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13. The technique of swot analysis, its implementation

SWOT analysis is a strategic planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or in a business venture. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieve that objective. SWOT analysis must first start with defining a desired end state or objective.

  • Strengths: attributes of the person or company that are helpful to achieving the objective(s).

  • Weaknesses: attributes of the person or company that are harmful to achieving the objective(s).

  • Opportunities: external conditions that are helpful to achieving the objective(s).

  • Threats: external conditions which could do damage to the objective(s).

14. Marketing budget and control in marketing planning

A marketing budget is an estimate of projected costs to market your products or services. A typical marketing budget will take into account all marketing costs e.g. marketing communications, salaries for marketing managers, cost of office space etc. The costs in a marketing budget will be allocated according to the campaign and the media to be utilized. Some prior research will be necessary for the cost estimates to be as realistic as possible. This is called advertising or marketing communications research.

There are several allocation methods:

  • Percentage of Sales method - an advertiser takes a percentage of either past or anticipated sales and allocates that percentage of the overall budget to advertising.

  • Objective and Task method - a business needs to first establish concrete marketing objectives, often articulated in the "selling proposal," and then develop complementary advertising objectives articulated in the "positioning statement." After these objectives have been established, the advertiser determines how much it will cost to meet them.

  • Competitive Parity method - if a business is aware of how much its competitors are spending to advertise their products and services, the business may wish to budget a similar amount on its own advertising by way of staying competitive.

  • Market Share method - a business equates its market share with its advertising expenditures.

  • Unit Sales method - method takes the cost of advertising an individual item and multiplies it by the number of units the business wishes to sell.

  • All Available Funds method - involves the allocation of all available profits to advertising purposes.

It is important to notice that most of these methods are often combined in any number of ways, depending on the situation.

Budgetary control and responsibility centres. These enable managers to monitor organisational functions. A responsibility centre can be defined as any functional unit headed by a manager who is responsible for the activities of that unit. There are four types of responsibility centres: a) Revenue centres b) Expense centres c) Profit centres d) Investment centres

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