Chester\'s Elite product Coat has an awareness of 72%. Chester\'s Coat product m

Question

Chester's Elite product Coat has an awareness of 72%. Chester's Coat product manager for the Elite segment is determined to have more awareness for Coat than Andrews' Elite product Aft. She knows that the first $1M in promotion generates 22% new awareness, the second million adds 23% more and the third million adds another 5%. She also knows one-third of Coat's existing awareness is lost every year. Assuming that Aft's awareness stays the same next year (77%), out of the promotion budgets below, what is the minimum Chester's Elite product manager should spend in promotion to earn more awareness than Andrews' Aft product?

Explanation / Answer

Determine the minimum Chester's Elite product manager should spend in promotion to earn more awareness than Andrews' Aft product:

First $1M in promotion generates 22% new awareness

Aft's awareness stays the same next year is 77%

Chester’s Elite product manager should spend $2M in promotion to earn more awareness than Andrews’ Aft product.

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