Competitive-Parity Method

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Definition: Competitive-Parity Method

It is one of the techniques to establish the total marketing communication budget. The method takes the total budget to be allocated for marketing communication at par with what competitors spend on the same.
Such a method is not considered very accurate because :

-          The competitor might not be knowing the right thing

-          The communication budget for a company might also differ from its competitor due to factors like company reputation, resource, opportunities and objectives

Example:

If HUL is using ‘x’ amount for promotions of its luxury soap brand, P&G will also allocate an amount almost equal to ‘x’ for a similar brand.

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