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WHAT ARE THE PRINCIPAL ARGUMENTS FOR REDUCING THE TRADE PROMOTION BUDGET?

WHAT ARE THE PRINCIPAL ARGUMENTS FOR REDUCING THE TRADE PROMOTION BUDGET?

Evaluate the effectiveness of past RBS consumer and trade promotions. How have the promotional strategies impacted sales volume? For 2006, what was the return on investment for the various consumer and trade promotions? (Highlight these values in yellow.)

What are the principal arguments for maintaining significant trade promotion expenditures? What are the principal arguments for reducing the trade promotion budget?

Alternatives for reaching the 2008 target profit can be achieved by: 1) increasing price, 2) cutting the marketing budget, 3) increasing price and cutting the marketing budget, or 4) increasing price and increasing the marketing budget. Evaluate each of these alternatives.

How much of a price increase would be required to meet the 2008 target profit if no other changes occurred? (Highlight this value in yellow.)Include this in the section on increasing price. How much of a decrease in marketing budget would be required to meet the 2008 target profit if no other changes occurred? (Highlight this value in yellow.) Include this in the section on cutting the market budget.

Recommend a strategy for achieving the 2008 target profit? Explain your reasoning. What are the long-term strategic implications of your recommendation?

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