Case Preparation

Question 1

Steps

Answer 1

see image 15

(1) identify core problem
(2) analyze situation with frameworks and marketing math
(3) Strategy and Implementation

Question 2

1 identify core problem

Answer 2

(1) Trends•Market Share•Sales Volume•Costs•Customer Tastes/Beliefs
(2) Opportunities•New Product•New Market•Change Marketing Mix
(3) Competitive Threat

Question 3

2 analyze the situation

Answer 3

Framworks
5C
SWOT
PEST
4Ps
Marketing Math

Question 4

5C

Answer 4

customer
company
collaborators
competition
context

Question 5

SWOT

Answer 5

strengths
weaknesses
opportunities
threats

Question 6

PEST

Answer 6

political
economic
social
technological

Question 7

4Ps

Answer 7

price
product
promotion
place

Question 8

marketing math

Answer 8

Unit Contribution
Break-Even
Market Share
Customer Lifetime Value

Question 9

3 Strategy and implementation

Answer 9

(1) STP
(2) consider alternatives
(3) tactical implementation 4Ps
(4) be realistic

Question 10

Profitability

Answer 10

revenus - costs = profitability

costs (variable, fixed sunk)

Question 11

sunk costs

Answer 11

unrecoverable costs
- market research, R&D expenses that have already occurredin the past
G&A, R&D, General Operating Expense

Question 12

unit contribution

Answer 12

revenue per unit - variable costs per unit

Contribution represents the portion of sales revenue that is not consumed by variable costs

Question 13

Contribution Margin

Answer 13

Relative measure of assessing unit contribution compared to selling price expressed as a %

unit contribution/revenue per unit

Question 14

Margin Analysis

Answer 14

Analyze the margins through the value chain.

(unit contribution * number units sold) - fixed costs

Question 15

break even volume

Answer 15

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

Question 16

market share

Answer 16

(1) firm sales/ total market sales
(2) firm units sole/ total market units sold
(3) firm customers/total customers

Question 17

customer lifetime value CLV

Answer 17

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.

Question 18

simplified CLV

Answer 18

annual contribution per customer * years as customer

Question 19

drawbacks of CLV simplified

Answer 19

• Discounting profits over time
• Retention Rate (mortality/attrition)
• Segments with different values/lifetimes

Question 20

retention rate

Answer 20

(change in # customers/ custermes at start) * 100

Question 21

Return on Marketing Investment

Answer 21

= (incremental gain from investment/cost of investment)

Question 22

marketing math in case analysis

Answer 22

(1) margin analysis (profitability, unit contribution, contribution margin, profit impact)
(2) breakeven analysis
(3) CLV (Simplified, complex, retention rate)