Cannibalization, Marketing Management

Assignment Help:
Assume Clinique expects to sell 3 million ounces of BB cream within the first year after introduction but expects that half of those sales will come from buyers who would otherwise purchase Clinique’s moisturizer (that is cannibalized sales). Assume that Clinique normally sells 10 million ounces of moisturizer per year and that the company will incur an increase in fixed costs of $2 million during the first year of production for the BB cream, will the product be profitable for the company? $9 million sales for BB cream first year. The new BB cream will garner a high price for the manufacturer ($10.00 per ounce for the BB cream vs $8.00 per ounce for the moisturizer). It also comes with higher variable cost ($6.00 per ounce for the BB cream vs $3.00 per ounce for the moisturizer cream)

Related Discussions:- Cannibalization

Algebra , the ordered pair (-1, -1) is a solution of the system -4x + 2y = ...

the ordered pair (-1, -1) is a solution of the system -4x + 2y = 2 and x + y = -2. true or false

A assignment, rs. 50 a vibrant nail paint 10 ml

rs. 50 a vibrant nail paint 10 ml

Describe the components of the promotion mix, Question 1: "Promotion p...

Question 1: "Promotion performs a significant and vital role in the marketing strategy of an organization." Using an organization of your choice, describe the component

Describe what is meant by the friedman doctrine, Nike's use of "sweatshop l...

Nike's use of "sweatshop labor" in Southeast Asia led to a wave of protests against the company in the United States. Not only did this hurt Nike's reputation, but it also adversel

Undermining the position of women - ethical aspects of ads, Q. Undermining ...

Q. Undermining the Position of Women - ethical aspects of ads? A few ads are undermine the position of aged persons, women. In a few cases women are shown as sex-object. They a

Video games, Ask question #Minimum 100 words should video games companies c...

Ask question #Minimum 100 words should video games companies continue to alter their products to include other function , such as email?accepted#

Test marketing - new product development, Test Marketing The  seventh ...

Test Marketing The  seventh  step  is  test  marketing that  is the  stage  at  which  the  manufacture  and  marketing programs are introduced into more accurate marketing se

Determine the use of viral marketing in promotional campaign, Question 1: ...

Question 1: (a) As a Consultant in direct marketing, how would you convince your corporate customers to use the tools and techniques of direct marketing to grow their business

Inbound logistic, what are the inbound logistic,operation,out bound logisti...

what are the inbound logistic,operation,out bound logistic in service industry

Write Your Message!

Captcha
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!

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