Basic Marketing: A Global Managerial Approach

Perreault−McCarthy: Basic

Marketing: A

Global−Managerial

Approach, 14/e

19. Implementing and
    Controlling Marketing
    Plans: Evolution and
    Revolution

Text © The McGraw−Hill

Companies, 2002

560 Chapter 19

60 percent, and sales analysis showed that 70 percent of the sales were at conve-

nience stores. A few years later, however, sales analysis showed that sales were slowly

trending down. Rather than wait for a painful death of the product, they replaced

it with a new item.^8

As the Ben & Jerry’s example shows, it ispossible for marketing managers to get

detailed information about how marketing plans are working—but only if they ask

for and help develop the necessary data. In this section, we’ll discuss the kinds of

information that can be available and how to use it. The techniques are not really

complicated. They basically require only simple arithmetic—and of course com-

puters quickly and easily take care of that when a large volume of sorting, adding,

and subtracting is required.

Sales Analysis Shows What’s Happening

But a marketing
manager must ask for it

What to ask for varies

Sales analysis—a detailed breakdown of a company’s sales records—can be very

informative. Detailed data can keep marketing executives in touch with what’s

happening in the market. In addition, routine sales analyses prepared each week

or month may show trends and allow managers to check their hypotheses and

assumptions.^9

Some managers resist sales analysis, or any analysis for that matter, because they

don’t appreciate how valuable it can be. One top executive in a large firm made no

attempt to analyze company sales, even by geographic area. When asked why, the

executive replied: “Why should we? We’re making money!”

But today’s profit is no guarantee that you’ll make money tomorrow. In fact,

ignoring sales analysis can lead not only to poor sales forecasting but to poor deci-

sions in general. One manufacturer did much national advertising on the assumption

that the firm was selling all over the country. But a simple sales analysis showed

that most present customers were located within a 250-mile radius of the factory!

In other words, the firm didn’t know who and where its customers were—and it

wasted most of the money it spent on national advertising.

Detailed sales analysis is only possible if a manager asks for the data. Valuable

sales information is often buried—perhaps on sales invoices or in billing records on

an accountant’s computer.

Today, with computer networks and organized marketing information systems,

effective sales analysis can be done easily and at relatively small cost—if mar-

keting managers decide they want it done. In fact, the desired information can

be obtained as a by-product of basic billing and accounts receivable procedures.

The manager simply must make sure the company captures identifying informa-

tion on important dimensions such as territory, sales reps, product model,

customer, and so forth. Then computers can easily run sales analyses and simple

trend projections.

There is no one best way to analyze sales data. Several breakdowns may be

useful—depending on the nature of the company and product and what dimensions

are relevant. Typical breakdowns include:

1. Geographic region—country, state, county, city, sales rep’s territory.


2. Product, package size, grade, or color.


3. Customer size.


4. Customer type or class of trade.