Effectiveness of marketing expenditures: A brand level case study

Abstract

Marketing efforts often have not been subjected to the same rigorous analysis and evaluation that is routinely applied to the other areas within a firm. There is an increasing concern that these efforts should be required to undergo similar analysis and control. The present work is carried out with the aim of studying the impact of individual marketing efforts (advertising, salesforce, promotion, distribution and price) on sales and overall customer satisfaction for a brand (Navratna) by taking into consideration both the financial and nonfinancial aspects of the measurement. The return-on-investment (ROI) has been calculated for each effort on the basis of sales and adjusted for the respective customer satisfaction indices (CSI). The results have been compared to get an idea about the relative effectiveness of each marketing effort on sales, CSI and ROI. The findings suggest that all the marketing efforts have significant positive impact on sales except price. Moreover, all the marketing efforts have significant positive effects on overall customer satisfaction for the brand. Furthermore, among all the marketing efforts the adjusted ROI is the highest for salesforce. These results will assist the managers in allocating the resources to different marketing efforts in a better manner, so as to improve the effectiveness of marketing expenditures.Journal of Targeting, Measurement and Analysis for Marketing (2008) 16, 181188. doi:10.1057/jt.2008.12; published online 30 June 2008 ABSTRACT FROM AUTHOR Copyright of Journal of Targeting, Measurement & Analysis for Marketing is the property of Palgrave Macmillan Ltd. and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)