Budget Determination
After the communication objectives are determined, attention turns to the promotional
budget. Two basic questions are asked at this point: What will the promotional program cost? How will the money be allocated? Ideally, the amount a firm needs to
spend on promotion should be determined by what must be done to accomplish its
communication objectives. In reality, promotional budgets are often determined using
a more simplistic approach, such as how much money is available or a percentage of a
company’s or brand’s sales revenue. At this stage, the budget is often tentative. It may
not be finalized until specific promotional-mix strategies are developed.