Question: calculate the contribution from incremental sales, contribution foregone from the baseline sales and the net contribution to profit from the promotion. Discuss whether this price
calculate the contribution from incremental sales, contribution foregone from the baseline sales and the net contribution to profit from the promotion. Discuss whether this price promotion is profitable. During pre promotion period, brand market share was 7%, cateogry sales per week was 2 million, duration was 4 weeks, variable cost per unit was $90, selling price per unit was $150. During promotion period, brand market share was 10%, category sales per week was 2 million, duration was 3 weeks, variable cost per unit was $90, selling price per unit was $140. During post promotion period, brand market share was 5%, category sales per week was 2 million, duration was 2 weeks, variable cost per unit was $90 and selling price per unit was $150.
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Solution During the prepromotion period the brands market share was 7 and the category sales per week were 2 million The promotion lasted for 3 weeks and during this period the brands market share inc... View full answer
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