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Chapter 1 The Role of Accounting in Business Based Analysis MBA 1-1 Quantitative metrics Interpublic Group of Companies Inc. (IPG) is an that operates throughout the world. In addition, the company provides event planning, public relations, and brand management services. Twitter Inc. (TWTR) operates as a worl wide platform for individuals to communicate with each other by sending Tweets using their mobile devices. advertising and marketing service company d- For each company, go to the Securities and Exchange Commission (SEC) Internet site http://www.sec.govfedgar/searchedgar/companysearch.html. In the search box “Fast Search,” enter the Central Index Key (stock market ticker symbol) shown next to the company name. Once the EDGAR Search screen appears, t Open the most recent 10-K file and search the file for “metric” using the “Edit and Find” functions, 09 ype in 10-K for Filing Type. 1. List the quantitative metrics that appear in each company’s 10-K. 2. Comment on the differences in the metrics for each company listed in (1).
Expert Answer
1. Metrics are a common measuring platform for companies to measure the success, or otherwise , of their business. The companies set standards for their performance levels that they want to attain against these metrics. Quantitative metrics, being the easiest to measure,as compared to the qualitative ones are often broken down into numbers or easily measurable data. |
Examples of quantitative metrics are number of times that users click on to a website called click -through rates, time spent on these sites, or no.of visitor counts, or any other measure in online marketing–all that can be represented numerically. |
Accordingly, quantitative metrics, against which performance are measured — for the following two companies are: |
Twitter Inc. (TWTR) |
Monthly active users, or MAUs |
changes in daily active users or daily active usage, or DAUs |
changes in ad engagements |
changes in cost per ad engagement |
Inter Public Group of Companies Inc. (IPG) |
The key performance metrics used to evaluate the results include: |
the organic or profitable change in revenue |
salaries and related expenses |
office and general expenses and |
the components of operating expenses expressed as a percentage of total consolidated revenue |
2. Differences in the measuring metrics or yardsticks are due to the nature of business operations ,products/services offered and the way revenues as also the clientelle are generated: |
Twitter, is a global platform for public self-expression and conversation in real time |
allows people to consume, create, distribute and discover content |
not limited to only logged-in users on the Twitter platform, but extends to a larger global audience |
Many of the world’s most trusted media outlets, including the BBC, CNN and the Associated Press, regularly use Twitter as a platform for content distribution. |
On the other hand, |
With IPG, |
one of the world’s premier global advertising and marketing services companies |
specialises in consumer advertising, digital marketing, communications planning and media buying, public relations and specialized communications disciplines |
revenues are primarily derived from planning and execution of multi-channel advertising, marketing and communications programs around the world |
revenues are directly dependent upon the advertising, marketing and corporate communications requirements of our existing clients and its ability to win new clients |
client contracts are individually negotiated, and, accordingly, the terms of client engagements and the bases on which commissions are earned and fees vary significantly |