Marketing communication budget practices in South Africa

• Published in: Communicatio Vol. 30; no. 1; pp. 166 - 174
• Main Author: Tustin, Deon H
• Format: Journal Article
• Language: English
• Published: Taylor & Francis Group 01.01.2004
• DOI: 10.1080/02500160408537992
• ISSN: 0250-0167

International experience shows that the correct composition of a marketing communication budget is essential in building long-term brands. Trends in the United States of America (USA), for example, show that the composition of the marketing communication budget is positively skewed towards promotional spend (e.g. direct marketing, promotions, sponsorship and pubic relations). However, experience shows that high promotional spend at the cost of advertising spend (television, radio, magazine, outdoor and cinema advertising) might put long-term sales volumes and branding at risk. With evidence mounting that the marketing communication spend in South Africa is gradually showing a preference for promotional spend at the cost of advertising, fears of marketing communication practitioners that South African firms are buying short-term sales and market share at the expense of long-term brand equity, have increased. To investigate the validity of such fears a primary research study was conducted amongst 250 marketing/brand managers to profile current marketing communication budget practices in South Africa. Resolving the research problem at hand was largely dependent on the validity of the hypothesis which stated that promotional spending in South Africa has reached levels of more than half of the total marketing communication spend in South Africa. The survey results revealed that, on average, a 59/41 ratio currently prevails between advertising and promotional spend in South Africa. This finding contradicts the stated hypothesis and for now, at least, allays the previously mentioned fears of marketing practitioners. However, with the tendency of brand companies to increase promotional spend, budgeters are warned against the long-term risk of promotional spending at the cost of advertising. Because the study also features the most prominent marketing communication tools used and integrated to market products and services in South Africa over the long term, the findings serve as a benchmark for marketing and brand managers when constructing annual marketing communication budgets.