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Objective-and-task method Objective-and-Task Method
Developing the promotion budget
by (1) defining specific promotion The most logical budget-setting method is the objective-and-task method, whereby the
objectives, (2) determining the tasks company sets its promotion budget based on what it wants to accomplish with promotion.
needed to achieve these objectives, and This budgeting method entails (1) defining specific promotion objectives, (2) determining
(3) estimating the costs of performing the tasks needed to achieve these objectives, and (3) estimating the costs of performing
these tasks. The sum of these costs is these tasks. The sum of these costs is the proposed promotion budget.
the proposed promotion budget.
The advantage of the objective-and-task method is that it forces management to
spell out its assumptions about the relationship between dollars spent and promotion re-
sults. But it is also the most difficult method to use. Often, it is hard to figure out which
specific tasks will achieve the stated objectives. For example, suppose Samsung wants a
95-percent-awareness level for its latest smartphone model during the six-month introduc-
tory period. What specific advertising messages, marketing content, and media schedules
should Samsung use to attain this objective? How much would this content and media cost?
Samsung management must consider such questions, even though they are hard to answer.
Author In this section, we’ll look at Shaping the Overall Promotion Mix
Comment how marketers blend the
various marketing communication tools The concept of integrated marketing communications suggests that the company must
into a smooth-functioning, integrated, and blend the promotion tools carefully into a coordinated promotion mix. But how does it de-
engaging promotion mix. termine what mix of promotion tools to use? Companies within the same industry differ
greatly in the design of their promotion mixes. For example, cosmetics maker Mary Kay
spends most of its promotion funds on personal selling and direct marketing, whereas com-
petitor CoverGirl spends heavily on consumer advertising. We now look at factors that
influence the marketer’s choice of promotion tools.
The Nature of Each Promotion Tool
Each promotion tool has unique characteristics and costs. Marketers must understand these
characteristics in shaping the promotion mix.
Advertising. Advertising can reach masses of geographically dispersed buyers at a low
cost per exposure, and it enables the seller to repeat a message many times. For example,
television advertising can reach huge audiences. Nearly 112 million Americans watched
the most recent Super Bowl, more than 43 million people watched at least
part of the last Academy Awards broadcast, and as many as 22 million
avid fans tuned in each week for the latest season of NCIS. What’s more, a
popular TV ad’s reach can be extended through online and social media.
For example, in addition to the 100+ million TV viewers, Microsoft’s
inspiring and effective Super Bowl XLVIII ad “Empowering”—about
how technology improves our lives and empowers us all to make the
impossible possible—drew more than 3.7 YouTube views during the en-
suing two months. For companies that want to reach a mass audience, TV
is the place to be.16
Beyond its reach, large-scale advertising says something positive
about the seller’s size, popularity, and success. Because of advertising’s
public nature, consumers tend to view advertised products as more le-
gitimate. Advertising is also very expressive; it allows the company to
dramatize its products through the artful use of visuals, print, sound, and
color. On the one hand, advertising can be used to build up a long-term
image for a product (such as Coca-Cola ads). On the other hand, advertis-
ing can trigger quick sales (as when Kohl’s advertises weekend specials).
Advertising also has some shortcomings. Although it reaches many
people quickly, advertising is impersonal and lacks the direct persuasive-
ness of company salespeople. For the most part, advertising can carry on
only a one-way communication with an audience, and the audience does
TV advertising has vast reach. Microsoft’s inspiring not feel that it has to pay attention or respond. In addition, advertising can
Super Bowl XLVIII ad, “Empowering”—about how be very costly. Although some advertising forms, such as newspaper and
technology improves our lives—drew 100∙ million radio advertising, can be done on smaller budgets, other forms, such as
TV viewers and triggered millions of online views and network TV advertising, require very large budgets. For example, the one-
shares. minute Microsoft “Empowering” Super Bowl ad discussed above cost
Microsoft $8 million for media time alone, not counting the costs of producing the ad.
