8.14 Assume the company expects to sell 5 million packages of Pop-Tarts Gone Nutty! in the first...

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8.14 Assume the company expects to sell 5 million packages of Pop-Tarts Gone Nutty! in the first year aft er introduction globally, but expects that 80 per cent of those sales will come from buyers who would normally purchase existing Pop-Tart flavours (that is, they will be cannibalised sales). Assuming the sales of regular Pop-Tarts are normally 300 million packs per year and that the company will incur an increase in fixed costs of €500,000 during the first year to launch Gone Nutty!, will the new product be profitable for the company? Refer to the discussion of cannibalisation in Appendix 2 for an explanation regarding how to conduct the analysis. (AACSB: Communication; Analytical reasoning)

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Strategic Marketing Management

ISBN: 9781936572199

8th European Edition

Authors: Alexander Chernev, Philip Kotler

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