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Navigating Marketing and Finance: Creating Value and Growth in Business

This insightful guide delves into the core dynamic of marketing and finance in business. It explores the objectives of stakeholders, CEOs, and the intertwining factors influencing budget justification. Learn about customer equity, financial reporting, marketing strategies, and the impact of product pre-announcements. Discover how to enhance customer perceptions, boost profitability, and drive market growth by aligning marketing and financial actions effectively.

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Navigating Marketing and Finance: Creating Value and Growth in Business

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Presentation Transcript

  1. Marketing & Finance Who is in charge?

  2. The Objective of Business • What do stakeholders want? • Increased value of holdings • How do they get it? • What do CEOs want? • Acclaim • Financial rewards • Salary, bonuses, stock options • How do they get it?

  3. Tangential Issues • Ethics • Culture

  4. Justification of Budget • R&D? • Finance? • Manufacturing? • Management? • Marketing? • How does the ‘softer side of business’ get a seat at the table?

  5. Marketing and Finance • Marketing Actions • Customer Perceptions • Customer Service • Promotions • Pricing • Loyalty Programs • Product • Channels • Perceived Value • Trust • Satisfaction • Loyalty • Commitment

  6. Marketing and Finance • Customer Behaviors • Financial Outcomes • First purchase (customer acquisition) • Repeat purchase (customer retention) • Cross-selling • Departure • Customer Equity • Profitability • Share value • Firm value

  7. Financial Reporting • Financial statement objectives • To help investors assess the amounts, timing, and uncertainty of prospective cash receipts. (Financial Accounting Standards Board) • “Firms must report additional information that explains the main trends and factors that underlie their development, performance and position.” (International Accounting Standards Board, 2005)

  8. Customer Equity • Important for firms for whom customers are their major asset. • Cable companies • Subscription services • Phone companies • Netflix

  9. Marketing Strategies and Customer Volume • Attract new customers to grow market share • Grow the market demand by bringing more customers into a market • Enter new markets to create new sources of customer volume

  10. Marketing Strategies and Margin • Grow revenue per customer by product line extensions • Grow revenue per customer by adding services that enhance customer value • Improve margin per customer with improved products and services for which the customer is willing to pay a premium price

  11. Marketing Strategies and Margin • Develop more cost-efficient marketing systems that lower variable sales and transaction costs • Eliminate customers that are not able to produce an acceptable level of customer margin

  12. Product Pre-announcements • Impact on: Pros Cons • Customers • Competitors • Channel members Investors

  13. Product Pre-announcements: abnormal returns Preannouncement Updating LOW HIGH Preannouncement Reliability LOW7.86%20.9% HIGH 9.37% 34.9% Delayed launches decrease market value of firm 5.25%

  14. Introduced April, 1981 dual 91k drives (floppy) Price $1,795 Sept. 1981, sales exceed $1 million for Weight 24.5 the month Ram 64k

  15. 1982 Osborne announces the Executive and the Vixen Sept. 1983 Osborne files for Chapter 11

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