(Solution Download) 1 Calculate profit margin net marketing contribution marketing return on


1. Calculate profit margin, net marketing contribution, marketing return on sales (or marketing ROS), and marketing return on investment (or marketing ROI) for both companies. Which company is performing better
2. Go to Yahoo! Finance (http://finance.yahoo.com/) and find the income statements for two other competing companies. Perform the same analysis for these companies that you performed in the previous question. Which company is doing better overall and with respect to marketing? For marketing expenses, use 75 percent of the company's reported "Selling General and Administrative" expenses.
For the period ending January 2012, Walmart reported profits of almost $16 billion on sales of just under $450 billion. For that same period, Target posted a profit of $3 billion on sales of almost $70 billion. Walmart is a better marketer, right? Sales and profits provide information to compare the profitability of these two competitors, but between these numbers is information regarding the efficiency of marketing efforts in creating those sales and profits. Appendix 24, Marketing by the Numbers, discusses other marketing profitability measures beyond the return on marketing investment (marketing ROI) measure described in this chapter.
Review Appendix 24 to answer the questions using the following information from Walmart's and Target's income statements (all numbers are in thousands):

 







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