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Suppose that you are a marketing manager of a local bakery “Freshhh” from North Vancouver. The company is planning to analyze its profitability and to improve its overall marketing. Answer the following questions (answer all questions, make sure to number your responses – 1,2, and 3). Each question is worth up to 8 marks.
1) The company’s recent investment in a marketing campaign on the radio was $45,000. This resulted in a gain (sales growth) of $62,000. Calculate the company’s Marketing ROI for this marketing initiative. Which formula did you use for the calculation?
2) The company’s total fixed costs are $40,000. The price of each bread that they make is $3.00 and the cost to make each product is $0.80. Calculate the company’s break-even point. Which formula did you use for the calculation?
3) Assume that you want to improve the company’s market share by using direct marketing channels (a) and vertical marketing systems (b). Describe briefly how the company can use these two distribution strategies? Provide examples for each.