Advertising pp 30-60 | Cite as

Decisions of Advertising Management

  • W. Duncan Reekie


Advertising is suspected of being in excess of both its social and commercial optimum level. Profit-maximising businessmen have no reason to carry the activity beyond the point where the last pound spent on advertising brings in exactly one pound more of net revenue. Yet the late Lord Leverhulme’s statement suggests that they do exceed this point. Why should this be? How do businessmen decide on their advertising budget levels? How do they allocate their budget among the various media available? This chapter is concerned with providing answers to these questions.


Sales Level Advertising Expenditure Advertising Cost Budget Line Advertising Budget 
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  1. 1.
    W. J. Baumol, Business Behaviour, Value and Growth (Prentice-Hall, 1958).Google Scholar
  2. 2.
    P. J. Verdoorn, ‘Marketing from the Producer’s Point of View,’ Journal of Marketing (Jan 1956) pp. 221–35.Google Scholar
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    J. Dean, Managerial Economics (Prentice-Hall, 1951).Google Scholar
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    O. E. Williamson, The Economics of Discretionary Behaviour (Prentice-Hall, 1964).Google Scholar
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    I. Feller, ‘Production Isoquants and the Analysis of Technological and Technical Change’, Quarterly Journal of Economics (1972).Google Scholar
  6. 6.
    P. Kotler, Marketing Management, 3rd ed. (Prentice-Hall, 1972) p. 677.Google Scholar
  7. 7.
    See T. Joyce, ‘What Do We Know About How Advertising Works?’, ESOMAR Seminar (1967).Google Scholar

Copyright information

© W. Duncan Reekie 1974

Authors and Affiliations

  • W. Duncan Reekie
    • 1
  1. 1.Department of Business StudiesUniversity of EdinburghUK

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