1. Chapter Sixteen Market-Based Management and Financial Performance

2. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall16-2 Market-Based Management and Financial Performance How to overwhelm customers and shareholders Customer satisfaction and shareholder value Marketing strategies and profitability Marketing strategies and assets Return measures of profitability Measures of shareholder value

3. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall16-3 How to Overwhelm Customers and Shareholders Figure 16-3 How to Overwhelm Customers and Shareholders

4. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall16-4 Customer Satisfaction and Shareholder Value Figure 16-4 Customer Satisfaction

5. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall16-5 Customer Retention Figure 16-7 How Customer Retention Impacts Net Profit and Earnings Per Share

6. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall16-6 Marketing Strategies and Profitability How are market- based net profits derived? Figure 16-8 Market-Based Management Model of Profit Before Taxes

7. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall16-7 Marketing Strategies and Assets How do Marketing Strategies affect assets? –Accounts receivable –Investment in inventory –Investment in fixed assets

8. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall16-8 Return Measures of Profitability How does Net Marketing Contribution affect Net Profits? –Return on Sales (ROS) Net Profit/Sales –Return on Assets (ROA) Net Profit/Assets –Return on Equity (ROE) Net Profit/Equity

9. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall16-9 Measures of Shareholder Value How does Market-Based Management affect Shareholder Value? –Earnings Per Share (EPS) –Price Earnings Ratio (PE) –Economic Profit (EP)

10. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall16-10 Measures of Shareholder Value Figure 16-12 How Marketing Profits Contribute to Earnings Per Share

11. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall16-11 Measures of Shareholder Value Figure 16-13 Market-Based Management and Shareholder Value

12. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall16-12 Review How to overwhelm customers and shareholders Customer satisfaction and shareholder value Marketing strategies and profitability Marketing strategies and assets Return measures of profitability Measures of shareholder value

13. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall16-13 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright © 2009 Pearson Education, Inc. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall