A Decision Framework for Allocating Advertisement Budget to Online and Offline Channels

Companies use various advertising channels-such as online platforms, TV, newspapers, radio, and billboards-to promote their products and services.Selecting the right mix is challenging due to budget constraints and audience segmentation.Deciding the target or focus group is crucial, as it influences channel selection.Segmentation can be based on factors like age, income, gender, and education.This study aims to optimize advertising budget allocation by incorporating segmentation weights provided by companies.Using five optimization models-maximum exposure, minimum cost, minimax, maximin, and compromise programming-the research identifies the most efficient strategy.Results from the Nielsen case show that the compromise programming model best balances exposure and cost, making it the most effective approach for budget allocation.