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Product media advertising and product branding are important in generating the demand for most products. Advertising and branding generally work together to raise the awareness of a product, and in MikesBikes-Advanced, money spent on branding adds to the effectiveness of product advertising.
Advertising a New Product
New products have no awareness, so it is common to invest a significant sum (say $0.5m-$1m) in product advertising to get sales started. Prior investment in the firm's brand will be of assistance here, as it will enhance the awareness generated by product advertising.
Awareness Carryover
It is worth noting that there is a carryover of about 70% of product awareness from the previous period. So, once awareness has been built up, it will require lower levels of brand advertising and product advertising to maintain it.
Sensitivity to Awareness
In deciding the level of investment in advertising, it is important to remember that certain segments are more responsive to advertising than others.
You can find the current information from the reports menu in the single and multi-player, See: Reports ---> Scenario Information ---> Market Segment Scenario Information ---> Product Dimension Sensitivities