User Account

All Pages

Profitable marketing alternative to promote business

Assignment Help Business Management
Reference no: EM1334827

Exquisite Foods Incorporated (EFI) sells premium foods. Three independent strategies are being considered to promote a new product, Soufflés for Microwaves, to dual-career families. Currently the contribution margin ratio on EFI's foods is 65% which is expected to apply to the new product. EFI's policy for promoting new products permits only one type of advertising campaign until the product has been established.

Strategy One. The first strategy concentrates on television and magazine advertising. EFI would hire a marketing consultant to prepare a 30-second video commercial and a magazine advertisement. The commercial would air during the evening to address the working market, while the magazine advertisement would be placed in magazines read by career-minded individuals. This advertising campaign would provide EFI $230,000 expected contribution from sales.

Strategy Two. The second strategy promotes the product by offering 25% off coupons in the Sunday newspaper supplements, with a projected 15% redemption rate on sales revenue. EFI would hire a marketing consultant for $5,000 to design a one-quarter page, two-color coupon advertisement. The coupon would be distributed in the Sunday newspaper supplements at a cost of $195,000. Based on prior experience, EFI expects the following additional sales from this form of advertisement:

Expected sales Probability
$500,000 10%
600,000 25%
700,000 35%
800,000 20%
900,000 10%

Strategy Three. The third strategy offers a $0.50 mail-in rebate coupon attached to each box of Soufflés for Microwaves. EFI would hire a marketing consultant for $5,000 to create a one-sixth page, one-color rebate coupon. Printing and attaching costs for the rebate coupon are $0.07 per package and EFI is planning to include the rebate offer on 500,000 packages. Although 500,000 packages may be sold, only a 10% redemption rate is expected. EFI expects the following additional sales from this type of promotion:

Expected sales Probability
$400,000 10%
450,000 30%
500,000 35%
550,000 20%
600,000 5%

Required

1. EFI wishes to select the most profitable marketing alternative to promote Soufflés for Microwaves. Recommend which of the three strategies presented above should be adopted by EFI. Support your recommendation with appropriate calculations and analysis; the calculations should appear on a separate sheet of paper, not included in the page limit for the writing assignment.

2. What selection criteria, other than profitability, should be considered in arriving at a decision on the choice of promotion alternatives?

Reference no: EM1334827

Questions Cloud

Design a flowchart and pseudocode using control breaks : design a flowchart and pseudocode using control breaks that enable the user to print invoices for any raw material that is selected.
The subsequent collapse of global financial markets : The conventional wisdom says the 1999-2006 residential real estate "bubble" in the U.S. and the subsequent collapse of global financial markets were caused by a failure of the free market. What's wrong with that assertion?
Also explain the methods governments use to promote : Explain the cultural, political, and economic reasons behind these policies also explain the methods governments use to promote and restrict international trade
Suggest starting points for a staffing plan : Suggested Starting Points for a Staffing Plan - It gives ideas on what areas to look at when developing a staffing plan for a Customer Service Environment.
Profitable marketing alternative to promote business : EFI wishes to select the most profitable marketing alternative to promote Soufflés for Microwaves. Recommend which of the three strategies presented above should be adopted by EFI.
A class named customerrecord that holds customer number : create a class named CustomerRecord that holds a customer number, name, and address. Include methods to set the values for each data field and output the values for each data field. design the class diagram and write the code (not language specifi..
About non-compete agreements : What is non-compete agreements?
Implement and maintaining the plan : Prepare a paper designing elements of an employee relations program from an organization of your choice. Identify policy implications, the goals of the program, how these goals support corporate goals, and the cost and benefits of implementing and..
Elucidate why do you think us investors in mexico : Elucidate why do you think U.S. investors do not try to capitalize on the high interest rates in Mexico.

Reviews

Write a Review

Business Management Questions & Answers

  Describing organizational ethics and social responsibility

Imagine you are the marketing manager for a product that is used daily, such as coffee or paper towels, and you are selected to introduce the product to a new international market.

  Promotional theme of company promotion

Allegra is an antihistamine, and to create brand awareness, its manufacturer is offering people who request information about the product a cushion to use at their favorite sporting event-This use of the same promotional theme throughout a company'..

  Disability discrimination

Discuss a minimum of five benefits of organizational diversity. Identify at least three factors that have led to increased emphasis on disability discrimination in the workplace.

  Discuss in relation to the agency problem

This situation gives professional managers an opportunity to pursue their own interest instead of that of shareholders. Major effort of researchers has been devoted to models in which capital structure is determined by agency costs.

  Flow chart of organization

Design a flow chart of an organization of your choice. The organization cannot be a restaurant or a fast-food restaurant.

  Cross-cultural ethics

A member of one culture might not view situation with same ethical perspective as a member of another culture. Given this, what can an organization do when faced with an ethical dilemma complicated by cross-cultural considerations?

  Identify the costs involved in the globalization process

Identify the costs involved in the globalization process. What are the major issues? What companies seem to promote corporate responsibility in all aspects of their businesses?

  Value of ratio analysis in decision making

Discuss the value of ratio analysis in decision making for heath care organizations.

  Workforce remedy varying self-perceptions

How would you as a leader of an increasingly androgynous workforce remedy such varying self-perceptions.

  What kind of tool is this

On the back of an envelope, Phoebe writes: "I promise to pay $ 600 Characteristic or bearer on demand [Signed] Phoebe .." What kind of tool is this?

  Unprecedented array of macro environment challenges

There is an argument that leaders today face an unprecedented array of macro environment challenges -- globalization, diversity, fast pacing, constant change.

  Explaining resources allocated and prioritized

How were resources allocated and prioritized.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd