8.14 Assume the company expects to sell 5 million packages of Pop-Tarts Gone Nutty! in the first...
Question:
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)
Step by Step Answer:
Strategic Marketing Management
ISBN: 9781936572199
8th European Edition
Authors: Alexander Chernev, Philip Kotler