Why do many brands with a large market share spend proportionally less on advertising compared to brands with small market share?
A)Beyond a certain volume of promotion, diminishing returns set in.
B)There is no minimum level of exposure for advertising to have an effect on sales.
C)Advertising will not stimulate economic growth for the industry.
D)The firms with large market share do not understand the advertising-to-sales relationship.

Question

Quizplus · Accepted Answer

Brands with a larger market share already have a strong presence and name recognition among consumers, so they can reach a larger audience with less advertising. Additionally, there may be a saturation point where additional advertising does not lead to a significant increase in sales, resulting in diminishing returns on advertising investment.

Why Do Many Brands with a Large Market Share Spend