Abstract
The rising cost of an industrial sales call underscores the need for integration of personal selling with other modes of industrial communication, notably advertising, within the overall context of efficient resource deployment. The authors propose an approach to assess the joint impact of advertising and personal selling effort on sales of a mature industrial product and thereby to plan the overall communications budget and its split between advertising and personal selling. Through an empirical application, they demonstrate the estimation of a communications response model and its use as an input to the planning process. In the illustration, the model's recommendation calls for an increase in the total communications budget over the current level, as well as some reallocation among its elements, based on a multiperiod profit-maximizing objective. Finally, to obtain a more general understanding of communications budgeting under different market situations, the authors employ the model to investigate analytically the impact of key market factors on the optimal level and allocation of communications effort.
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