MARKETING
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ISBN: 9780135286487
Author: Armstrong
Publisher: PEARSON
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Chapter 12, Problem 12.13MA
Summary Introduction
Case summary:
The advertiser using percent on sales method set his advertising budget on present or forecasted sales. But, percentage is not clear. Marketers view industry average and competitor spending for evaluation. Websites and other trade publications give data about the industries that help the marketer to set the percentage.
The Company G is the number 2 auto insurer with revenue of $17 billion the previous year. Company G spends $1.1 billion on advertisement at present and continues to spend the same percentage next year. The average advertising to sales rate for I Industry is 0.1 %.
Characters in case:
Company C
Industry I
Introduction:
Percentage of sales method helps to fix the percentage of the present sales or future sales. It is based on the availability of resources than opportunities.
To determine: The amount that the Company G will budget for advertisement on projected sales.
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