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Flashcards in Marketing and Finance Deck (32)
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31

ROMI can be used for?

- Marketing communications tasked to have a direct impact on sales (Direct marketing, Sales promotion, Advertising focused on price or activation, Events/ trade shows with direct sales on objectives
- Loyalty programs
- New product launches (relatively incremental innovations)

32

ROMI Problems

- Difficulty in disaggregating interactions among the effects of the elements of the marketing mix
- Maximising ROMI may mean minimising expenditure which may result in lower $ profits
- Formula assumes marketing primarily impacts revenues and not margin strength
- Formula treats marketing as variable cost
- Linking marketing to finance is ill-advised where it would be the most interesting