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    Marketing Margin Revenue - Costs

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    sunny vaswani
    The document lists both direct and indirect costs that are typically incurred from sales promotions. Direct costs include costs of goods sold, promotional allowances, distribution costs, marketing materials, and product placement. Indirect costs include cannibalization, conceptualization of the promotion, promoting the promotion, discounts, consumer switching costs, forward buying costs, and post-promotion slump.

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    Marketing Margin Revenue - Costs

    Uploaded by

    sunny vaswani
    18 views2 pages
    The document lists both direct and indirect costs that are typically incurred from sales promotions. Direct costs include costs of goods sold, promotional allowances, distribution costs, marketing materials, and product placement. Indirect costs include cannibalization, conceptualization of the promotion, promoting the promotion, discounts, consumer switching costs, forward buying costs, and post-promotion slump.

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    giant consumer products

    Original Title

    Q2

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    The document lists both direct and indirect costs that are typically incurred from sales promotions. Direct costs include costs of goods sold, promotional allowances, distribution costs, marketing materials, and product placement. Indirect costs include cannibalization, conceptualization of the promotion, promoting the promotion, discounts, consumer switching costs, forward buying costs, and post-promotion slump.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pptx, pdf, or txt
    18 views2 pages

    Marketing Margin Revenue - Costs

    Uploaded by

    sunny vaswani
    The document lists both direct and indirect costs that are typically incurred from sales promotions. Direct costs include costs of goods sold, promotional allowances, distribution costs, marketing materials, and product placement. Indirect costs include cannibalization, conceptualization of the promotion, promoting the promotion, discounts, consumer switching costs, forward buying costs, and post-promotion slump.

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    of 2

    Q2.

    Improve upon Exhibit 2 in the case and draw up an


    exhaustive list of typical costs incurred in a sales
    promotion.
    Marketing Margin = Revenue - Costs

    Incremental Direct Expenses


    Volume generated 1. COGS
    by sales promotion 2. Promotional Allowance
    X 3. Distribution
    Price to Retailer 4. Cost of marketing material
    5. Cost of product placement
    Indirect Expenses
    1. Cannibalization
    2. Cost of conceptualization of
    promotion
    3. Cost of promoting the
    promotion
    4. Differential cost due to
    discounts
    5. Consumer switching costs
    6. Forward buying costs
    7. Post promotion slump
    1.How was GCP handling the
    marketing of the three product lines?
    What were their motivations behind
    their strategies? Critically discuss
    GCPs approach.
    2.Improve upon Exhibit 2 in the case
    and draw up an exhaustive list of
    typical costs incurred in a sales
    promotion.
    3.Was Capps right in raising his
    concerns regarding trade promotions
    (cannibalization, brand equity
    erosion, forward-buying, pass-
    through, and consumer stockpiling)?
    How much should this effect the
    promotional decisions for GCPs
    products?
    4.Do you advise Sanchez to run a
    national sales promotion? If so, to
    which one of the items should the
    funds be allocated: (a)Dinardos32-
    ounce packages, (b)Dinardos16-
    ounce packages, or (c)Natural Meals?

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