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Which 2 statements should be recorded under the Reasons heading?

Scenario
Additional Information
During the initiation stage the Project Manager met with the Marketing Director to find out more
about the requirements of the promotional calendar and recorded the following notes:
There has been a reduction in the order numbers at the MNO Manufacturing due in part to the
increased marketing activities of its competitors. 10% of customers have not re-ordered in this
financial year and staff morale is poor. A number of skilled staff have left as a result and
replacement staff have not been recruited due to the reduced operation. If the project is
successful, a recruitment campaign will be required to fill the existing staff vacancies and there
may be a requirement for additional staff. Operational costs are likely to increase because skilled
staff are expensive and difficult to find.
In financial terms, there were a total of 1,500 orders in the last financial year, each with an
average profit of £2k. The Marketing department believes that sending a promotional calendar to
our current and prospective customers would increase orders by at least 10% with a minimum of
10 further orders from the list of prospective customers within 12 months from the date of
distribution.
The Marketing Director will be funding the project from the business marketing budget. She
believes that the effect of a good company image portrayed by a successful calendar would last
into a second year. She has forecast the same increase in orders for a second year and predicts
that the annual employee satisfaction survey will show a measurable improvement in staff morale.
A number of alternatives were explored, including:
20% discount for all repeat customers – not cost-effective and very short term
A promotional calendar as a free Christmas gift – would target current and prospective
customers and the benefits would last into a second year
A series of television and press advertisements was too expensive
A direct mail shot to all customers – benefit would be short term
Creation of an internet website – would not suit all customers
The calendar is seen as the favored option, as long as the company’s competitors do not increase
their marketing activity. Whilst the Marketing department wants a very high quality, glossy product,
the project management team must be aware of the cost this will incur.
Which 2 statements should be recorded under the Reasons heading?

PrepAway - Latest Free Exam Questions & Answers

A.
The Marketing department believes that sending a promotional calendar to current and
prospective customers will increase orders by at least 10%.

B.
10% of customers have not re-ordered in this financial year.

C.
1,500 orders are expected, each with an average profit of £2k.

D.
The Marketing department believes that the effect of a good company image, portrayed by a
successful calendar, will last into a second year.

E.
MNO Manufacturing is experiencing a fall in orders due in part to the increased marketing
activities of its competitors.


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