Question

he Chamber of Commerce periodically sponsors public service seminars and programs. Currently, promotional plans are under way for this year's program. Advertising alternatives include television, radio, and online. Audience estimates, costs, and maximum media usage limitations are as shown: Constraint Television Radio Online Audience per advertisement 140,000 18,000 30,000 Cost per advertisement $1,500 $200 $550 Maximum media usage 15 19 12 To ensure a balanced use of advertising media, radio advertisements must not exceed 45% of the total number of advertisements authorized. In addition, television should account for at least 15% of the total number of advertisements authorized. (a) If the promotional budget is limited to $24,100, how many commercial messages should be run on each medium to maximize total audience contact? Advertisement Alternatives No of commercial messages Television Radio Online What is the allocation of the budget among the three media? Advertisement Alternatives Budget ($) Television $ Radio $ Online $ What is the total audience reached? (b) By how much would audience contact increase if an extra $100 were allocated to the promotional budget? Increase in audience coverage of approximately

Answer 1

Constraint	Television	Radio	Online	Total
Audience per advertisement	140000	18000	30000
Cost per advertisement	1500	200	550
Audience per $ spent	93.33	90.00	54.55
Preference	1	2	3
Maximum media usage	15	19	12
Number of adds used	15	8		25
Budget	22500	1600		24100
Audience reached	21,00,000.00	1,44,000.00	-	22,44,000.00

a)
Advertisement Alternatives	No of commercial messages
Television	15
Radio	8
Online	=
Advertisement Alternatives	Budget ($)
Television	22500
Radio	1600
Online
Total audience reached	2244000

b)
Increase in audience coverage of approximately	6800
Audience coverage under Radio** for each $ spent = 68.
For $100 = 9800

**Maximum allocation to Television mode already done, so first priority should be given to Radio and rest to be utlized for Online