Net marketing contributionmarketing by the nurnbers

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Net Marketing Contribution

Marketing by the Nurnbers, discusses other marketing profitability metrics beyond the return on marketing investment (marketing ROI) measure described in this chapter. Below are profit¬and-loss statements for two businesses. Review Appendix 3 and answer the questions below.

1. Calculate marketing return on sales (or marketing SOS) and rnarketing return on investment (or marketing ROI) for both companies as described in Appendix 3.

2. Which company is doing better overall and with respect to marketing, Explain.

Business A

 

 

Net Sales

 

S800.000.000

Cost of goods sold

 

375.000.000

Gross Margin

 

S425.000.000

Marketing Expenses

 

 

Sales expenses

$70000000

 

Promotion expenses

30,000.000

 

 

 

100.000.000

General and Administrative Expenses Marketing salaries and expenses

S10.000,000

 

Indirect overhead

80.000.000

90.000.000

Net profit before income tax

 

9235,000,000

Business B

 

 

N. Sales

 

S900,000,000

Cost of goods sold

 

400,000.000

Gross Margin

 

S500,000,000

Marketing Expenses

 

 

Sales expenses

$90,000,000

 

Promotion expenses

50,000,000

140,000,000

General and Administrative Expenses

 

 

Marketing salaries and expenses

S 20,000,000

 

Indirect overhead

100,000,000

120,000.000

Net profit before income tax

 

0240,000,000

Reference no: EM13372342

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