An – Chapter 8 – Establishing – Flashcards
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Setting Objectives
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- Specific Goals & Objectives SHOULD form the foundation upon which ALL promotional decisions are made - IMC objectives are required for several reasons: 1. set direction, give focus and facilitate coordination 2. guide planning and decision-making 3. facilitate measurement and evaluation. In spite of its importance, setting objectives is one of the most poorly handled management functions.
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Hierarchy of objectives
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Marketing objectives ⇣ IMC objectives ⇣ Advertising objectives and Objectives for other elements of IMC
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Marketing objectives
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- Generally stated in the firm's marketing plan - Achieved through the overall marketing plan - Quantifiable, such as sales, market share, ROI - Must be realistic and attainable to be effective - To be accomplished in a given period of time
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IMC objectives
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- Derived from the overall marketing plan - More narrow than marketing objectives - Based on particular communications tasks - Designed to deliver appropriate messages - Focused on a specific target audience
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Characteristics of objectives
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Elements of objectives : - Measurable communications tasks - Time period - Benchmark starting point for degree of change sought - Specify target audience
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Sales objectives
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- Sales ~ Volumes ~ $$$ Value - Return on Investment ~ [ROI] - Relative market share
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Communication objectives
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- Communications effects hierarchy - Phased movement toward purchase ~ Awareness action
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Factors affecting Sales
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- Advertising and promotion - Competition - Product quality - Distribution - Technology - Price - The economy
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Use sales objectives when...
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Sales objectives are appropriate when using: - IMC tools designed to elicit direct action ~ retail sales oriented advertising ~ direct response advertising ~ sales promotion initiatives ~~ [Coupons] [Trade Allowances] [POP Displays] Also useful when advertising plays a dominant role in the marketing program, such as in FMCG category.
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Communications Objectives
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Possible communication objectives include: - increasing the percentage of consumers in the target market who associate specific features, benefits or advantages with our brand - increasing the number of consumers in the target audience who prefer our product over the competition - encouraging current users of the product to use it more frequently or in more situations - encouraging consumers who have never used our brand to try it.
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Communication Objectives Diagram
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** view diagram on page 237 of Advertising - Ab Integrated Marketing Communication Perspective by Belch, Belch, Kerr, Powell
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Pyramid of Communications Effects Diagram
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** view diagram on page 238 of Advertising - Ab Integrated Marketing Communication Perspective by Belch, Belch, Kerr, Powell
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Approaches to setting objectives: DAGMAR
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Define, Advertising, Goals for, Measuring, Advertising, Results Awareness ⇣ Comprehension ⇣ Conviction ⇣ Action
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DAGMAR's advantages and limitations
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Advantages - Assessment of campaign effectiveness - Value of communication-based objectives - Measurement of stages - Less subjective Limitations - Problems with the response hierarchy - Sales objectives - Practicality and cost - Inhibition of creativity
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RTTT
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Realistic, Target market is clearly defines, Task - state exactly what degree of change is sought, T for the timeframe of the objective
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SMARTT
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Specific - clear, precise and directional Measurable - quantified measurement statement Achievable - capable for being achieved Realistic - approach in light of situation analysis Targeted - defines the target market Timed - timeframe for achievement
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Advertising-based view of communications
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** view diagram on page 245 of Advertising - Ab Integrated Marketing Communication Perspective by Belch, Belch, Kerr, Powell
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Balancing objectives and budgets
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What we're willing and able to spend? What we need to achieve our objectives?
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Theoretical Issues associated with Budgeting
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- Many models take an economic or sales response perspective. Approaches include: ~ Marginal Analysis ~~ continue to spend on advertising while marginal revenues greater than costs ~Sales response models ~~ Concave-downward function ~- as advertising $ increase, its incremental value decreases ~~ S-shaped response function ~- Small initial impact for $, then incremental effect
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Marginal analysis
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** view diagram on page 247 of Advertising - Ab Integrated Marketing Communication Perspective by Belch, Belch, Kerr, Powell
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Basic principles of marginal analysis
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Increase spending - If the increased cost is less than the incremental (marginal) return Hold spending - If the increased cost is equal to the incremental (marginal) return Decrease spending - If the increased cost is more than the incremental (marginal) return
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Advertising sales/response functions
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** view diagram on page 249 of Advertising - Ab Integrated Marketing Communication Perspective by Belch, Belch, Kerr, Powell
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Top-down budgeting
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Top management sets the spending limit ⇣ The promotion budget is set to stay within the spending limit
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Top-down budgeting methods
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Top management - Competitive parity - Arbitrary allocation - Return on investment - Affordable method - Percentage of sales
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Percentage of sales
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** view diagram on page 253 of Advertising - Ab Integrated Marketing Communication Perspective by Belch, Belch, Kerr, Powell
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Impact of competitors' advertising outlays
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** view diagram on page 255 of Advertising - Ab Integrated Marketing Communication Perspective by Belch, Belch, Kerr, Powell
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Build-up Budgeting
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- Total budget is approved by top management - Cost of activities are budgeted - Activities to achieve objectives are planned - Promotional objectives are set
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Objective & Task method
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- Establish objectives - (create awareness of new product among 20% of target market) - Determine specific tasks - (advertise on market area television and radio and local newspapers) - Estimate costs associated with tasks - (determine costs of advertising, promotions, etc.) - Monitor and adjust - (monitor performance and adjust)
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Considerations in Allocating the IMC Budget
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- Allocation of budget between available IMC tools ~ Matching to objectives ~ Utilising optimum combination / creating synergy - Client / Agency policies - Market size - Market potential - Market Share goals
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Ad spending and share of voice
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** view diagram on page 263 of Advertising - Ab Integrated Marketing Communication Perspective by Belch, Belch, Kerr, Powell
