When a new product enters a market the new sales of that prodcut will come from two sources. Some of the sales will come from entirely new purchases that would have never been made if the new product didnt come to market. 

Some of the sales will come from new product taking away purchases from the existing products.

 

The easy way to estimate what will happne to the market of other competitors is use an approach called the "Fair Share Draw".

The Fair Share Draw rule make the assumption that the new products sales that come from existing competitors will come direct proportion to the existing market share of those products . the current makret situation is shown  below...

                                       sales                  market share 

Existing Product A          $700                 35%

Exisitng Product B          $700                 35%

Existing Product C          $600                30%

 

Now a new product is introduced , and the sales revenue was $1000.

If  the new products sales from three exisitng competitors come in 25% of the exisiting market share, what is the new sales revenue of Product C?

What is the sales revenue from entirely new purchases?