Several methods can be used to set an advertising budget:
Percentage of Sales Method: Allocate a fixed percentage of the projected sales revenue to advertising. This method is simple but may not always align with market conditions. Objective and Task Method: Define specific objectives and estimate the cost of achieving them. This method is more precise but requires detailed planning. Competitive Parity Method: Set the budget based on competitors' spending. This ensures you remain competitive but may not consider your unique needs. Affordable Method: Allocate what you can afford after covering other expenses. This is risk-averse but may limit growth potential.