Advertising and Promotion Investment: What Is the Right Level?
Forker, Olan D.
Agricultural economists in both the United States and Canada have been trying to answer this complicated question for over 12 years. Although there is no simple answer t researchers generally agree that the "right level" of advertising investment is a function of the promotion program's objective. The actual level of advertising investment in 1987 totaled $490 million in 22 dairyproducing countries. The United States t Canada t Australia t and the United Kingdom have similar levels of promotion investment per unit of milk production ($0.12 to $0.17 per hundredweight). A review of economic studies "indicates commodity advertising investment in the U.S. is probably less than optimum at its current level of around $145 million.
Charles H. Dyson School of Applied Economics and Management, Cornell University