Flamingo's management team accepted maximizing the total exposure rating, across all media, as the objective of the advertising campaign Because of management's concern with attracting new customers, management stated that the advertising campaign must reach at least 100,000 customers. As expected, the more expensive television advertisement has the highest exposure effectiveness rating along with the greatest potential for reaching customers. It is a function of such things as image, message recall, visual and audio appeal, and so on. The exposure rating is viewed as a measure of the value of the ad to both existing customers and potential new customers. In a meeting with HJ consultants, Flamingo's management team provided the following information about the industry exposure effectiveness rating per ad their estimate of the number of potential new customers reached per ad, and the cost for each ad. The management team requested HJ's recommendation concerning how the advertising budget should be distributed across television, radio, and newspaper advertisements. To help plan an advertisement campaign for the coming season, Flamingo's management team hired the advertising firm of Haskell & Johnson (HJ).
This is despite a drop in exposure rating to 2,130.The Flamingo Grill is an upscale restaurant located in St. What is your recommendation for the Flamingo Grill's advertising campaign? Maximizing the number of new customers is the best option because the potential new customers will increase from 127,100 to 139,600. Compare the recommendations from parts 1 and 4. Develop the media schedule under this objective. After reviewing HJ's recommendation, the Flamingo's management team asked how the recommendation would change if the objective of the advertising campaign was to maximize the number of potential new customers reached. Furthermore, the shadow price of the radio and newspaper ads are in small multiples (.0012 and -.0005) to even make a significant impact on the maximum exposure.Ĥ. The degree of sensitivity for the maximum exposure coefficient is low because it is a non-binding (constraint 10 =0). What do the ranges indicate about how sensitive the recommended solution is to HJ's exposure rating coefficients? A discussion of the ranges for the objective function coefficients.
FLAMINGO GRILL ADVERTISING CAMPAIGN LINEAR PROGRAMMING TV
Based on the LP solution, only one TV ad will be added given the additional $ 10,000.
How would the total exposure change if an additional $10,000 were added to the advertising budget? The exposure rating would increase to 2,215 from 2,160. A schedule showing the recommended number of television, radio, and newspaper advertisements and the budget allocation for each media. The objective of the advertising campaign is to maximize the total exposure rating across all media. The following information was provided by H&J: Advertising Medium TV1 TV2 RD1 RD2 NP1 NP2Ĭost per Ad $ 10,000 10,000 3,000 3,000 1,000 1,000 Introduction The Flamingo Grill’s management team hired the advertising firm Haskell & Johnson to recommend the optimal advertising mix of television, radio and newspaper ads given a budget of $279,000.00. Advanced Decision Science Flamingo Grill - Linear Programming Case
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