The Research On Applying Strategic Cost Management To The Marketing Process

With the deepening of the world economic integration, the operating risk which all the corporations face is aggrandizing. In such circumstances, the traditional cost management method, which is empirical and rational, can't fix in with the requirement of the developing economic. The problem is more obvious in the process of marketing cost management. Firstly, there is no systemic marketing cost management system in most companies; secondly, it's difficult for the traditional marketing cost budgeting and analyzing method to offer full and correct information. Thereby, it's essential to improve the level of marketing cost management, reform the method of marketing cost management.Accordingly, in this article, we use a whole new cost management method is called strategic cost management for dealing with the problems above. After comparing the character between the traditional cost management method and strategic cost management, we found it's the new method to help upgrading the traditional method, which focusing on three aspects: firstly, it emphasizes not only bringing down the cost but also enhancing the strategic position of a company in the cost management process. Secondly, it emphasizes analyzing not only the activity cost driver but also the strategic cost driver. Thirdly, it emphasizes not only cost methods of managerial accounting but also other methods including value chain analysis and ABC etc.Hence, we carry out some research on applying strategic cost management to control marketing cost based on the analysis of two method of cost management mentioned before. Then we frame a new system for the marketing cost management called strategic marketing cost management (SMCM) based on the Shank Model, which is one of the strategic cost management model. SMCM stress on combining 'controlling cost before occurring ' and 'controlling cost after occurring'. In order toanalyze the difference in calculation of the two methods and their influence on the strategy of the corporation, we use the marketing cost of international department of AA group in 2003 as subject matter.Our study manifest that marketing cost among different customers can be transferred. Adopting strategic marketing cost management, such problem can be avoided. Strategic cost management method can get precise information of cost thus enable the administrators to integrate cost, bring down cost and enhance competition ability of the corporation.