Subject: General Questions / College life
Create the Marketing Objectives, Situational Analysis, and Budget portion of the Marketing Communications Plan using the business and information presented in the Case Study. Meet the following requirements:
In 50 words list and explain the marketing objectives.
In 200 words complete a Situational analysis.
In 50 words, explain the budget in terms of percentage allocated to each communication vehicle. (This may change in the final plan).
Using feedback, update and make changes to the previous section of the plan.
Please adhere to the Publication Manual of the American Psychological Association, (6th ed., 2nd print) when writing and submitting assignments and papers.
So far we have determined our target market and branded our product. We know who uses our product into will be ready to determine how to reach that audience.
Our product has a brand identity and now we have to make the brand awareness and brand image a reality.
To do that, we need to set our marketing communications objectives.
To begin, we need an understanding of setting goals and objectives in general.
"A goal is a general statement about a desired outcome with one or more specific objectives that define in precise terms what is to be accomplished within a designated time frame" (Lehigh.edu, 2007, para. 2).
The best way to set goals is to use the S.M.A.R.T. criteria. The acronym S.M.A.R.T. stands for specific, measurable, attainable, relevant, and time-bound. Using each of these fivecharacteristicsin your goals will help ensure that they are met.
A specificgoal answers the five Ws of who, what, where, when, and why.
When goals are specific, they are measurable. You have to know if progress is being made towards the goal.
Next, goals should be attainable; they should not be out of reach or unrealistic.
The objectives should be relevantand pertinent to the company's mission and vision. In the case of marketing communications goals, they need to relevant to the marketing plan.
Finally, the goals need a targetdatefor implementation or an end-date.
Goals with deadlines or schedules are time-bound.
Let's look at a car company needing to set objectives. They want to increase the number of test drives–but that is not a SMART goal.
Rather, Increase the number of test drives by 10% through the use of a direct marketing campaign by the end of 2013. It is specific and measurable (increase the number of test drives), attainable (it is not 90%), relevant (test drives lead to sales), and time-bound (by the end of 2013).
An example of a SMART marketing communications objective would be:
To increase brand awareness by 10% (measurable) in the 18-25 aged market (specific) within the next three months (time-bound) by launching directive advertising (attainable, relevant).
Stephen J. Welsh (1965) proposes five criteria that should be used when establishing objectives that still hold true today.
Objectives should be in writing and communicated throughout the entire company, long-term but flexible, implemented, specific and measurable, and meet the requirements of the company based on the industry and market.
It is important to communicate theobjectivesthroughout the firm so that everyone sends out one message. When creating examples, keep the long-term goals of the company in mind–even when creating short-term goals. An objective is only as good as the plan and implementation that follows; it needs to follow the SMART format and be attainable based on the characteristics of the firm and the market.
One debate in marketing communications is if the objectives should be tied to sales.
The traditional thought is that sales are contingent on many other factors besides marketing such as season, economic conditions, stage in the product life cycle, and competition.
Depending on the product or service, the company might see the results of marketing communications campaign the next day, the next month, or even the next year.
Because of this, it is difficult to directly tie marketing and marketing communications to sales.
On the other hand, a more recent view is that while marketing communications creates brand awareness, the key factor is to encourage the consumer to buy the product or service.
If the marketing/marketing communications campaign does not increase sales, what is its worth and return on investment?
Marketing communications should increase brand awareness and increase sales.
In general, there are three marketing communications objectives.
First determine the way to make the target market aware of your brand.
Second, in that message explain to the target market why they need your brand; convince them to purchase the product or service.
Finally, ask the intended target market to take action and make that purchase.
The target market is made aware of the brand and convinced to take action through the marketing communications.
We will start a discussion of the different types of media next week, which will help you to determine the specific advertising/communications vehicles needed to create the brandawareness.
Both personally and professionally, we are all looking to do more with less. Companies are forced to do the same, especially in times of an economic downturn.
As Schultz (1994), "Although we must have multiple marketing and communications programs to fit the vastly different customers and prospects that technology has allowed us to discover, the financial and employee resources to accomplish them either have declined or are declining precipitously" (p.7).
The objections for marketing communications are set, so now it's time to decide how much money will be spent meeting those objectives.
The budgetingdecisioncan be divided into two sections: how much money is on advertising and promotion in general and how much of that total money marked is spent on the different media, target markets, and geographic regions.
There are several different ways to determine a marketingcommunicationsbudget: percentage-of-sales, competitive parity, and objective-and-task methods.
The first budgeting method is percentage-of-sales. There are two ways to use this budgeting method.
One option is to allocate budgeting dollars as a fixed percentage of past sales.
The second option is to use the percentage of the forecasted future sales.
The percentage is often determined by the industry standard.
Several companies provide this service including Datamonitor and Schonfeld & Associates.
See this table for industry standards
Using either method (past or future sales), the formula is the same: start with sales and multiply by the percentage.
For example, if the product is malt beverages (3.8 % industry standard for advertising) and sales for last year (or the estimated sales for this year) were $100,000,000, the budget would be $3,800,000.
The main issue with this method in either form is the same as in the objectives–are sales and advertising/marketing a logical relationship?
This is an easy way to set a budget and while this method is common, most marketing managers do not use it in its pure form. Rather they use it as a starting point and then adjust as needed.
The second method to determine a marketing communications budget is competitiveparity, which correlates the budget to the share of the market and share of voice (SOV) for the industry.
The share of voice is the percentage of advertising dollars spent by one company in comparison to the entire industry.
Using the above example, if the malt beverage company is spending $3,800,000 and the total industry advertising dollars spent is $100,000,000 the share of voice is 3.8% and this is the start of the budget.
If the company wants to increase SOV, it will increase the budget.
The desire is that the SOV results in a larger market share. In essence, the company is basing its budget on the actions of the competition.
Most advertising and marketing departments use objective-and-task budgeting.
This method uses the marketing/marketing communications objectives (see lecture #1) and tasks needed to complete those objectives to determine the budget.
The firm reviews the marketing objectives, determines the advertising media for those objectives, and calculates the cost to meet the objectives and reach its target audience.
If advertising and marketing is not considered an important function in a company, it might allocate funds based on what is affordable.
In other words, after everything else has been budgeted, the marketing department receives whatever remains.