Advertising budget setting continues to be a controversial topic. Theobjective of this study is too formulate a scientifically –based approach tosetting advertising budgets and correct the lack-lustre approach towards this.Secondary sources of data were used in this study. Data analysis was done byusing the SPSS statistical software package. This study was based on thepremise that little is known about how managers actually set advertisingbudgets and little attention is paid to this issue and managers are making less than optimal decisions on advertising budgets. It was identified thatoptimizing scientific methods were not the basis of many decisions onadvertising budget settings. It has also revealed the slowly increasing use ofquantitative models and the widespread use of heuristic such as percent-of-sales and competitive parity. Despite the controversies surrounding budgetsetting for advertisement, the study has been able to provide a leverage ofconfidence limits such that, regardless of whatever approach adopted, theconfidence limit is the guiding star towards achieving ‘optimum’ budget toreap the benefits of advertisement
