on measuring effectiveness, there are ways
to determine how well one is attaining established objectives. Performance should be
monitored and evaluated in light of the budget appropriated.
5. Reevaluate objectives. Once specific objectives have been attained, monies may be
better spent on new goals. Thus, if one has achieved the level of consumer awareness
sought, the budget should be altered to stress a higher-order objective such as evaluation
or trial.
The major advantage of the objective and task method is that the budget is driven
by the objectives to be attained. The managers closest to the marketing effort will have
specific strategies and input into the budget-setting process.
Establish objectives
(create awareness of new product
among 20 percent of target market)
Estimate costs associated with tasks
(television advertising, $575,000;
radio advertising, $225,000;
newspaper advertising, $175,000)
Determine specific tasks
(advertise on market area
television and radio stations
and in major newspapers)
© The McGraw−Hill
Companies, 2003
Figure 7-18 The objective
and task method
225
Chapter Seven Establishing Objectives and Budgeting for the Promotional Program