New brands with a small market share tend to spend proportionately more for advertising and sales promotion than those with a large market share because:

Question

Quizplus · Accepted Answer

New brands with a small market share need to create awareness of their brand and products in the market, and a certain minimum level of exposure to advertising and promotion is necessary to achieve this. Once a minimum level is reached, further spending may not result in a significant increase in purchase habits. Therefore, new brands tend to spend proportionately more on advertising and sales promotion to achieve the desired level of exposure and create product awareness.

New Brands with a Small Market Share Tend to Spend