Pepsi and Coke both have reached the point that investing more dollars in advertising yields lower and lower increases in sales.The model used to illustrate this concept is:

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The sales-response function curve model is used to show the point at which additional advertising spending no longer results in a proportional increase in sales. This is also known as the point of diminishing returns. This concept is applicable to both Pepsi and Coke as they have both reached a point of saturation in the market where additional advertising spending will not produce much impact on sales.

Pepsi and Coke Both Have Reached the Point That Investing