978-0078028946 Chapter 13 Solution Manual

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Chapter 13 – Measuring and Delivering Marketing Performance

End of Chapter Discussion Questions and Answers

1. MTS Systems Inc. is a relatively small manufacturer of measurement instruments used

to monitor and control automated production processes in a number of different

industries, such as autos and aerospace. The firm has 12 salespeople, each of whom

calls on companies in a particular industry. While the firm’s sales have increased

steadily in recent years, its profits have been relatively stagnant. One problem is that

the firm has no information concerning the relative profitability of the various

products it makes or the different customers to whom it sells. MTS Systems has hired

you as a marketing consultant to design a performance measurement system that will

enable the firm to evaluate its performance across the various items in its product line

and the various segments of its market. As if you were a marketing consultant, outline

the major marketing metrics you would recommend including in such a system.

Answer:

Answers should focus on profitability analysis. The insights offered by the text include the

following:

The profitability analysis requires that analysts determine the costs associated with specific

marketing activities to find out the profitability of such units as:

Different market segments

The system should be designed to collect data in these four areas.

Students may also address the following limitations:

Many objectives can best be measured in nonfinancial terms (e.g., customer

satisfaction)

2. What specific types of information would have to be collected and evaluated in order to

implement the system you outlined in your answer to question 1? What sources could

be used to obtain each necessary type of information?

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Chapter 13 – Measuring and Delivering Marketing Performance

Answer:

Student answers may vary. Answers may contain the following elements:

3. After finishing your report, including the types of information needed (see question 2),

you decide to develop a dashboard of performance metrics to be used by the top

management team to evaluate the drivers of the firm’s success. These measures would

be used with the system you recommended. Outline the contents of this “addition,”

making sure you give examples of your individual recommendations.

Answer:

Student answers may vary. Answers may contain the following elements:

Since the dashboard is aimed at top management, the question of for whom the metric

should be designed is already answered.

The dashboard should concentrate on the profit generated in the following groupings:

Geographical areas—regions, counties, and sales territories

An array of such metrics can aid top management in identifying patterns of profitability and

trouble spots that need attention.

4. You are a marketing manager in an SBU of a large consumer food manufacturer. The

SBU’s general manager has asked you to conduct a marketing audit of the SBU as a

basis for evaluating its strategic and operations strengths and weaknesses. What issues

or areas of concern should be covered by your audit? After completing your marketing

audit, you are asked to develop a contingency plan for the SBU’s major product line.

Provide an outline of what the plan should cover.

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Chapter 13 – Measuring and Delivering Marketing Performance

Answer:

Student answers may vary. The insights offered by the text notes include the following:

Marketing audits are both a control and planning activity that involves a comprehensive

However, it seems that other types of audits should also be performed including:

Marketing environment audit—requires an analysis of the firm’s present and future

Planning and control system audit—evaluates the adequacy of the systems that

Organization audit—deals with the firm’s overall structure, how the marketing

Marketing productivity audit—evaluates the profitability of the company’s individual

Marketing functions audit—examines, in depth, how adequately the firm handles each

The contingency plan should address problems that might affect the major product line that

may arise from the environment, the firm’s planning and control systems, its organizational

structure, its marketing productivity or how well it performs the marketing functions.

The text says that the marketing functions audit examines, in depth, how adequately the firm

handles each of the marketing-mix elements.

Questions relating to the product concern the attainability of the present product-line

Price questions have to do with price elasticity; experience effects, relative costs, and

Distribution questions center on coverage, functions performed, and

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Chapter 13 – Measuring and Delivering Marketing Performance

Questions about advertising focus on advertising objectives and strategies, media

The audit of the salesforce covers its objectives, role, size, coverage, organization, and

Addressing these issues should provide the requested contingency plan.

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manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.