Explain 4 Methods Of Preparing Advertising Budget

• Percentage of sales method:-

In this method advertising budget is linked with the total sales of the previous year.

• Unit of sales method:-

In this method the calculation of the budget is made as per the units sold or the total volume of sales taken place in the previous period.

• Competitor expenditure method:-

This is also called as competitive parity method. It is based on the expenditure incurred by competitors on advertising.

• Market share method:-

In this method the advertising budget is decided on the basis of the market share of the company in a particular product category.