The multilevel effect of marketing activities on sales, revenue and profitability in a micro-enterprise

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.

Bus Station Fees Unit Root Testing during A Transition Time: A Time-series Microeconomics Development, Consistencies and Theoretical Unification

“…We enrich the microeconomics side of the third time-series microeconomics group by the joint revenue observation that consists of Passenger, Parking, Long-distance and Short-distance fees observation. It is different from single revenue and single price as studied by [32].…”

“…We studied a revenue. It places us in the group that observing time-series microeconomic variables such as [26], [29], [30], [31], [27], [28] and [32].…”

“…The second group studies microeconomic time-series data such as by [26], [27] or [28]. The third group studies microeconomic time-series data and employs unit root tests such as by [29], [30], [31], and [32].…”

“…Looking in-depth to the third group we found that researchers above observed varied microeconomic variables such as product, price, revenue, cost and profit. Some of them observe the microeconomic variables under the persistence flag based on panel data unit root tests as [29] and [31], while others prefer to estimate time-series microeconomics models and employs ADF and PP tests as [30] and [32]. Their studies strengthen the third group but they are different from the pure time-series microeconomic persistent variable examination study.…”

Department of Trade and Industry (DTI) IV: A marketing assistance to micro, small, and medium enterprises and its financial impact: Inputs to marketing plan

“…An understanding of how the tools and strategic elements work helps businesses implement market strategies that increase profits. Porto, Costa, and Watanabe (2017) demonstrated in their study the effectiveness of marketing activities in dynamically generated product sales, revenue, and profitability in a microenterprise. They mentioned that if the micro-enterprise maintains its operations over time, it is because the marketing activities carried out to generate a minimally positive effect on product sales.…”