Abstract
Purpose – This study dynamically assessed the effectiveness of marketing activities in the generation of product sales, revenue, and profitability in a micro-enterprise, a context that lacks research in marketing. Design/methodology/approach – A longitudinal multilevel study was conducted using daily panel data for 5,800 products sold and monthly time series on the business level, involving 26 months of commercial and financial records for a micro-enterprise (a drugstore). Panel and time series regressions were performed. Findings – The research shows that (1) marketing activities, in particular price elasticity, quite accurately generate product sales, (2) the aggregated estimate of total marketing activities predicts monthly company revenue and profitability, and (3) in the investigated company, if marketing activities are intensified in the same proportion to increase costs in products and goods, they are not efficient in generating profit. Originality/value – This research supports investigations concerning micro-macro level analysis relationships with commercial and financial data in order to merge marketing decisions to finance.
Highlights
Marketing activity is characterized as being a management task that involves planning the conception of products, their price, promotions, and distributions to meet consumer demand (Wilkie & Moore, 2007)
The result of the micro-micro analysis is revealed, in which the explained variable is the sales of each product and the explanatory variables are each marketing activity implemented by the company daily
The present paper demonstrates that the marketing activities generate a dynamic effect both on product sales and company net revenue and profitability
Summary
Marketing activity is characterized as being a management task that involves planning the conception of products, their price, promotions, and distributions to meet consumer demand (Wilkie & Moore, 2007). It is a set of entrepreneurial actions that are part of the management process that connects a business with its consumers and can be configured in several ways (Finkelstein & Peteraf, 2007). It is generally measured as an amount of managerial work executed in sales, converting input into output. Due to the operational limitations involving how to measure activities and how to relate them to business performance indicators, researchers have made few advances in the scientific knowledge that could improve the effectiveness of marketing management
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