Marketing control and performance in early-growth companies

This article examines the relationship between market performance and marketing control systems used by early-growth electronic component and instrument manufacturers. Essentially, “marketing control” means keeping things on track. Long pushed aside by the excitement of planning and organizing business ventures, controlling operations, particularly marketing operations, has received little attention. This is regrettable because control is the only mechanism which ensures that resources are allocated efficiently and that strategic objectives are met. Also, for the early-growth high tech company, which is already in a state of flux, developing an appropriate marketing control system is essential to its ability to meet and respond to the recurring challenges brought about by the pace at which change is occurring.In this article the author examines the issue of marketing control from a theoretical as well as an empirical perspective. First, the author presents a framework for evaluating the marketing control system within a company. The core of the framework presents the essential elements of marketing control: feedback and corrective action. Bounding the core is:

1. 1. The Formal Marketing Organization. Delimits the company's capability to enact the control processes.

2. 2. Marketing Culture. The subjective, interpretive aspect of organizational life, which determines what control components and marketing structure are valued in the company.

The framework is used to analyze the marketing control systems of 20 early-growth high tech manufacturing companies. Four hierarchical configurations of the control system elements are identified and the companies assigned to one of the following configurations:

1. I. seeking some sales.

2. II. making good on sales.

3. III. seeking profitable sales.

4. IV. making profitable sales.

Four companies possessed none of the elements of control. There were merely operations which produced results. As a consequence the companies were judged to be generally unsuccessful in focusing their resources on the markets that they wished to serve. In addition, the market performances of these firms, relative to others in the sample, were poor. Ten Stage II companies, in their attempts to expand sales and to remedy logistical problems associated with making deliveries on sales, had developed formal sales departments. Unlike the four companies which were placed in Stage III, these companies put little emphasis on the financial accountability of sales and marketing. Consequently, their abilities to evaluate or steer profit performances mitigated against their achieving high levels of market performance. Only two companies were judged sufficiently different from other companies to warrant placement in Stage IV. These companies focused on developing marketing structures and reporting procedures which provided real time feedback on market performances. Because of this, they appeared able to identify market opportunities that were defensible in the long run and in which they could exercise control over profits.In conclusion, the findings indicate that greater control of marketing operations correlates with stronger market performances. When performance is measured in terms of absolute sales, sales growth. cumulative cashflow and profitability, companies with more evolved marketing control systems perform noticeably better than do others in the sample.     

基于价值链理论的黑龙江省热力公司成本控制研究

通过以价值链理论和成本控制理论为理论指导,对供热公司的价值链进行分析发现,黑龙江省热力公司成本控制中存在的问题,主要体现在热力市场不成熟、不规范,在市场中受制于上、下游企业,煤炭资源日趋紧缺等方面。热力行业的特殊性,使得其成本控制也与一般企业有所不同。对热力公司的成本控制对策研究可以从供热设计、热水生产和热水销售等三个阶段来进行。此外,取得成本控制的实效,还必须考虑企业外部政治、经济、法律等环境以及企业和用户等因素,并综合运用各种成本控制方法和对策,从而达到控制成本的目的。     

To Launch or Not to Launch: An Empirical Estimate of New Food Product Success Rate

New product introduction is one of the most important activities for a company’s growth. It is generally accepted that new product introductions are essential to the health of food companies. Yet, many believe that most new products fail, therefore discouraging companies to introduce some new products. However, most of the estimates suggesting high failure rates are either anecdotal or qualitative. This article provides a quantitative approach to measuring new product success rates for food products and to show the relationship between the success of new product and entry strategies. This article uses a quantitative approach to measuring product success/failure exclusively for food products. The authors contend that failure rates for food products are not nearly as low, and success rates much higher than it was previously established in the literature and perceived by the industry professionals. There was a significant variability of success rates between various food groups ranging from 58% for both fruit and vegetables and desserts and ice-cream categories to 88% for baby food. Success rates also varied among the different introductory strategies of the new food products, ranging from 50% for new packaging to 75% for re-launch strategies.

Academics and practitioners usually quote very low success rates for new products based on subjective and/or strictly qualitative information. This empirical quantitative research shows that success rates for food products are much higher than previously reported. This should encourage greater use of new products to grow sales and profits. The previously reported low success rate may have led to the reluctance to introduce new products and therefore set many of the legacy food companies in their current poor financial condition.     

A study to identify the training needs of life insurance sales representatives in Taiwan using the Delphi approach

This article reports a study conducted to identify the needs for continuing professional development for life insurance sales representatives and to examine the competencies needed by those sales representatives. A modified Delphi technique was used. Most life insurance companies in the USA implement an education and training plan advocated by the Life Office Management Association. Insurance companies in Taiwan implement similar education and training plans, but they do not seem to result in the successful performance of their sales representatives. Besides augmenting knowledge of various financial products and marketing approaches, this study also suggests that life insurance companies need to train their sales representatives to an adequate standard in competencies of problem solving, communication, information technology utilization, culture compatibility, emotional intelligence, collective competence and ethics.     

Supervising Unethical Sales Force Behavior: How Strong is the Tendency to Treat Top Sales Performers Leniently?

Findings from prior research show that there is a general tendency to discipline top sales performers more leniently than poor sales performers for engaging in identical forms of unethical selling behavior. In this study, the authors attempt to uncover moderating factors that could override this general tendency and bring about more equal discipline for top sales performers and poor sales performers. Surprisingly, none were found. A company policy stating that the behavior in question was unacceptable nor a repeated pattern of unethical behavior offset the general tendency to treat top sales performers more leniently than poor sales performers. In an attempt to dig deeper to find a significant moderating effect, two follow-up experiments were conducted. In the first follow-up experiment, a specific training program designed to communicate top management's desire to treat ethical matters equally based on the severity of the act had no effect on equalizing the discipline between top sales performers and poor sales performers. In the second follow-up experiment, a stronger company policy that specified a prescribed level of punishment also failed to equalize the discipline. A superior sales performance record appears to induce more lenient forms of discipline, despite the presence of other factors and managerial actions that are specifically instituted to produce more equal forms of discipline. The answer to the question posed in the article title is, "apparently very strong!"     

Sales promotion practices of consumer goods companies in an advanced developing country

In recent years, manufacturers of consumer and industrial goods as well as service firms have been increasingly thinking in global terms and paying more attention to sales promotion in their overall promotional programmes and strategies. The purpose of this paper is to investigate the consumer sales promotion practices of consumer goods producing companies in the advanced developing country of Turkey. It was discovered that sales promotion activities are gaining importance in overall promotional practices of Turkish companies, though there are differences in its use by type of industry, size of company, area of business and locus of decision-making within the firm. Furthermore, differences were detected between companies using sales promotions versus other forms of promotional techniques such as mass media advertising, personal selling and publicity. Study findings may be applicable to other developing countries that are at a similar level of socio-economic, market and technological development as Turkey.     

Important issues for a growing timeshare industry

Timeshares—which involve the purchase of the use of resort accommodations for an interval of time—have become a relatively common way for people to vacation. Even so, the industry still has achieved just a 3-percent penetration of U.S. households with incomes over $50,000. A survey of 127 timeshare executives in the United States found that the industry's greatest challenges come from issues involving marketing and the industry's image (e.g., many potential clients still remember the high-pressure tactics that brought the industry into question 20 to 30 years ago). Timeshare developers have formed a trade association to address some of those image issues, but not all companies subscribe to that group. Other marketing issues include the overall cost of sales and marketing—in particular, the cost of developing leads. The process of finding customers is complicated by the fact that the individual states regulate timeshare sales, and a company must be registered in a state to offer timeshares to residents of that state. This matter impedes the use of the internet for timeshare sales. A final important issue is human resources: finding, retaining, and training employees and managers is difficult for timeshare companies (as it is for hotels), partly because they operate in resort areas where labor resources generally are already spread thin.     

Why do boycotts sometimes increase sales? Consumer activism in the age of political polarization

In this article, we argue that the occurrence, trajectory, and impact of consumer activism are in large part driven by the political environment in which firms operate, particularly by their country’s level of polarization and the political makeup of their core customer base. In environments characterized by low levels of political polarization, companies are embroiled in a relatively small number of political controversies, and as a result are rarely the target of consumer activism. Conversely, in highly polarized environments, people’s political sensibilities are easily offended, which leads to a relatively large number of political controversies. These controversies tend to arise along party lines, meaning they elicit a consumer boycott exclusively from one side of the political spectrum. Such partisan boycotts lead people on the other side of the political spectrum to rally around the company at the center of the controversy and to purchase more of its products. Whether a company’s sales end up decreasing or increasing depends on the nature of the issue at the heart of the controversy as well as on the political beliefs of its core customer base. We conclude by describing how companies can successfully navigate this complex interplay between political polarization, consumer activism, and customers’ political preferences.     

The interplay of social influence and nature of fulfillment: Effects on consumer attitudes

Sales promotional activities account for a significant portion of the integrated marketing communications budget of most companies because brand managers realize the effectiveness of these activities in meeting certain marketing communication objectives. However, there are times when promotional plans backfire, and promotions go unfulfilled. Much of this is reported in the media, and these reports are likely to trigger discussions about the companies involved in the nonfulfillment. Although much research has focused on the impact of sales promotional activities on consumers' responses and attitudes, not much has focused on how nonfulfillment of promotional promises and social influence might operate to color consumers' perceptions of a company. This article reports on an experimental study that was conducted to investigate this issue. Results indicate significant effects of the nature of fulfillment on corporate credibility, brand attitude, and patronage intentions; significant social influence effects on brand attitude, patronage, and switching intentions; and an interaction effect of social influence and fulfillment on switching intentions. The implications for brand managers and marketing communications managers are discussed, and areas for future research are proposed. © 2004 Wiley Periodicals, Inc.     

Ethics Codes and Sales Professionals' Perceptions of Their Organizations' Ethical Values

Most large companies and many smaller ones have adopted ethics codes, but the evidence is mixed as to whether they have a positive impact on the behavior of employees. We suggest that one way that ethics codes could contribute to ethical behavior is by influencing the perceptions that employees have about the ethical values of organizations. We examine whether a group of sales professionals in organizations with ethics codes perceive that their organizational context is more supportive of ethical behavior than sales professionals in companies without codes. After accounting for the effect of several covariates, our results indicated that sales professionals employed in organizations with codes of ethics perceived their work environments to have more positive ethical values than did other sales professionals.     

Corporate taxes and the demand for labor and capital in developing countries

This article provides evidence about the impact of corporate taxation on both labor and capital demand by private companies in a developing economy, using firm level data from Chile. Our results show that higher corporate tax rates reduce not only the demand for capital, but also the demand for labor due to complementarities between both inputs. An interesting element of the results presented in this article is the asymmetry between the effects of taxation according to company size. The impact on labor demand is significantly higher in large corporations than in small enterprises, while the demand for capital is more responsive to corporate tax changes in small firms. We can explain these results based on differences in credit constraints according to firm size.     

Does the Market for Top Executives Work? CEO Pay and Turnover in Small U.K. Companies

This paper presents the results of our investigation into the operation of the managerial labour market in small and medium sized manufacturing companies. Using a sample of some 40 or so companies we study the sensitivity of managerial pay and tenure to company performance. Managerial pay in this type of firms is much lower than the six digit figures quoted for large public companies and CEO turnover is much higher than we expected. We find some evidence to suggest that pay in small companies is sensitive to sales growth and that CEO tenure in public companies responds to the growth in sales.     

Are Brand Promotions Just a Zero-Sum Game – or Can They Increase the Size of the Pie?

Packaged goods companies now "spend" more on promotions – special offers, in-store displays and the like – than on media advertising. Until recently, it was generally believed that while promotions benefit individual brands, they usually do not result in an increase in overall category sales. Recent research, however, suggests that promotions can increase total category sales in a wide range of circumstances. This article starts by discussing the relationship between brand promotion and category sales, outlines research to date, and then describes the author's own most recent research on this topic. It concludes by pointing to implications for managers.     

Insurance Sales Agents and the Internet: The Relationship Between Opinion Leadership,Subjective Knowledge,and Internet Attitudes

The Internet offers a number of opportunities and threats for insurance sales agents. On the one hand, the Internet provides opportunities to communicate with and reach customers. However, it also introduces the risk of losing business to insurance providers or competitors. These opportunities and threats create a need to understand the characteristics that may affect the views of insurance agents regarding the Internet and its impact on their business. This paper compares insurance sales agents' scores on an opinion leadership scale (Flynn, Goldsmith, and Eastman 1996) and subjective knowledge scale (Flynn and Goldsmith 1999) with their attitudes toward the Internet. The results suggest that those insurance sales agents with a higher level of subjective knowledge about the Internet are more likely to be opinion leaders about the Internet. Both opinion leaders and those with higher levels of subjective knowledge have a more positive attitude about the Internet, but only the relationship with opinion leadership is significant. In addition, those insurance sales agents who are younger (than the approximate mean age of 46 years old) are more likely to be opinion leaders and have a higher level of subjective knowledge of the Internet. The results suggest that perceived knowledge and the willingness to discuss the Internet with others impact one's attitude of it, and that the younger insurance agents will play a leading role in how the Internet will be used.     

外部审计、债务期限结构选择与审计治理效应

外部审计通过鉴证可以降低委托人与代理人之间的信息不对称,能够在一定程度上缓解各方的代理冲突,是公司治理机制的重要组成部分。以2007—2010年中国上市的A股非金融类公司为样本,实证研究外部审计对上市公司债务期限结构选择的影响,结果表明:外部审计对上市公司债务期限结构选择产生了显著影响,当上市公司被出具无保留意见时,更容易得到长期债务;被四大事务所审计的上市公司,更容易获得长期债务;中国的外部审计发挥了应有的公司治理职能,保护了债权人的利益。     

Cross-functional selling teams - The loss of control of the selling function

Selling has become dispersed through the use of selling teams that include members from functional areas other than marketing or sales. This now occurs within many firms utilising key account management strategies, within both business-to-business and business-to-reseller environments. This article is aimed at developing a better understanding of factors affecting ‘team selling’ and its impact on sales performance, with clear benefits to company management.     

University revenues from technology transfer: Licensing fees vs. equity positions

This paper analyzes the financial return of universities' taking equity in their spin-off companies, and the prevailing attitudes toward taking equity. The reasons for taking equity include: the flexibility it gives licensing managers in structuring deals, the possibility that the university will still hold something of value if their technology is replaced, and, the reduced time required to generate revenue compared to a traditional license. A traditional license is preferred when the technology is not suitable for a spin-off company, or when the technology is one of the rare jackpot licenses that bring in millions of dollars every year.The financial reward of taking equity was determined by comparing the value of equity sold in public spin-off companies to the return on an average license. A traditional license consists of a license issue fee between $10,000 and $250,000 and an annual royalty on sales. In 1996 the average annual income from a traditional license was $63,832. The average value of equity sold in 16 university spin-off companies is $1,384,242. If one assumes that half the spin-offs fail before they go public, the average value of equity is $692,121. This is more than 10 times the average annual income from a traditional license, and is significantly higher than the amount usually received as a license issue fee.The high average value of equity depends on the presence of a few million-dollar equity sales. If those sales are excluded, the average value of equity is $139,722, which is within the range that can be received as a license issue fee. There is a high correlation between million-dollar equity sales and the amount of venture capital spending in the region. The million-dollar sales in this study all occurred in the top 11 states in the country in terms of venture capital spending in 1997.From a financial viewpoint it makes sense for licensing managers to take equity in their start-up companies. Our data show that even if none of the start-ups produces a million-dollar equity sale, the financial return of equity will be within the range normally received as a license issue fee. Taking equity leaves the door open for the occasional jackpot, which will bring in significantly more money than a standard license. When combined with a strong program of traditional licensing, taking equity in start-up companies maximizes the financial return that universities realize from their intellectual property.     

Reviewing the reviewers: The impact of individual film critics on box office performance

Critics and their opinions or critical reviews play a major role in many markets. Marketing research on how critics impact product performance has so far examined an aggregate critic effect. An obstacle in studies examining the relationship of aggregate critical opinion and product sales is the close association between the intrinsic quality of a product and the aggregate opinion regarding the product. Our analysis parses out these two effects, allowing us to distinguish individual critics who are simply good at identifying products with popular appeal from those who act as opinion leaders and engender early product sales. The role of critics is especially prominent in the film business, in which one finds multiple expert opinions about each movie and where critics’ endorsements are used in advertising. In the context of the motion picture industry, our research investigates the impact of individual film critics on the market performance of movies, where specific key critics and reviewers may serve as market gatekeepers, and where various critics may have different types of impacts on product performance.

基于多元化战略的集团公司销售协同探讨

本文认为,多元化战略是很多大型集团公司采用的经营方式,也是实现协同效应的重要方式,同时协同效应是实施多元化战略的重要动因。销售协同的关联存在于销售活动价值链的各个环节,且相关多元化公司更容易找到这种关联。不同协同方式各有特点及适用条件,公司应考虑其产品类型、经营区域、目标客户及公司战略等因素来选择恰当的方式。文章提出,在实现销售协同的过程中应注意以下问题:不同协同方式如品牌延伸、人员共享与跨部门使用、销售基础设施共享、共享物流、建立销售子公司等有各自的优劣势和适用条件。在实施销售协同过程中应该注意由高层推动与设定共同战略目标,创造良好的环境氛围,选择恰当的协同方式,建立有效的评价激励制度等方面的问题。     

Goal-Setting Process and Typologies

The corporate goal-setting process is examined to determine the extent of causal interrelationships among five widely used performance targets: market share, ROI profit, corporate image, and sales volume. By making use of the professional services sector as a testing ground, different company typologies were developed on the basis of regression coefficients which determined the causal associations among corporate objectives. Some of the findings revealed that sales volume and corporate image influenced market share. The direct impact of corporate impact of the sales volume and market share on ROI is also found, as well as the impact of the sales volume obiective on the pursuit of overall profitability. It is suggested that each corporate objective serves a special purpose and that managers should incorporate the most suitable performance measures into their strategic plans.