Overview & Context

A manager at Glossier is trying to make decisions on her portfolio. She manages three products: Milky Jelly Face Wash, Generation G Lipstick, and the new Silky Hands Sanitizer. These products are in separate sub$-$industries within the overall beauty industry.

Because of the pandemic, the lip color category has taken a hit. Sales have declined for the past $2$ years. Most analysts agree lip color is going to shrink by $1\%$ next year. The pandemic shifted consumer preferences towards skincare. Hand care is expected to grow by $5\%$ next year and face skin care is expected to grow three times as fast as hand care.

Product Portfolio

Luxury Hand Sanitizer. For Glossier, hand sanitizer revenues were $$800$K$.$ Each costs Glossier$$s R&D team $$2\mathrm{.}99$ to produce and they sell each bottle for $$14.$ They ran an online advertising campaign that cost $$100$K$.$ Their biggest competitor is a brand called Touchland, that had $$1\mathrm{.}2$M in revenues, but they distribute through Sephora. Glossier and Touchland represent small shares of the overall $$hand care$$ market, but they represent the dominant players in their smaller $$luxury hand sanitizer$$ market: $33\%$ and $42\%$ each, respectively. They are each other$$s nearest largest competitors.

Ultra$-$Gentle Facewash. The face wash category is fractured. Glossier Milky Jelly $($$$12$M revenues$)$ competes most closely with Fresh Soy Face Cleanser $($$$11$M revenues$)$ and E$.$L$.$F$.$ Bounce Coconut Cleanser $($$$6$M in revenues$).$ Glossier Milky Jelly comes in two different bottle sizes: retailing for $$18$ per bottle $($full size, accounting for $75\%$ of revenues aka $$9$M$)$ and $$9$ per bottle $($mini size, accounting for $25\%$ of revenues aka $$3$M$).$ The per unit COGS for both the full and mini bottle is $$1\mathrm{.}55.$ To advertise this product Glossier took out ads in major beauty magazines in the amount of $$75$K per month for $12$ months. These three brands represent the dominant players in the ultra$-$gentle facewash category. Glossier$$ relative market share is $1\mathrm{.}1,$ while Fresh has a relative market share of $0\mathrm{.}9,$ and E$.$L$.$F has a relative market share of $0\mathrm{.}6.$

Trendy Lip Color. The market for color lip products is projected to be $$200$M in revenue, with closest competitors Kylie Lip Kits and Fenty Lip Paint with $14\%$ share each. Generation G Lip is projected to capture about $11\%$ of the market in revenues. Each tube of Generation G costs $$0\mathrm{.}65$ to manufacture and retails for $$18.$ Glossier ran $$200$K of billboards in each of $20$ top cities to advertise this product.

For all products, assume units sold $=$ units produced.

What are Glossier's Total Revenues?

Group of answer choices

About $$32$M

About $$27\mathrm{.}5$M

About $$35$M

About $$2\mathrm{.}2$M

Flag question: Question $2$

Question $210$ pts

What was the Contribution After Marketing for Glossier's Generation G lip color?

Group of answer choices

~$$22$M

~$$17$M

~$$4$M

~$$21$M

Flag question: Question $3$

Question $310$ pts

How many bottles of hand sanitizer did Glossier produce?

Group of answer choices

About $600,000$

About $6,000,000$

About $60,000$

About $6,000$

Flag question: Question $4$

Question $410$ pts

What is the COGS for the Large Facewash?

Group of answer choices

Approx. $$500$K

Approx. $$775$K

Approx. $$1\mathrm{.}3$M

Question $5$

How much does Glossier spend to promote their Lip Color?

Group of answer choices

$$4$M

$$200$K

$$1$M

$$10$K