Verhoef and Leeflang (2009) assert the idea of financial metrics and state that influence of marketing department in the organisation is positively associated with the financial performance of the firm.
Importance and role of the financial metrics for the effectiveness of the marketing campaign can be clearly assessed from the B&K Distributors. The company integrated marketing and communication tool for building its access to the potential customers. The use of the financial measures revealed clear future potential. For example, the growth potential was estimated to increase at 6% as compared to the inflation rate of 3%. Similarly, increased fixed cost for the IT system integration was also justified with 1% as compared to the 3% of the other channels investment (Jeffery and Anfield, 2006). Hence, in the similar format the cost of the entire project is assessed against the revenue and cost savings. This empirical evidence provides sound basis for the decision making in alignment with the main objective of the business which revolves around profitability. However, the net and actual increase in return is not defined after discounting the investment against factors such as the cost of capital which is 12% and has considerable impact on the return inflows. This makes the investment and the claimed benefits questionable.
Also the marketing activities with long term objective are also required to reflect on other parameters such as increase in customer loyalty and image of the company etc. It is important to notice the measure to enhance the image of the company by signing contract with leading fast food chain did not fetch to B&K significant business from independent franchisees. The new plan of IT integration and respective financial metrics and growth projections are again silent on impact on above mentioned parameters. In no contradiction to this fact ...Show more