Which advertising budgeting method uses competitors' budgets as benchmarks and relates the amount invested in advertising to the product's share of market?

Question

Quizplus · Accepted Answer

The method described in the question is competitive budgets. This method involves using competitors' budgets as benchmarks and relates the amount invested in advertising to the product's share of the market. The historical method looks at past advertising expenses to determine the budget, while the percentage-of-sales method calculates the budget as a percentage of sales. Benchmarking and comparative budgets are similar to competitive budgets, but they do not necessarily use competitors as benchmarks.

Which Advertising Budgeting Method Uses Competitors' Budgets as Benchmarks and Relates