Review Cases 2.29 and 2.30 in your textbook. Respond to the questions in 2.30, supported by data that you calculate for 2.29. Discuss how a company's policy can encourage or prevent employees from engaging in unethical behavior in order to meet quotas.

2.29 (LO 1) Calculate expected costs Bohlander Botanicals develops hybrid tea roses. A relative newcomer to the field, Bohlander is looking for innovative ways to advertise its products to potential customers. Rose Mayfield, sales manager and avid online shopper, wonders about advertising the companys roses on various gardening websites. She has contacted Kimland Media, Inc., an advertising firm specializing in Internet advertising campaigns, to explore some options. After meeting with Rose, Sami Landon, regional sales coordinator, has suggested that Bohlander use a targeted marketing strategy by placing banner ads on a few gardening websites. Bohlander would pay for the service based primarily on the number of ad impressions (the number of times the ads are shown). Using past campaigns as a guide, Sami has prepared the following quarterly estimate for Bohlander.

Banner ad development (6 banners per quarter) $7,200

Banner ad placement $1.50 per thousand impressions

Estimated ad impressions 1,000,000

Banner ad click-throughs $0.60 per click-through

From past experience, Kimland Media estimates that 1% of all viewers will click through the banner ad to Bohlanders website. Of those viewers who click through, Kimland estimates that 20% will actually make a purchase. Required

What is the expected total cost per quarter of Bohlanders Internet advertising campaign? Given Samis cost estimates, what is Bohlanders expected cost of acquiring a new customer through the campaign? Using the information you just calculated, what is the estimated cost to get one more person to click through and make a purchase?

2.30 Ethics (This is a continuation of Case 2-29) On March 15, Jeff Blake, Kimland Medias sales director, stopped by Sami Landons cubicle. Sami, Ive been reviewing your accounts, and they arent generating as much revenue as we had hoped. If you want to achieve your quota for the quarter, youre going to have to bump it up a bit. Sami thought for a few minutes about how she might increase her revenue pool. She could sign some new customers, but she didnt have any strong leads, and developing the ones she had would take too much time. She couldnt create new banner ads for her current customers. Then it dawned on her: She could increase her variable revenue through increased click-through counts on her existing banner ads. Sami got on the phone and called her friends and family members. I need a small favor. Would you go to www.tearosegarden.com and look for the Bohlander ad? Then just click through the ad as many times as you can. Required

Was it ethical for Sami to enlist the help of friends and family to drive up the number of click-throughs to Bohlanders website? Why or why not? Would your answer to part (a) change if Samis friends and family members actually made a purchase from Bohlander? Why or why not? What impact did Samis actions have on Bohlander Botanicals?