Module 19 - Measuring and Delivering Marketing Performance Flashcards
31 A corporate-level periodic review of a company’s total marketing effort that cuts across all products and businesses is referred to as a:
A.marketing-management control system.
B.strategic-marketing-evaluation programme.
C.marketing-effort evaluation.
D.marketing audit.
E.market-performance-control programme.
D
32 Assessing opportunities/threats that emerge from outside the firm would be included as part of a(n) ____ area audit.
A.strategic.
B.marketing-functions.
C.marketing-environment.
D.organisation.
E.marketing-productivity.
C
33 A ____ is broader in scope and reflects a longer time frame than does a ____.
A.profitability analysis; marketing audit.
B.sales analysis; marketing audit.
C.marketing audit; sales analysis.
D.product analysis; sales analysis.
E.channel audit; product analysis.
C
34 Analysing transportation costs would be part of a(n) ____ audit.
A.marketing-productivity.
B.strategic.
C.planning and control system.
D.marketing-environment.
E.organisation.
D
35 A typical question that might be asked in the objectives and strategy area audit would be:
A.How valid is the firm’s business approach given the anticipated competitive environment?
B.How profitable are each of the firm’s products/brands?
C.How effective are each of the major marketing activities?
D.Is the firm allocating its marketing dollars most effectively?
E.How well does a product line meet the objectives of that line?
A
36 The primary thrust of the marketing-functions area audit is to examine the:
A.firm’s product-market entry action plans.
B.formal overall structure of the marketing department.
C.profitability of the company’s products, markets and key accounts.
D.way in which the firm manages each of the marketing-mix elements.
E.company’s present and future environments.
D
37 What type of audit attempts to answer the question: ‘Do we have good information about consumers’ satisfaction with our products?’
A.Organisation audit.
B.Productivity audit.
C.Marketing-environment audit.
D.Planning and control system audit.
E.Objectives and strategy audit.
D
38 Which type of audit attempts to answer the question: ‘How profitable are each of our brands?’
A.Marketing-environment audit.
B.Objectives and strategy audit.
C.Organisation audit.
D.Productivity audit.
E.Planning and control system audit.
D
39 The sales manager for the Alpha Corporation is looking for information that will help him evaluate the company’s salespeople. Where would be the best place to begin looking for that information?
A.Sales staff call reports.
B.Credit memos for returns and allowances.
C.Customer surveys.
D.Syndicated subscription research firms.
E.Sales invoices.
E
40 The final step in the contingency planning process is:
A.assigning probabilities.
B.rank ordering the critical assumptions.
C.tracking the critical assumptions.
D.specifying alternative response actions.
E.none of the above.
D
1 The most frequently used performance standard is:
A.market share.
B.unit sales.
C.cost structure.
D.competitive position.
E.profitability
E
2 When a company compares some dimension of its performance to that of another firm, be it a competitor or in a totally different industry, this is known as:
A.profitability analysis.
B.indirect cost analysis.
C.direct cost analysis.
D.benchmarking.
E.contribution margin analysis
D
3 Profitability analysis involves studying the costs and profitability of:
A.products.
C.intermediaries.
D.market segments.
E all of the above.
E
4 When an accounting department assigns both variable and indirect costs to a given market segment, this is known as:
A.indirect costing.
B.direct costing.
C.full costing.
D.contribution margin analysis.
E.activity-based costing.
C
5 If a firm wishes to determine the profit impact of selling to a non-traditional customer it may get the most accurate answer by using:
A.activity-based costing.
B.benchmarking.
C.a direct cost analysis.
D.a full cost analysis.
E.an indirect cost analysis.
A
6 To properly develop an indicator of customer satisfaction a firm must first ____ and then ____.
A.assess how well it is doing; compare itself to competitors.
B.assess how well it is doing; compare itself to benchmark standards.
C.identify the determinants of satisfaction; have customers rate its performance.
D.identify the determinants of satisfaction; compare itself to competitors.
E.identify the determinants of satisfaction; compare itself to benchmark standards
C
7 ‘The number of stockouts’ of a given package size for a particular brand is an example of:
A.a contribution measure.
B.an indirect measure.
C.a performance measure.
D.a P&L measure.
E.a gross margin measure.
C
8 The most important use of feedback data is to:
A.determine the sales commissions to be paid to salespeople.
B.assess the labour costs associated with manufacturing a product.
C.determine if inventory costs were as anticipated.
D.identify where actual outcomes significantly deviated from projections.
E.assess the effectiveness of advertising expenses
D
9 The sequential steps of the strategic control process are:
A.identify key variables, strategy reassessment, competitive position control and variance decomposition.
B.identify key variables, competitive position control and variance decomposition.
C.identify key variables, tracking and monitoring, and strategy reassessment.
D.identify key variables, strategy reassessment and competitive position control.
E.none of the above.
C
10 For a contingency plan to be useful it must be ____ and triggers must be ____.
A.consistent / fairly vague
B.consistent / precisely defined
C.activated / fairly vague
D.activated / precisely defined
E.accurate / contingent upon actual events
D
What are the major steps in the control process?
control processes consists of the following steps
- setting standards of performance
- specifying the necessary feedback data
- obtaining the needed data
- evaluating feedback data – explaining gap between actual and given standards of performance
- taking corrective action
Why are more and more firms using non-financial control measures in addition to the traditional financial-based measures? What are some of the more commonly used non- financial measures?
Recent years have witnessed a shift from using primarily financially based per- formance measures to treating them as simply part of a broader array of marketing metrics. The now widely used balanced scorecard is one such approach. While the use of nonfinancial measures is not new, giving them equal or greater status is. Thus, more and more companies are turning to metrics they feel better reflect how their managers think about what decision areas drive the firm’s success, such as customer satisfaction, product quality, market share, and new product development.
Recent trend to use non financial performance indicators e.g. balanced scorecard - customer satisfaction, product quality and new product development
Describe the use of benchmarking as a performance type of measure
benchmarking – firms performance in a given area is compared to performance of other similar companies
What are the advantages of using the contribution method to determine a product’s profitability?
Direct costing involves the use of contribution accounting. Those favouring the direct costing approach argue there is really no accurate way to assign indirect costs. Further, because indirect costs are mostly fixed, a product or market may make a contribution to profits even if it shows a loss. Thus, even though the company must eventually absorb its overhead costs, the contribution method clearly indicates what is gained by adding or dropping a product or a customer.
Contribution analysis is helpful in determining the yield derived from the applica- tion of additional resources (for instance, to certain sales territories).
What does strategic control hope to accomplish?
the questions a strategic control system should answer
- what changes in the environment have negatively affected the current strategy
- what changes have major competitors made in the objectives and strategies
- what changes have occurred in the industry – capacity, entry barriers
- what new opportunities or threats have occurred
- what changes have occurred in the industry’s key success factors
- to what extent in the firms current strategy consistent with the preceding changes
Use the data presented in Exhibit 19.5 in the text. As new marketing manager, you believe the product’s net sales could be increased by $250 000 by taking the following actions:
(a) increase advertising by $45 000;
(b) add one more salesperson at a total cost of $60 000; and
(c) improve delivery time to customers by spending an additional $25 000 on order processing and warehousing for the product. If the product’s cost of goods sold does not change, what would be the effect of these actions on the product’s contribution margin? What would be the original effect on pretax profits?
An alternative to the actions described in Question 19.39 would be to increase the advertising promotion budget by $70 000 without making any changes in the salesforce or the logistics system. It is estimated that such an increase in advertising would generate an additional $130 000 in net sales. Which alternative should be adopted?
