Mini-Case Where Should We Place Our Ad? A software company that is fairly well regarded for two large product lines has TurboTax in its sights. They’ve developed a tax package that they think their current customers will like, and they think this software will give them a chance to bring new customers to their other products. The company has developed an informative, yet succinct, and even somewhat humorous ad. One of the top managers is saying the company ought to ship out the ad in brochure form, along with a DVD with a demo file on it, as a form of direct mail. A new manager is thinking that sounds retro but doesn’t say that; instead, the manager argues that because the product is high-tech, they should reach out to customers through an email campaign. The email content would contain several embedded links to online demos on the website. The boss is indifferent (doesn’t know much about marketing, history, biology, or what a slide rule is for), but they care about costs. So a third manager called up some media providers and compiled the following price estimates. Questions: -What do we learn from the cost assessment manager? -Which of the first two managers’ directions (direct mail or email) would you support? -What is the strategy? If the company wants to emphasize customer acquisition, what would you recommend? If the company wants to emphasize customer retention, what would you recommend? -What else would you like to know for a more thorough assessment?

Principles Of Marketing
17th Edition
ISBN:9780134492513
Author:Kotler, Philip, Armstrong, Gary (gary M.)
Publisher:Kotler, Philip, Armstrong, Gary (gary M.)
Chapter1: Marketing: Creating Customer Value And Engagement
Section: Chapter Questions
Problem 1.1DQ
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Mini-Case Where Should We Place Our Ad? A software company that is fairly well regarded for two large product lines has TurboTax in its sights. They’ve developed a tax package that they think their current customers will like, and they think this software will give them a chance to bring new customers to their other products. The company has developed an informative, yet succinct, and even somewhat humorous ad. One of the top managers is saying the company ought to ship out the ad in brochure form, along with a DVD with a demo file on it, as a form of direct mail. A new manager is thinking that sounds retro but doesn’t say that; instead, the manager argues that because the product is high-tech, they should reach out to customers through an email campaign. The email content would contain several embedded links to online demos on the website. The boss is indifferent (doesn’t know much about marketing, history, biology, or what a slide rule is for), but they care about costs. So a third manager called up some media providers and compiled the following price estimates. Questions: -What do we learn from the cost assessment manager? -Which of the first two managers’ directions (direct mail or email) would you support? -What is the strategy? If the company wants to emphasize customer acquisition, what would you recommend? If the company wants to emphasize customer retention, what would you recommend? -What else would you like to know for a more thorough assessment?
AA
Th M HU University... C Ice Cream...
»
CENGAGE MINDTAP
Enlarged View
Direct mail (list
rental)
$1750
2%
20
$2,000
$250
ng.cengage.com
C Ice Cream...
Email (list rental)
$500
10%
3%
30
$3,000
$2.500
O Checkout...
Search this course
Direct mail (in
CRM system)
$750
4%
40
oscar may...
$4,000
$3,250
x MindTap -...
Email (list in CRM
system)
$250
20%
5%
50
$5,000
$4,750
ıl.
?
A-Z
Transcribed Image Text:AA Th M HU University... C Ice Cream... » CENGAGE MINDTAP Enlarged View Direct mail (list rental) $1750 2% 20 $2,000 $250 ng.cengage.com C Ice Cream... Email (list rental) $500 10% 3% 30 $3,000 $2.500 O Checkout... Search this course Direct mail (in CRM system) $750 4% 40 oscar may... $4,000 $3,250 x MindTap -... Email (list in CRM system) $250 20% 5% 50 $5,000 $4,750 ıl. ? A-Z
Th M HU University... C Ice Cream...
»
AA
2
CENGAGE MINDTAP
Enlarged View
ng.cengage.com
C Ice Cream...
Cost per 1000 (CPM)
Click-thru rate
Rate of purchase
For every 1000 reached, yield:
Say software price is $100, income:
Net income (sale - cost)
O Checkout...
Direct mail (list
rental)
$1750
2%
20
$2,000
$250
oscar may...
Search this course
Email (list rental)
$500
10%
3%
30
$3,000
$2,500
x MindTap -...
Direc
CRM
?
A-Z
Transcribed Image Text:Th M HU University... C Ice Cream... » AA 2 CENGAGE MINDTAP Enlarged View ng.cengage.com C Ice Cream... Cost per 1000 (CPM) Click-thru rate Rate of purchase For every 1000 reached, yield: Say software price is $100, income: Net income (sale - cost) O Checkout... Direct mail (list rental) $1750 2% 20 $2,000 $250 oscar may... Search this course Email (list rental) $500 10% 3% 30 $3,000 $2,500 x MindTap -... Direc CRM ? A-Z
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