Advertising Budget

AAA

DEFINITION of 'Advertising Budget'

An estimation of a company's promotional expenditures over a period of time. An advertising budget is the money a company is willing to set aside to accomplish its marketing objectives. When creating the advertising budget, a company must weigh the trade-offs between spending one additional advertising dollar with the amount of revenue that dollar will bring in as revenue.

INVESTOPEDIA EXPLAINS 'Advertising Budget'

Companies can determine what level to set their advertising budget several different ways, each of which has its positives and negatives. A business can set its budget as a percentage of sales, at the same level as its competitors, as the amount required to meet a certain objective, as the entirety of its profits or as a function of the units of product it wants to sell among others.

RELATED TERMS
  1. Parasitic Advertising

    A type of marketing that promotes one product at the cost of ...
  2. Tailored Advertising

    Marketing and advertising campaigns that place emphasis on the ...
  3. Scrambled Assortment

    A merchandise assortment strategy in which a company carries ...
  4. Accelerated Reply Mail - ARM

    An expedited delivery of business reply mail offered by the U.S. ...
  5. Infomercial

    A form of television advertisement that acts as a stand-alone ...
  6. Law Of 29

    A belief held by some marketers that on average a prospective ...
Related Articles
  1. Advertising, Crocodiles And Moats
    Professionals

    Advertising, Crocodiles And Moats

  2. How To Target Ideal Customers
    Professionals

    How To Target Ideal Customers

  3. The Lucrative World Of Third-Party Marketing
    Professionals

    The Lucrative World Of Third-Party Marketing

  4. 10 Breakout Ideas For Small Businesses ...
    Entrepreneurship

    10 Breakout Ideas For Small Businesses ...

Hot Definitions
  1. Halloween Strategy

    An investment technique in which an investor sells stocks before May 1 and refrains from reinvesting in the stock market ...
  2. Halloween Massacre

    Canada's decision to tax all income trusts domiciled in Canada. In October 2006, Canada's minister of finance, Jim Flaherty, ...
  3. Zombies

    Companies that continue to operate even though they are insolvent or near bankruptcy. Zombies often become casualties to ...
  4. Witching Hour

    The last hour of stock trading between 3pm (when the bond market closes) and 4pm EST. Witching hour is typically controlled ...
  5. October Effect

    The theory that stocks tend to decline during the month of October. The October effect is considered mainly to be a psychological ...
  6. Repurchase Agreement - Repo

    A form of short-term borrowing for dealers in government securities.
Trading Center