Demand_Problem

Topics: Economics terminology, Marketing, Market Pages: 1 (547 words) Published: November 1, 2014

How big is the potential market (in consumers, units, and dollars) for salty snacks?
The total potential market in consumers is 150 MM; in units is 1,365 MM and in dollars US$ 4,021.35 million. What is the market penetration of pita chips?
For calculated the market penetration we are going to consider the number of pita chip consumers and the total number of consumers in the potential market (snack market).
Market penetration index: Market Demand (MM) = 20 = 13% # of consumers in potencial market (MM)   150    
Based on these answers, how much growth potential is there for a company like Stacy's? As we can see the market penetration of pita chips is low (13%). Therefore, a Company that is part of this market, as Stacy's Pita Chip, can grow because many potential customers are not buying any of the brands. It can take a big part of the market that hasn´t been realized yet. QUESTION 2

What is the market penetration of pita chips in the three target markets? Which one offers the most untapped potential for Stacy's?
The lowest market penetration index is 0.02 for light consumers. Hence, of the three target markets this offers a great potencial to grow for Stacy's. In general, the market penetration index in the three target markets are low so Stacy’s can apply different strategies to increase its presence in the market of snacks. However, there are other elements to consider as the market share, in units and in sales; to make a complete analysis of the expansion opportunities for this brand. QUESTION 3

Looking at the current market for pita chips, what percentage of the business is driven by heavy users, moderate users, and light users?

If we make the analysis by units, heavy users represent the 54% of the pita chips market, moderate the 45% and light 1%. However, for sales the moderate consumers are the most representative with a 58%, follow by heavy with 40% and light with 2%. The variation...
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