StudentShare solutions
Triangle menu

Virgin Blue Budgeting Method for Advert - Essay Example

Free

Extract of sample
Virgin Blue Budgeting Method for Advert

Budgeting Methods In any such marketing campaign the amount to be spent (budget) can be arrived at in more than one ways. Companies can decide on the advertising budget by using any of the following methods; percentage-of-sales-method, share-of-voice parity and the objective-and-task method. Percentage of Sales Under this method the promotional expenditure is set at a specified percentage of sales, either current or anticipated. As per the audited annual results of the company, Virgin Blue reported revenue of AUS$2.9 billion in 2010. The airline may set aside; say 3 percent or AUS$ 8, 70,000, of its revenue for advertising. As a practical application this should be the annual spend of the company. Since this particular campaign is to run for a 2-week period and is specifically meant to target the business class, a better approach would be to take out a percentage from the projected additional revenue that the business class would provide. The website of Virgin Blue reveals that the airline carried 13, 73,053 domestic passengers in 2010. Assuming an equal spread throughout the year this translates to 1, 14,421 customers in a month and 57, 210 in a fortnight. If the proposed advertising campaign targets an additional 5 percent customers (5% of 57, 210 i.e. 2860) from the business class in the fortnight after the campaign and these 2860 customers pay, on average AUS$ 300 as fare, an amount of AUS$ 8, 58,000 (2860*300) would be generated as additional revenue. Even if the airline spends the

Check these samples - they also fit your topic

Budgeting
This paper will discuss budgeting with respect to the construction industry. It will describe the functions of budgeting along with the role of budgeting in motivating behaviors within organizations. We will also discuss how potential dysfunctional consequences arise from the actions that budget holders may take when they are responsible for the budget.
8 pages (2000 words) Essay
Budgeting
However, the way to report should adhere to set international financial reporting standards. A financial reporting system is unique to a company and should be made in such a way that it does not contravene the set standards. A financial reporting system uses financial statements thus encompasses characteristics and components of such financial statements.
3 pages (750 words) Essay
Blue
Blue holds a strong position in the lives of people as their roof is blue sky and life is blue water .In a way we are all existing on a blue planet. Blue has the property of coolness and calmness to it and promote peace and happiness. The blue sky above us and the blue water rising as waves in the ocean all has great meaning to our lives and this could be the reason which made blue a universal theme Blue is regarded as the symbol of strength, happiness and freedom and hence it is used mostly in political and defense arena.
5 pages (1250 words) Essay
Budgeting
Budgeting Introduction:Budgeting plays an important role in a business. It is very significant for the reason that it permits the firm to ensure of how much credit it may provides to consumer before it begins to have liquidity troubles. “Cash budget is an opinion of inflow and outflow of the business of an organization for a particular period of time” (Foley 2009).
3 pages (750 words) Essay
Budgeting
It generally provides considerable assistance in identifying the dimensions of business functions that need more attention to be upgraded and delivers a rational idea regarding the unnecessary expenses incurred within a particular organization with the motive of preserving financial effectiveness.
10 pages (2500 words) Essay
Budgeting
Moreover, in times of today budgets are not to be considered static, over a period of time they need to be reviewed and rolled over. There is no denial of the fact that 'failing to plan' results in 'planning to fail'. Budgets prepare organizations to anticipate the future and plan accordingly, which eases their anticipation for the future and day to day needs are already planned earlier.
4 pages (1000 words) Essay
Blue
Blue has the property of coolness and calmness to it and promote peace and happiness. The blue sky above us and the blue water rising as waves in the
5 pages (1250 words) Essay
Budgeting
Preparing a monthly budget includes recording of all possible incomes in the month, and listing of all fixed expenses like rent, telephone and utilities, and then last is the listing of variable expenses. This way, you can find the
1 pages (250 words) Essay
Budgeting
In order to determine achievable budgetary targets, both the organisation and managers should sit together and determine realistic and achievable budgetary targets. For this purpose, the managers should show their consent for achieving the
2 pages (500 words) Essay
Persuasive method of Tesco Christmas Advert 2014 - Lights on
The other end of the pen will exhume fast moving white gases. Body copy: We have been in the market for the last 65 years, we know what you need and we have it. Do not just write but write like a professional. Use Gen writing pen. The pen assures
5 pages (1250 words) Essay
entire amount on advertising, it still gains over an annualized basis as some of these passengers would continue to fly with the airlines in the future as well and would thus be a source of revenue. Share of Voice Horton (2011) reveals that Virgin Blue holds merely 12 percent market share in the business segment. On the other hand Qantas dominates the segment with a mammoth 88 percent market share. If the challenger (Virgin Blue) was to set its promotional budget to achieve share-of-voice parity with competitors, the advertising budget would be minimal and would not serve the intended purpose. Akin to new products that typically need large advertising budgets to build awareness and gain consumer trial, Virgin Blue needs to advertise on a large scale to induce the business class to fly the airline. The company’s low market share in this segment warrants high spending, so it is not appropriate to set the budget according to this method. Objective and task method To ensure that the airline is able to reach and attract the targeted segment, it is imperative that the airline should go in for an assorted media mix. The advertisements should be placed in the electronic as well as the print media. The media vehicles have to be chosen keeping in mind their readership and the demographic profiles of their viewers. The setting of the advertising budget with the help of objective and task method has been detailed below. The campaign will kick off with advertisements on The Australian, Australian Financial Review, The Sydney Morning Herald and The Age. The print advertisement will also be placed in The Deal (Friday), Australian Golf Digest and the Weekend Australian Magazine. The cost that will be incurred in the print media is as under: Media Vehicle Placement Cost (AUS$) The Australian (Mon-Fri) Business Package (Everyday) 20,228 The Weekend Australian (Sat) Horizontal Half Page 91,530 The Deal (Fri) Double Page Spread 38,032 Australian Golf

Summary

Virgin Blue Budgeting Method for Advert Virgin Blue has made its presence felt in the leisure segment of the Australian airline industry ever since it jumped into the fray a decade ago. Now the airline intends to grab a bigger pie of the business segment in which Qantas holds the numero-uno position…
Author : bkemmer
Virgin Blue Budgeting Method for Advert essay example
Read Text Preview
Comments (0)
Click to create a comment
Contact Us