Marketing Investment Essay

269 words - 2 pages

Marketing investment Chapter 1, Question 1
The 80/20 rule has a few marketing-related applications. One application relates to how money is spent on advertising and other marketing campaigns. In general, 20 percent of marketing messages produce 80 percent of your campaign results. Understanding which of your investments produce the greatest results lets you eliminate some of the costs associated with less productive ...view middle of the document...

This rule is important to marketers in two different cases. One way this is important is that a firm may want to focus marketing efforts on that 20%. Another way this is important is that since most firms are competing for that 20%, you might want to focus on targeting the other 80% of consumers.
Example of a marketing investment: relates to how money is spent on advertising & marketing campaigns. Generally, 20% of marketing messages produce 80% of campaigns results. Understanding this, marketers will be able to eliminate costs associated with less productive techniques improves marketing efficiency & returns. Product mix: 80% of company’s revenue is derived from 20% of its products or services. Marketers can emphasize the value of core products in a better way to target customers & expand business by targeting new customer groups. Profits: most useful applications of 80/20 rule in marketing relaters to profits. A company can earn 80% of its profits from the top 20% of its customer base. It helps company to focus on maintaining relationships with these top customers increases loyalty from customers will offer best value to companies.

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