Company A has profits of more than $50 billion on sales of $182 billion and Company M has profits of $30 billion on sales of $88 billion. Characters in case: Company P and Company V Introduction: Net profit margin is the amount left after the deduction of all expenses, interest, and preferred stock dividend. Net marketing contribution is calculated to determine whether the marketing strategy is available to cover the cost which is associated with the company’s sales and marketing. Return on marketing investment refers to the overall performance of the campaign of the market. Market return on sales is determined to calculate the difference between the two companies. Adequate information: Particulars Company P Company V Sales $125,897,000 $87,421,000 Gross profit $50,439,000 $20,899,000 Marketing expenses $4,333,750 $13,474,000 Net income $42,305,000 $17,957,000 Selling & administrative expenses $6,127,000 $4,564,000 General expenses $2,641,320 $3,854,600

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Answer 1

Question

Chapter 2, Problem 2.14MA

Summary Introduction

Case summary:

Company A has profits of more than $50 billion on sales of $182 billion and Company M has profits of $30 billion on sales of $88 billion.

Characters in case:

Company P and Company V

Introduction:

Net profit margin is the amount left after the deduction of all expenses, interest, and preferred stock dividend.

Net marketing contribution is calculated to determine whether the marketing strategy is available to cover the cost which is associated with the company’s sales and marketing.

Return on marketing investment refers to the overall performance of the campaign of the market.

Market return on sales is determined to calculate the difference between the two companies.

Adequate information:

Particulars Company P Company V

Sales $125,897,000 $87,421,000

Gross profit $50,439,000 $20,899,000

Marketing expenses $4,333,750 $13,474,000

Net income $42,305,000 $17,957,000

Selling & administrative expenses $6,127,000 $4,564,000

General expenses $2,641,320 $3,854,600

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You’ve probably heard of Nutrisystem, a company that produced $800 million in revenues last year by selling weight-loss products. What started as a small effort based on an e-commerce marketing plan has evolved into a multipronged marketing campaign that not only has expanded the business but also provides substantial return-on-investment potential. The key to Nutrisystem’s efforts is its direct-to-consumer platform. Using various advertising outlets, from magazines to television, Nutrisystem’s promotions all have one thing in common—they let customers make direct contact with the company. Inserting a unique URL or 800 number in every ad also lets Nutrisystem track the success of each and every effort. In addition to its direct-to-consumer distribution and promotional efforts, what is essential to the success of Nutrisystem?

You’ve probably heard of Nutrisystem, a company that produced $800 million in revenues last year by selling weight-loss products. What started as a small effort based on an e-commerce marketing plan has evolved into a multipronged marketing campaign that not only has expanded the business but also provides substantial return-on-investment potential. The key to Nutrisystem’s efforts is its direct-to-consumer platform. Using various advertising outlets, from magazines to television, Nutrisystem’s promotions all have one thing in common—they let customers make direct contact with the company. Inserting a unique URL or 800 number in every ad also lets Nutrisystem track the success of each and every effort. In what different ways does Nutrisystem engage in direct marketing?

You’ve probably heard of Nutrisystem, a company that produced $800 million in revenues last year by selling weight-loss products. What started as a small effort based on an e-commerce marketing plan has evolved into a multipronged marketing campaign that not only has expanded the business but also provides substantial return-on-investment potential. The key to Nutrisystem’s efforts is its direct-to-consumer platform. Using various advertising outlets, from magazines to television, Nutrisystem’s promotions all have one thing in common—they let customers make direct contact with the company. Inserting a unique URL or 800 number in every ad also lets Nutrisystem track the success of each and every effort. What advantages does Nutrisystem’s marketing campaign have over selling through intermediary channels?

Answer 2

Question

Chapter 2, Problem 2.14MA

Summary Introduction

Case summary:

Company A has profits of more than $50 billion on sales of $182 billion and Company M has profits of $30 billion on sales of $88 billion.

Characters in case:

Company P and Company V

Introduction:

Net profit margin is the amount left after the deduction of all expenses, interest, and preferred stock dividend.

Net marketing contribution is calculated to determine whether the marketing strategy is available to cover the cost which is associated with the company’s sales and marketing.

Return on marketing investment refers to the overall performance of the campaign of the market.

Market return on sales is determined to calculate the difference between the two companies.

Adequate information:

Particulars Company P Company V

Sales $125,897,000 $87,421,000

Gross profit $50,439,000 $20,899,000

Marketing expenses $4,333,750 $13,474,000

Net income $42,305,000 $17,957,000

Selling & administrative expenses $6,127,000 $4,564,000

General expenses $2,641,320 $3,854,600

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Answer 3

Question

Chapter 2, Problem 2.14MA

Summary Introduction

Case summary:

Company A has profits of more than $50 billion on sales of $182 billion and Company M has profits of $30 billion on sales of $88 billion.

Characters in case:

Company P and Company V

Introduction:

Net profit margin is the amount left after the deduction of all expenses, interest, and preferred stock dividend.

Net marketing contribution is calculated to determine whether the marketing strategy is available to cover the cost which is associated with the company’s sales and marketing.

Return on marketing investment refers to the overall performance of the campaign of the market.

Market return on sales is determined to calculate the difference between the two companies.

Adequate information:

Particulars Company P Company V

Sales $125,897,000 $87,421,000

Gross profit $50,439,000 $20,899,000

Marketing expenses $4,333,750 $13,474,000

Net income $42,305,000 $17,957,000

Selling & administrative expenses $6,127,000 $4,564,000

General expenses $2,641,320 $3,854,600

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Answer 4

Question

Chapter 2, Problem 2.14MA

Summary Introduction

Case summary:

Company A has profits of more than $50 billion on sales of $182 billion and Company M has profits of $30 billion on sales of $88 billion.

Characters in case:

Company P and Company V

Introduction:

Net profit margin is the amount left after the deduction of all expenses, interest, and preferred stock dividend.

Net marketing contribution is calculated to determine whether the marketing strategy is available to cover the cost which is associated with the company’s sales and marketing.

Return on marketing investment refers to the overall performance of the campaign of the market.

Market return on sales is determined to calculate the difference between the two companies.

Adequate information:

Particulars Company P Company V

Sales $125,897,000 $87,421,000

Gross profit $50,439,000 $20,899,000

Marketing expenses $4,333,750 $13,474,000

Net income $42,305,000 $17,957,000

Selling & administrative expenses $6,127,000 $4,564,000

General expenses $2,641,320 $3,854,600

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Answer 5

Chapter 2, Problem 2.14MA

Summary Introduction

Case summary:

Company A has profits of more than $50 billion on sales of $182 billion and Company M has profits of $30 billion on sales of $88 billion.

Characters in case:

Company P and Company V

Introduction:

Net profit margin is the amount left after the deduction of all expenses, interest, and preferred stock dividend.

Net marketing contribution is calculated to determine whether the marketing strategy is available to cover the cost which is associated with the company’s sales and marketing.

Return on marketing investment refers to the overall performance of the campaign of the market.

Market return on sales is determined to calculate the difference between the two companies.

Adequate information:

Particulars Company P Company V

Sales $125,897,000 $87,421,000

Gross profit $50,439,000 $20,899,000

Marketing expenses $4,333,750 $13,474,000

Net income $42,305,000 $17,957,000

Selling & administrative expenses $6,127,000 $4,564,000

General expenses $2,641,320 $3,854,600

Answer 6

Chapter 2, Problem 2.14MA

Summary Introduction

Case summary:

Company A has profits of more than $50 billion on sales of $182 billion and Company M has profits of $30 billion on sales of $88 billion.

Characters in case:

Company P and Company V

Introduction:

Net profit margin is the amount left after the deduction of all expenses, interest, and preferred stock dividend.

Net marketing contribution is calculated to determine whether the marketing strategy is available to cover the cost which is associated with the company’s sales and marketing.

Return on marketing investment refers to the overall performance of the campaign of the market.

Market return on sales is determined to calculate the difference between the two companies.

Adequate information:

Particulars Company P Company V

Sales $125,897,000 $87,421,000

Gross profit $50,439,000 $20,899,000

Marketing expenses $4,333,750 $13,474,000

Net income $42,305,000 $17,957,000

Selling & administrative expenses $6,127,000 $4,564,000

General expenses $2,641,320 $3,854,600

Answer 7

Chapter 2, Problem 2.14MA

Summary Introduction

Case summary:

Company A has profits of more than $50 billion on sales of $182 billion and Company M has profits of $30 billion on sales of $88 billion.

Characters in case:

Company P and Company V

Introduction:

Net profit margin is the amount left after the deduction of all expenses, interest, and preferred stock dividend.

Net marketing contribution is calculated to determine whether the marketing strategy is available to cover the cost which is associated with the company’s sales and marketing.

Return on marketing investment refers to the overall performance of the campaign of the market.

Market return on sales is determined to calculate the difference between the two companies.

Adequate information:

Particulars Company P Company V

Sales $125,897,000 $87,421,000

Gross profit $50,439,000 $20,899,000

Marketing expenses $4,333,750 $13,474,000

Net income $42,305,000 $17,957,000

Selling & administrative expenses $6,127,000 $4,564,000

General expenses $2,641,320 $3,854,600

Answer 8

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Answer 9

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Answer 10

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Answer 11

Ch. 2 - Prob. 1ALC Ch. 2 - Prob. 1BLC Ch. 2 - Prob. 1CLC Ch. 2 - Prob. 2.1DQ Ch. 2 - Prob. 2.2DQ Ch. 2 - Prob. 2.3DQ Ch. 2 - Prob. 2.4DQ Ch. 2 - Prob. 2.5DQ Ch. 2 - Prob. 2.6CTE Ch. 2 - The Boston Consulting Group (BCG) Matrix is a...

Solution Summary: The author explains the formula to calculate the net profit margin for Company P and Company V.

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Chapter 2 Solutions

Particulars	Company P	Company V
Sales	$125,897,000	$87,421,000
Gross profit	$50,439,000	$20,899,000
Marketing expenses	$4,333,750	$13,474,000
Net income	$42,305,000	$17,957,000
Selling & administrative expenses	$6,127,000	$4,564,000
General expenses	$2,641,320	$3,854,600