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Marketing Spend Allocation - Automotive Accessories
Posted By: Tighthead on 11/16/2004 1:47 AM (CST) 125 Points
My company is emerging as the dominant automotive overlay carpet producer in our market.

We move product through 2 channels;
1. custom sets direct to automotive dealers (new & used),
2. universal sets through major retail chainstores.

This being year 1 with regards to commited, preplanned marketing, as opposed to running wildly through the trees with our heads down, I need a world class formula for determining;
1. what percentage of my marketing spend should be allocated to what component (list by component; advertising=40%, research=2.5% etc.)?
2. list of all components that should be considered essential to any marketing plan
3. what should my marketing budget be ideally, as a percentage of my turnover?

Posted by: SRyan ;] Member Response
11/21/2004 7:17 AM (CST)
I was scanning through the list of open questions here and noticed that you had ZERO responses. It's probably because you posted this on a high-traffic day on this forum and it "fell off" of the Main page.

Then again... it might be because there aren't many Experts here with experience in your industry!

I'm afraid I can't offer you much advice myself, but do take a look at some of the Q&A threads that are in the archives. Click on the Search Questions link in the right margin of this page, then try the keyword "benchmark" or "budget."

I posted some info in one of those threads that goes into some detail about allocating your budget, but it addresses high-tech.

I hope this helps!

- Shelley
 
Posted by: bobhogg Member Response
11/22/2004 5:35 AM (CST)
info...

Just like Shelley, I'd missed this question until now.

I've no direct experience in your particular market, but basing your marketing approach on an industry formula sounds dangerous to me!

You would be better to set your marketing plans and budgets based on what you are trying to achieve from a marketing point-of-view, rather than basing them on some theoretical "formula" based on %age of sales.

So, first, what are your marketing objectives? Are they all sales-volume based, or are there other objectives, such as awareness levels of your brand, customer satisfaction levels, increased trade distribution, etc.

Having set those objectives, you should have a clearer picture what needs to be done in relation to advertising, research, PR, etc. That should enable you to cost up the campaign.

Then all you need to do is negotiate that budget!!
(But then, negotiating it is easier when you have the facts to hand as to what you intend to achieve!)

Good luck,
Bob
 
Posted by: Tighthead Author Response
11/22/2004 7:12 AM (CST)
Right. Just as I thought. Innovate not imitate. Thanks guys, but I'm still hoping for something a bit more specific ito the industry.
 
Posted by: SRyan ;] Member Response
11/22/2004 7:20 PM (CST)
I took the liberty of editing your question's TITLE.  With luck, it might attract the interest of someone with the right experience to give you the answers you're looking for.

No guarantee, though, as this question is losing its freshness...
 
Posted by: SteveByrneBranding Accepted Answer
12/9/2004 7:08 PM (CST)
I would take a different approach and start by looking at your push/pull opportunities:

1. Motivating the dealers to promote/sell your brand over the competition.

2. Creating consumer brand awareness and demand, i.e. getting customers to ask for your brand.

Without knowing more (does dominant mean number one in sales?), I’d go with #1, here are some things to think about –

- Is your primary competition from the car manufactures products or aftermarket folks like yourselves. What would motivate the dealers to carry your "custom" line and promote it over competitive products. You could pursue a dealer promotional co-op program that includes advertising media dollars or resources to set up promotion displays or simple financial incentives for dealer salespeople.


- Regarding the retail chain stores, you could offer similar incentives but the big ones will prove problematical just because they’re big and typically do not offer much customer service in the stores. Great packaging and promotional displays (premium costs for the best spots) are your best bet.

As for your planning try www.mplans.com

They have great outlines that list the components for a marketing plan, plus good sample plans. Budgeting is also addressed on this site. If it were me, I’d let the planning process take me to an executable plan, roll out some part of it to confirm it works and spend what I could afford as long as the ROI was holding up.

Hope this helps and good luck,

- Steve
 
Posted by: Sanjeev Kumar Vyas Member Response
12/9/2004 9:02 PM (CST)
Hi,
Yes for your marketing plans www.mplans.com is a good place to go.
Well if I am not wrong you do not get the sales from the end user directly and currently you get orders from the dealers.
So what are your marketing objectives? Do you want to motivate the dealers to buy more or do you want the end user customers to ask for your product or what?
Then you will have to determine which will need what amount of Budget. For the budget I would suggest start from Macro view as that helps.
The industry standard can only be in things like commission standard, the breakdown of how much budget into what would change from company to company depending on their objective and since we don't know your objectives we won't be able to help that much.
Hope that helps
Regards
Sanjeev
 


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