BUSI 430 Week 2 Discussion Board Forum 1 Example

Discussion Board Forum 1: Promotions Opportunity Analysis

BUSI 430 Promotion Strategy, Discussion Board Forum 1 Thread and Reply

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The forum prompt, the gym and the classmate are composites; the textbook and the research cited are real, and the structure follows Liberty's public course guide for BUSI 430.

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Clow and Baack (2018) describe a promotions opportunity analysis as the process of identifying the audiences a business can reach and the opportunities its communications can exploit, before any ad is created. The steps run from a communication market analysis, examining competitors, opportunities, target markets, customers and positioning, to establishing objectives, creating a budget, and preparing strategies and tactics.

Consider an independent gym competing with two national chains. Its communication market analysis would find that the chains win on price and convenience, while the gym's members value small classes and coaches who know their names. Its best opportunity is adults over forty who feel intimidated by large gyms. Its position follows: a coached, welcoming gym for people starting over.

I want to argue that the next step, setting objectives, is the one small businesses most often skip and the one that decides whether everything after it can be judged. Most owners jump from "we need more members" to choosing Facebook ads. Without a specific communication objective, such as raising awareness among local adults over forty from 10 to 30 percent in six months, or booking eighty free trial classes in a quarter, there is no way to choose media, set a budget or know whether the campaign worked. An objective turns a hope into something the plan can be measured against.

Research also suggests objectives should fit the customer's decision. Vakratsas and Ambler (1999) reviewed decades of studies on how advertising works and found little support for strict models in which consumers always move from awareness to liking to purchase. Sometimes people try a product first and form attitudes afterward. For the gym, that argues for an objective built around trial, a free class, rather than awareness alone, since many people will decide how they feel about the gym only after walking in. The objective also tells the gym what to stop doing: if trial is the goal, spending on broad brand ads that never mention the free class would be hard to justify.

Reply to Brandon

Brandon, your promotions opportunity analysis for the food truck was thorough, especially your communication market analysis showing that lunch crowds near the office park are the truck's best opportunity. I want to engage with your budget, though, which you set at 5 percent of last year's sales. Clow and Baack (2018) describe the percentage-of-sales method as common because it is simple, but they point out its logical problem: it makes sales determine advertising rather than advertising determining sales. If the truck had a slow year, the method would cut promotion exactly when the business most needs to attract customers.

The textbook's objective-and-task method would start from your objectives instead. If the goal is to have 300 office workers follow the truck's social account so they know where it will park each day, you would list the tasks, such as two months of geotargeted posts, a launch-day discount and flyers in building lobbies, then cost each one. A slow month would then prompt a question about which task to strengthen, not an automatic cut. The budget becomes the sum of the tasks, and you can see exactly what each dollar is meant to do.

There is a second reason to tie the budget to specific tasks. Sethuraman et al. (2011) combined decades of studies and found that advertising's average short-term effect on sales is modest, with an elasticity of about 0.12. Small effects like that are easy to waste on spending with no clear purpose. A task-based budget makes it easier to see which activities are working and shift money toward them. It also forces a useful conversation about priorities, since the owner must decide which tasks matter most when the total exceeds what the truck can afford. Would your truck's current budget cover the tasks your objectives require, or would the objectives need to change?

References

Clow, K. E., & Baack, D. (2018). Integrated advertising, promotion, and marketing communications (8th ed.). Pearson.

Sethuraman, R., Tellis, G. J., & Briesch, R. A. (2011). How well does advertising work? Generalizations from meta-analysis of brand advertising elasticities. Journal of Marketing Research, 48(3), 457-471. https://doi.org/10.1509/jmkr.48.3.457

Vakratsas, D., & Ambler, T. (1999). How advertising works: What do we really know? Journal of Marketing, 63(1), 26-43. https://doi.org/10.1177/002224299906300103