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Homework answers / question archive / Manufacturers and/or retailers use different methods to measure sales promotion effectiveness
Manufacturers and/or retailers use different methods to measure sales promotion effectiveness. The most common method is to compare market share before, during, and after a promotion.
(a) Given that the ABC Company has used a sales promotion - explain its effects on three user groups (i.e., existing users of the promoted brand, users of competing brands, and nonusers of the product category). "Suppose the ABC Company has a 20 percent market share in the pre-promotion time period, which jumps to 35 percent during the promotion time period, falls to 5 percent immediately after the promotion (i.e., immediate post-promotion time period), and rises to 10 percent after some time (i.e., long-term post-promotion time period)." In your explanation, draw (or describe) an appropriate time series graph, and give the horizontal axis and vertical axis.
(b) In your opinion, what are possible benefits and unfavorable consequences of the sales promotion?
(c) Regarding the sales promotion, does the following statement apply: "overly powerful sales promotions can overshadow the benefits of the brand"
