Value Above Cost Driving Superior Financial

Establish Rock-Solid Linkages among Marketing, Branding, and Business Performance

Donald E. Sexton, Ph.D., is Professor of Business at Columbia University, where for more than forty years he has taught marketing and quantitative methods and earned the Business School’s Distinguished Teaching Award. His numerous articles on marketing return, marketing, and branding strategy have appeared in publications such as the Harvard Business Review, Journal of Marketing Research, and Management Science. He is often quoted in media such as The New York Times, BusinessWeek, and WCBS. Dr. Sexton is the principal of The Arrow Group, Ltd.® which has provided consulting and training to companies such as GE, IBM, Pfizer, Unilever, Citigroup, DuPont, and Verizon. He has taught at the China Europe International Business School, UC-Berkeley, INSEAD, the Indian School of Business, the Australian Graduate School of Management, Skolkovo, and the U.S. Business School in Prague. Sexton holds an M.B.A. and Ph.D. from the University of Chicago in business economics, statistics, and mathematical methods and a B.A. from Wesleyan University in mathematics and economics. His books include Marketing 101, Branding 101, and Marketing and Management Science.

Foreword	p. xviii
Acknowledgments	p. xx
About the Author	p. xxi
Marketing and Financial Performance	p. 1
Determining Marketing Accountability	p. 5
The Value of a Business	p. 7
Customer Value and Costs	p. 9
Perceived Value	p. 10
A New Definition of Marketing	p. 11
CVA®	p. 12
Cost Orientation	p. 13
Value Orientation	p. 17
CVA® Orientation	p. 19
Strategic Themes	p. 21
Design and Communication	p. 25
CVA® and Economic Development	p. 29
Conclusions	p. 32
How CVA® Affects Financial Performance	p. 33
CVA® and Financial Performance: Executive Summary	p. 33
Perceived Value and Price	p. 35
Demand Curves	p. 39
Perceived Value and Revenue	p. 41
Contribution	p. 42
Revenue and Contribution: An Example	p. 44
Shifting the Demand Curve	p. 45
Sexton's Laws	p. 48
Sexton's Revenue Law	p. 48
Sexton's Contribution Law	p. 50
Employing Sexton's Contribution Law	p. 52
Contribution and Profit, Cash Flow, Shareholder Value, and Share Price	p. 56
CVA® and Life Time Customer Value	p. 58
Conclusions	p. 62
Appendix: Derivations	p. 63
CVA® over Time	p. 65
Levels of Sales Life Cycles	p. 66
The Competitive Life Cycle	p. 67
Sales Life Cycle	p. 69
Margin Life Cycle	p. 69
Unit Cost Life Cycle	p. 69
Perceived Value Life Cycle	p. 70
CVA® Life Cycle	p. 73
Financial Performance over Time	p. 76
Brand Equity	p. 78
Valuing Brand Equity	p. 81
Estimating Brand Equity	p. 83
Conclusions	p. 86
Perceived Value	p. 89
Expected, Actual, and Perceived Performance	p. 90
Marketing Ratios	p. 91
Determinants of Perceived Value	p. 92
Branding and Perceived Value	p. 95
Development of Perceived Value	p. 98
Stages of Buyer Behavior	p. 99
Managing Perceived Value	p. 104
Measuring Perceived Value	p. 112
Estimating Demand Curves	p. 121
Conclusions	p. 125
Costs	p. 127
The Income Statement in Custodial Format	p. 127
Types of Costs	p. 129
The Income Statement in Contribution Format	p. 131
Identifying Costs for CVA®	p. 134
Employing the Variable Margin Rate	p. 136
Graphing Contribution	p. 138
Fixed Costs	p. 139
Breakeven Sales Level	p. 139
Direct and Indirect Fixed Costs	p. 144
Shutdown Sales Level	p. 146
Evaluating Contribution	p. 147
Conclusions	p. 149
Managing CVA®	p. 151
Marketing Strategy Versus Marketing Tactics	p. 151
Components of a Marketing Strategy	p. 154
Identifying Possible Target Markets	p. 156
Evaluating Possible Positions for the Product or Service	p. 159
Determining Design	p. 167
Selecting Target Segments	p. 170
Developing Communications	p. 173
Managing the Brand	p. 176
Conclusions	p. 179
Managing CVA® over Time	p. 181
Managing CVA® Through the Market Life Cycle	p. 181
Financial Objectives Throughout the Competitive Life Cycle	p. 185
Managing CVA® Throughout the Competitive Life Cycle	p. 187
Introduction Stage	p. 192
Rapid Growth Stage	p. 196
Competitive Turbulence Stage	p. 199
Maturity Stage	p. 202
Decline Stage	p. 203
Optimizing Financial Performance over Time	p. 205
Conclusions	p. 210
Utilizing CVA® for Strategic Decisions	p. 211
Targeting	p. 212
CVA® and Market Segmentation	p. 215
Using CVA® to Target Market Segments	p. 219
Positioning	p. 223
Using CVA® to Determine Positioning	p. 226
Using CVA® to Evaluate Multiple Positions	p. 227
CVA® and "Grey Markets"	p. 232
Branding	p. 233
Using CVA® to Build a Brand	p. 235
CVA® and Brand Architecture	p. 237
CVA® and Brand Extensions	p. 241
CVA® and Co-Branding	p. 243
Conclusions	p. 246
Utilizing CVA® for Marketing Program Decisions	p. 247
Communications	p. 249
CVA® and Communications	p. 255
Using CVA® to Determine Communications Spending	p. 257
Pricing	p. 259
CVA® and Pricing	p. 262
Using CVA® to Determine Pricing	p. 262
Pricing in Multiple Markets	p. 265
CVA® and Distribution	p. 269
Conclusions	p. 273
Building the Marketing Accountability Scorecard	p. 275
General Practice	p. 276
Use of Specific Marketing ROI Measures	p. 279
Searching for a Marketing Accountability Scorecard	p. 284
Conclusions	p. 291
Organizing to Manage CVA®	p. 293
How Individuals and Organizations Behave	p. 295
Task Clarity	p. 297
Effort	p. 299
Rewards	p. 300
Capabilities	p. 301
Environment	p. 307
Results	p. 309
Conclusions	p. 310
Endnotes	p. 311
Index	p. 329
Table of Contents provided by Ingram. All Rights Reserved.

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Value Above Cost Driving Superior Financial Performance with CVA, the Most Important Metric You've Never Used

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Table of Contents

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