In using the payout planning method of developing a marketing communications budget,the marketing budget would be reduced:

Question

Quizplus · Accepted Answer

The payout planning method involves setting a certain percentage of sales that will be devoted to marketing communications. As the brand gains market acceptance, sales increase, and therefore so does the marketing budget. However, eventually, there will come a point where additional investments in marketing communications will yield diminishing returns, meaning that further investment will not result in a proportional increase in sales. At this point, the marketing budget should be reduced to the level at which it can be maintained without resulting in a negative return on investment. This is known as the break-even point, and it is a key concept in the payout planning method. Therefore, option C is the correct answer.

In Using the Payout Planning Method of Developing a Marketing