The ABC software company sells both to consumers and has an enterprise division that sells to businesses with a sales force that calls on prospects and customers They operate internationally and have sales offices in almost every country Each country determines how much to spend on advertising and promotion Each country also manages its own sales force for enterprise sales They were curious as to the correlation between adverting promotional spend and sales growth for enterprise sales Specifically Does increase spending on adverting and promotion really increase sales, and to what degree To measure this, they compared the percent of sales spent on advertising promotion versus the percent of sales growth to see if there was a correlation They looked at several countries to compile and compare data Further, they averaged the percentages for both variables over three years They looked primarily at larger countries figuring it would provide the best data Here were the results Country Ave annual increase in sales over the last three years for enterprise sales Ave annual of sales spent on advertising and promotions over the last three years Australia 12 6 Brazil 9 10 Canada 6 8 China 11 3 England 14 11 France 7 14 Germany 12 12 United States 10 16 When the study was over, they concluded there was not any meaningful correlation 1 Since it was relatively easy to measure the two variables, assume the data is accurate As it relates to the concepts in your text chapter 17, what possibly is wrong is with the analysis approach 2 This following question extends somewhat beyond the scope of the chapter or text, but not completely Give it some thought and feel free to expand on any type of explanation What was the company overlooking beyond your answers in question 1 what else could explain the lack of meaningful correlation 3 What can you think of that may have strengthened the process used or the quality of the results If you feel it cannot be done, explain why (There is no perfect or one right answer The question is intended to probe the thoughts )

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The ABC software company sells both to consumers and has an enterprise division that sells to businesses with a sales force that calls on prospects

The ABC software company sells both to consumers and has an enterprise division that sells to businesses with a sales force that calls on prospects and customers. They operate internationally and have sales offices in almost every country. Each country determines how much to spend on advertising and promotion. Each country also manages its own sales force for enterprise sales. They were curious as to the correlation between adverting/promotional spend and sales growth for enterprise sales. Specifically: Does increase spending on adverting and promotion really increase sales, and to what degree?

To measure this, they compared the percent of sales spent on advertising promotion versus the percent of sales growth to see if there was a correlation. They looked at several countries to compile and compare data. Further, they averaged the percentages for both variables over three years. They looked primarily at larger countries figuring it would provide the best data. Here were the results:

Country	Ave. annual % increase in sales over the last three years for enterprise sales	Ave annual % of sales spent on advertising and promotions over the last three years
Australia	12	6
Brazil	9	10
Canada	6	8
China	11	3
England	14	11
France	7	14
Germany	12	12
United States	10	16

When the study was over, they concluded there was not any meaningful correlation.

1. Since it was relatively easy to measure the two variables, assume the data is accurate. As it relates to the concepts in your text/chapter 17, what possibly is wrong is with the analysis/approach?

2. This following question extends somewhat beyond the scope of the chapter or text, but not completely. Give it some thought and feel free to expand on any type of explanation. What was the company overlooking beyond your answers in question 1; what else could explain the lack of meaningful correlation?

3. What can you think of that may have strengthened the process used or the quality of the results? If you feel it cannot be done, explain why (There is no perfect or one right answer. The question is intended to probe the thoughts.)