Section B- Application with numbers

1. Bottled water is a hot industry with sales of $16 billion in the United States. Big players in this industry include Nestl, PepsiCo, and Coca-Cola. Nestl is the market leader with four brands in the top 10 leading brands. Nestls Pure Life brand was the top-selling brand with sales of $1.5 billion, but the companys other brands make up an additional $2.5 billion, giving the company total overall sales of $4 billion.

Nestl saw opportunity in this market and launched a new brand called Resource, targeted to affluent women. Resource is fortified with electrolytes and is promoted as more than hydration, its total electrolytenment. Nestl is attempting to take market share away from Glaceaus Vitaminwater and Smartwater. If Resource attains just 2 percent market share, it will be in the top 10 selling brands.

a) Calculate Nestls Pure Life and the companys overall market share in the bottled water industry. (5 marks)

b) Assuming total market sales remain the same, what sales must Resource attain to be in the top 10 selling brands? (5 marks)