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

Rafael Barreiros Porto, Rafaela da Rocha Costa, Eluiza Alberto de Morais Watanabe

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.


Keywords


Marketing activities; business performance; microenterprise; profitability and sales.



DOI: http://dx.doi.org/10.7819/rbgn.v19i65.2911

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