Zoecon’s introduction of the Strike Roach Ender has captured a substantial portion of the test area household market segment. As seen in Table A the brand was recognized by over half of the households in the market and 6 %,( 70,200 households) of those households purchased the brand, resulting in a profit of $ 247,180.40. Though repeat purchases were also high at 30% (21,060 households) the profit generated was not enough to sustain a revenue in the trial market. Zoecon ended the market in a net loss of $$1,230,819.40. Figures are further broken down in Table A.
Contribution margins were also high for Strike Roach Ender. Aerosol Strike had a contribution margin of 55.1% and fogger had an even higher margin of 57% as seen in Table B.
Table C projects the break even analysis in both units and dollars as a basis for further projections. As seen in Table C substantially larger sales are required to break even.
Industry Market Analysis
Using the techniques from the test market estimates of market share and projected sales for the 19 city (80% of trial insecticide volume) are made for the introduction of Strike Roach Ender into the household market. I also chose to increase the advertising budget by 20% which increased costs to upwards of $12 million. This further drove the net loss to a final projection of $6,844,476 as seen in Table D.
Much like the test market Contribution margins were also high for Strike Roach Ender. Aerosol and fogger Strike had a contribution margin exceeding 50% as seen in Table E.
Table F projects the break even analysis in both units and dollars as a basis for further projections.