“Baldwin’s Traditional product Basket finished 2019 with an awareness of 72%. One-third of Basket’s existing awareness is lost every year. What is the minimum that Basket s product manager should spend in promotion to earn have an awareness level of 92% at the end of 2020? The first $1million in promotion generates 26% of new awareness, the second million will add 18% more awareness and the third million adds another 5% awareness. ”
we have been provided with the following information
Baldwin’s Traditional product Basket finished 2019 with an awareness of 72%.
One-third of Basket’s existing awareness is lost every year.
The first $1million in promotion generates 26% of new awareness, the second million will add 18% more awareness and the third million adds another 5% awareness.
So to calculate minimumamount that Basket s product manager should spend in promotion to earn have an awareness leve of 92 % in 2020 is as follow
| Awareness
% |
|
| 2019 awareness of | 72% |
| Lost in next year (One-third of Basket’s existing awareness is lost every year.= 1/3 x 72%) | (24%) |
| first $1million in promotion generates | 26 % |
| the second million will add | 18 % |
| Total | 92 % |
So Basket s product manager should spend in promotion existing plan plus two Million more to get awareness level of 92% at the end of 2020?
