Yearly Max Search Volume)	1st Position CTR	2nd Position CTR	3rd Position CTR	Avg. CTR non-position campaigns	1st Pos CPC	2nd Pos CPC	3rd Pos CPC	Avg. CPC (non-position campaigns)*	Conversion Rate	AOV
Paid Search:
PS - Branded	100,000	13%	11%	9%		$2	$1.50	$1.20		5%	$75
PS - Non-branded	400,000	7%	5%	4%		$2	$1.50	$1.20		2%	$75
PS - Shopping	200,000				11%				$2	4%	$75
PS - Remarketing	300,000	11%	9%	8%		$2	$1.50	$1.20		3%	$75
PS - Display**	500,000				2%				$2	1%	$55
PS - YouTub	1,000,000				1%				$2	1%	$55

You are the Digital Marketing Manager for Nike's new sub-brand: the "Air DMM". It's a whole new sub-brand that Nike is introducing for June, 2020. You have been given a yearly digital marketing budget of $100,000.

Your boss has said the # 1 goal is to MAXIMIZE gross profit with the limited budget that you have. Gross profit in this case is calculated as follows:

Total revenue minus total advertising cost = gross profit.

The cost of manufacturing the Air DMM is very low, so the manufacturing cost is not important. For this exercise, the only cost is your advertising cost.

You can use any combination of the paid search campaign types.

NOTE: For any Paid Search campaign types, your ad can only be in one specific position. So, if you want to use "PS - Branded," you can choose only ONE position: 1st, 2nd, or 3rd position. You cannot be simultaneously be in # 1, # 2, and # 3 in "PS - Branded".

Of course, you can use a mix of the 6 paid search campaign types in the chart. For example, you can choose to spend $20,000 on Branded and $50,000 on YouTube, and $30,000 on Shopping for a total of $100,000.

Questions:

1 - How are you going to maximize the gross profit with the budget?

Please tell me the campaign types, the position you will choose for each type, and how much you will spend on each campaign type.

Also, what is the resulting gross profit?

2 - Based on your answer in question # 1,

Explain why different campaign types produce different gross profit results

3- In question # 1, you calculated the different spending on different campaign types to get the maximum gross profit.

Now, for each order, the cost of manufacturing is $10.

The net profit is your gross profit you calculated in question # 1 minus the total cost of manufacturing

What is the NET profit?