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1.1 ETHICAL DIMENSION 16
Ethical Perspective
1. Investors: Should investors be concerned only with a company’s profitability? What metrics
might an investor use to measure the social responsibility success of a company?
2. Entrepreneurs: Is a two bottom-line business model realistic in the long term? Is it
sustainable?
3. You: Would you invest in a company with a two bottom-line strategy (profitability and social
responsibility)?
1.2 KEY TERMS
marketing dashboard A comprehensive system of metrics and information uniquely relevant to
the role of the marketing manager in a particular organization. Dashboards provide managers
with up-to-the-minute information necessary to run their operation.
return on marketing investment (ROMI) What impact an investment in marketing has on a
firm’s success, especially financially.
action plans The implementation element of a marketing plan that discusses issues such as
timing, persons responsible, and resources necessary.
subjective forecasting methods Forecasting methods that do not rely primarily on sophisticated
quantitative (empirical) analytical approaches.
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user expectations Subjective method of forecasting that relies on answers from customers
regarding their expected consumption or purchase of a product.
sales force composite Subjective method of forecasting that relies on the opinion of each
member of the field sales staff.
jury of executive opinion Subjective method of forecasting that relies on a formal or informal
poll of key executives within the firm to gain their assessment of sales potential.
Delphi technique A subjective method of forecasting that is done iteratively, employing
repeated measurement and controlled anonymous feedback instead of direct confrontation and
debate among those preparing the forecast.
objective forecasting methods Forecasting methods that rely primarily on sophisticated
quantitative (empirical) analytical approaches.
market test Objective method of forecasting that involves placing a product in several
representative geographic areas to see how well it performs and then projecting that experience
to the market as a whole.
time-series analysis Objective method of forecasting that relies on the analysis of historical data
to develop a prediction for the future.
zero-based budgeting An investment approach in that marketing goals and objectives are set for
the upcoming year and then budget dollars are secured to support the achievement of those goals
and objectives.
controls Elements put in place to ensure progress is being made in the implementation of a
marketing plan. Controls must be in place from the outset of the planning process to specify the
timing, procedure, and persons responsible for systematically monitoring.
contingency planning Also called scenario planning, a planning approach that requires the
establishment of different planning options depending on the expected case, best case, or worst
case.
marketing audit A systematic review of the current state of marketing within an organization.
1.3 APPLICATION QUESTIONS
1 Pick a firm that interests you and for which you have some knowledge of their offerings.
a. How would this firm benefit from a marketing dashboard approach?
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b. What elements would you recommend they put onto their dashboard? Why do
you recommend the ones you do?
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c. How could they avoid some of the pitfalls potentially associated with marketing
dashboards?
4. Pick any two of the marketing metrics presented in the chapter. For each, pick any brand or
product and discuss how each of those brands or products would benefit from the application
of each of the marketing metrics you selected. That is, what will the information gleaned tell
them that will be useful in marketing planning?
5. Consider the Apple iPhad. Develop one complete action plan that addresses a marketing
objective to gain more iPhad purchases from 50+ year-old consumers. Be sure to complete
all the elements of the action plan as shown in Exhibit 16.3 and the accompanying
discussion.
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6. Identify one product of interest in the B2C market and one in the B2B market. Research the
products online. For each, given what you know about the product and their markets, which
forecasting approaches do you believe would be most appropriate for use in developing a
marketing plan? Which approaches would be least appropriate? What leads you to make
these suggestions?
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7. Assume that your school has decided to undertake a complete marketing audit. Review the
marketing audit instrument (Exhibit 16.10) and accompanying discussion.
a. List as many areas as you can across the entire institution that engage in
marketing activities and thus should participate in the audit.
b. As you look over the questions on the audit, do any stand out as especially
important or potentially problematic when you consider what you know about your
school and its marketing initiative?
The following are some examples:
Are customers internal, external, or both? Important because the school must recognize
that it may serve multiple constituent group (i.e., students and employers).
Who do you see as your competition? Important because the school may be having
enrollment issues.
Do you think the unit is successful at communicating your message? Important because
students may not feel that the University or College communicates effectively.
c. How would you go about actually administering the audit?
Usually the instrument and instructions would be sent to the participating organizational
units in advance, requesting that they gather the necessary background information and
materials by a certain date.
d. From your perspective as a student, what aspects of marketing do you believe
your school does well, and what aspects could use some improvement? What leads you
to these conclusions?
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MANAGEMENT DECISION CASE: Forecasting and Wannabe Blockbuster Films
Questions for Consideration:
1 In general—not just for the movie industry—when would you most likely advocate using a
jury of executive opinion or Delphi technique over the other subjective methods of user
expectations and sales force composite? Alternatively, when do you think it would be more
advantageous to rely on the user expectation and sales force composite methods? Be specific
with your discussion.
Advantages Disadvantages
Jury of executive
opinion
1. Easily done, very quick
2. Does not require elaborate
statistics
3. Utilizes collective wisdom of
the top people
4. Useful for new or innovative
products
1. Produces aggregate forecasts
2. Expensive
3. Disperses responsibility for
the forecast
4. Group dynamics operate
Delphi technique 1. Minimizes effects of group
dynamics
2. Can utilize statistical
information
1. Can be expensive and
time-consuming
User expectations 1. Forecast estimates obtained
directly from buyers
2. Projected product usage
information can be greatly
detailed
3. Insights gathered aid in the
planning of marketing
strategy
4. Useful for new-product
forecasting
1. Potential customers must be
few and well defined
2. Does not work well for
consumer goods
3. Depends on the accuracy of
user’s estimates
4. Expensive, time-consuming,
labor Intensive
Sales force composite 1. Involves the people (sales
personnel) who will be held
responsible for the results
2. Is fairly accurate
3. Aids in controlling and
1. Estimators (sales personnel)
have a vested interest and
therefore may be biased
2. Elaborate schemes sometimes
necessary to counteract bias
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directing the sales effort
4. Forecast is available for
individual sales territories
3. If estimates are biased,
process to correct the data
can be expensive
8. Suppose you are assigned the task of developing the ticket sales forecast for the next Hunger
Games movie. What methods of forecasting will you use and how will you justify that choice
to studio executives?
The user expectations method of forecasting is also known as the buyers’ intentions method
because it relies on answers from customers regarding their expected consumption or
purchases of the product. The user expectations method may provide estimates closer to
market or sales potential than will other approaches.
9. Many studio executives believe producing a movie that builds on a franchise that has already
been established in a different medium, such as comic books and Iron Man or toys and
Transformers, reduces the risk of a blockbuster flop. How do you think a character in a
popular comic book series or a popular line of toys may influence a ticket sales forecast for a
movie based on the character or toy? That is, how would you suggest incorporating that
aspect into developing a forecast for the film?
The key aspect of the impact of the character or toy on movie viewers is generally a direct
relationship with the relative popularity of the character or toy in its respective market. The
main source of excitement for the movie would come from the most ardent fans. Therefore,
the greater the number of ardent fans, the greater the likelihood of movie success.
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