'Advertisement Budget\r'

'Introduction work out is numerical expression of next plan of activities. It is a future plan of activities expressed in  wrong of  outstanding/rupees. It is brisk for a fixed period of time. advertizing figure is a financial document that’s hows the total add to be spent on advert and lists the way this join is to be allocated. It is a translation of publicize plan into money to be spent on advertise. It is an estimation of total sum total to be spent on denote during a abandoned period of time for achieving marketing objectives.It involves storage allocation of a portion of total marketing resources to advertising functions of a firm. An advertising budget shows how much amount is to be spent on advertising and how this amount will be allocated among different media, sales territories, products, selling-activities, etcetera It states the proposed advertising phthisis and serves as a decision-making brute for the focusing while allocating av ailable cash to the diverse(a) advertising functions and related activities of the fraternity. advertizement budget and its process is convertible with the Sales Promotion budget And Integrated trade Communication (IMC) budget . All iii terms can be used interchangeably to a fault due to close similarity. Advertising budget is prepared by Advertising Manager in  interview with Marketing Manager of thecompany. But in  scummy business organizations, which do not have  discipline advertising department theresponsibility of preparing ad-budget lies on top  vigilance or Marketing Manager.According to the Institute of Cost and take Accountant London â€Å"A budget is a financial or quantitativestatement prepare precedent to a definite period of time; of the policy to be persuade during that period for the purpose of achieving a given objective”. Features of Advertising Budget The feature s of advertising budget are as follows: 1) Advertising budget is a financial statement expressed in fiscal terms, 2) It is for a specific future period. It is prepared prior to the budget period during which it will operate, 3) It is prepared by Advertising Manager.It is approved by top management for its implementation, 4) It shows the plan of allocation of available funds to various advertising activities, 5) It affects the selection of media, selection of advertising representation and selection of message source (model for advertisement), 6) Its size depends on various internal and external factors, and 7) It is a alteration factor which determines the size of advertising campaign. Advertising Budget as a Concept of Investment Advertising budget is assigned to build the take to and spirit of the organization.The achievement of the budget is observed over a long period. Some of the wasting disease on advertising attracts customers immediately;they buy the pro duct when they listen to or view the advertising message. This expenditure is known as tax incomeexpenditure. Some expenditure is incurred on building the image and reputation. The effects of advertising arerealized bit-by-bitly over a long period. This expenditure is capital expenditure or  enthronisation. The expenditure onadvertising is accepted as revenue expenditure by the income-tax authorities.The marketing manager isauthorized to control and go along the money assigned to him for advertising purpose. Advertising expenditure is a capital investment when it is incurred to build the image, saving grace and reputationof product and company; and this results in a gradual increase in the sales, although the expenditure isconsidered as revenue expenditure in the accounting entry. It is an outlay or expenditure made today to achieve benefits in future. This expenditure is known as capital investment although it is assigned under th e revenue budget barely it is not accepted as a capital budget.Factors Influencing the Size of the Advertising Budget 1) Objectives to be win: How much the company is going to spend is  opinionated by the objectives to beattained. Objectives act as the sheet key and the standards for advertising performance. These objectivesare †bringing about increase in sales, introduction of new products, supporting sales force, reachinginaccessible consumers, immersion a new market, improving dealer relations, expanding persistence’s sales, building up goodwill, building a brand preference, counter acting competition, dispelling the likelymisunderstandings and so on.It is a particular sales objective or the coif of objectives that shapes theadvertising budget. 2) Coverage Expectations: Advertising coverage implies the number of persons to be reached. It is thequestion of reaching a target audience through different media and media v ehicles. The extent of coverageis influenced very much by the nature of the market enjoyed by the products. 3) Product family: Talking of only consumer goods, these have been classified into three categories, namely, convenience, pastureping  and  specialty.In case of convenience goods, they require a large advertising expenditure because of their intensive diffusion and heavy dependence on mass advertising to sell inadvance to the prospects before they shop. On the other hand, the excogitate goods require less advertising asthe buyers can arbitrator the qualities of these products themselves in person while they hop from shop to shop. Services goods such as automobiles, fridges, washing machines, T. V sets, cooking ranges, kitchen-waresand the like warrant heavy doses of advertising and personal selling efforts. ) Stage in the Product-life wheel around: Every product has its life-cycle consisting of four phases, namely,introduction, growth, matu rity and decline. When a new product is introduced, it calls for the heaviest dosesof advertising, and therefore, the budget gets blown-up. During the growth stage, the funds spend are reallysubstantial. However, when the product reaches the stage of maturity or saturation and the stage of decline,it is the price apostrophize that works than the advertising strategy. Hence, the advertising spending gets reducedconsiderably. 5) dominant Economic Conditions: The economic activities are not eer the same.The economic systemfaces brisk and slack phases which are referred to as complete and slump phases of business cycle. During thesour economic conditions, mass of the companies cut back the advertising budget and during the periodof boom conditions, they fatter their budgets beyond limits. This has been because, the business communitythinks advertising as take place expenditure than an investment. 6) Age of the Company: A company which is seasoned and is known to the consumer s will have surely anadvantage in introducing a new product or a service. People readily accept\r\n'