A new brand of Blue Dog Beer is being offered on the market, with a distribution coverage rate (ACV%) of 80%. Two customer segments can be distinguished based on their usage rates. There are 35 million heavy beer drinkers, with 70% projected awareness for the new Blue Dog Beer, an estimated trial rate of 40% (average trial units = two packs), a repeat purchase rate of 10%, with an average of 5 repeat purchases (one pack each) per year. There are 100 million moderate beer drinkers, with 40% projected awareness for the new Blue Dog Beer, an estimated trial rate of 15% (average trial units = one pack), a repeat purchase rate of 5%, with an average of 2 repeat purchases (one pack each) per year.
1. What total first year volume (in packs) do you predict for the heavy beer drinker segment for the new Blue Dog Beer?
2. What total first year volume (in packs) do you predict for the moderate beer drinker segment for the new Blue Dog Beer?
3. If the marketing strategy is to focus only on one of these two segments, which segment would you recommend, and why?