Case Preparation Flashcards
Steps
see image 15
(1) identify core problem
(2) analyze situation with frameworks and marketing math
(3) Strategy and Implementation
1 identify core problem
(1) Trends•Market Share•Sales Volume•Costs•Customer Tastes/Beliefs
(2) Opportunities•New Product•New Market•Change Marketing Mix
(3) Competitive Threat
2 analyze the situation
Framworks 5C SWOT PEST 4Ps Marketing Math
5C
customer company collaborators competition context
SWOT
strengths
weaknesses
opportunities
threats
PEST
political
economic
social
technological
4Ps
price
product
promotion
place
marketing math
Unit Contribution
Break-Even
Market Share
Customer Lifetime Value
3 Strategy and implementation
(1) STP
(2) consider alternatives
(3) tactical implementation 4Ps
(4) be realistic
Profitability
revenus - costs = profitability
costs (variable, fixed sunk)
sunk costs
unrecoverable costs
- market research, R&D expenses that have already occurredin the past
G&A, R&D, General Operating Expense
unit contribution
revenue per unit - variable costs per unit
Contribution represents the portion of sales revenue that is not consumed by variable costs
Contribution Margin
Relative measure of assessing unit contribution compared to selling price expressed as a %
unit contribution/revenue per unit
Margin Analysis
Analyze the margins through the value chain.
(unit contribution * number units sold) - fixed costs
break even volume
Break-Even Volume (BEV) is the number of units you need to sell to cover total fixed costs
Break-Even Volume = Fixed Costs / Unit Contribution
market share
(1) firm sales/ total market sales
(2) firm units sole/ total market units sold
(3) firm customers/total customers
customer lifetime value CLV
CLV: the value of the entire stream of purchases that the customer would make over a lifetime of patronage.
- the net present valueof all future streams of profitsthat a customer generates over the life of his/her business with the firm.
simplified CLV
annual contribution per customer * years as customer
drawbacks of CLV simplified
- Discounting profits over time
- Retention Rate (mortality/attrition)
- Segments with different values/lifetimes
retention rate
(change in # customers/ custermes at start) * 100
Return on Marketing Investment
= (incremental gain from investment/cost of investment)
marketing math in case analysis
(1) margin analysis (profitability, unit contribution, contribution margin, profit impact)
(2) breakeven analysis
(3) CLV (Simplified, complex, retention rate)
