This document discusses advertising budgeting. It explains that an advertising budget is money set aside by a company to achieve its marketing goals and is a subset of the larger sales budget. It also outlines key questions that must be answered when determining a budget, such as who the target consumer is and what media will be most effective. Further, it describes two common approaches to setting a budget - top-down, where management decides the amount, and bottom-up, which is activity-based. Finally, it lists several methods for determining a budget, such as allocating a percentage of past or expected sales or matching competitors' spending amounts.

1. ADVERTISING BUDGETING
RAHUL R G

2. Advertising Budget
An advertising budget is the money a company is
willing to set aside to accomplish its marketing
objectives.
A subset of the larger sales budget .
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3. Answering several important questions?
• Who is the target consumer?
• What media type will be most useful in reaching the
target consumer?
• What is required to get the target consumer to
purchase the product?
• How much profit is likely to be earned for each dollar
spent on advertising?
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4. Two Approaches to decide budget
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Top –Down Approach
Bottom- Up Approach
Management
decides how much
to spend
Activity based or
Object Oriented
approach by
managers

5. Methods to determine --Affordable method
• Budgets on what we can afford.
• Small business
Methods to determine –Percentage of Sales Method
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• Most commonly used by small business.
• Takes a percentage of either past or anticipated sales
and allocates that percentage of the overall budget to
advertising.

6. Methods to determine --Competitive Parity Method
• If a business is aware of how much its competitors are spending to
advertise their products and services, the business may wish to budget
a similar amount on its own advertising by way of staying competitive.
Methods to determine –Objective and Task Method
• Correlate advertising expenditures with overall marketing objectives.
This correlation is important because it keeps spending focused on
primary business goals.
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7. Thank Youuuuuuuuuu
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