The Board of Directors for Procter and Gamble Is Concerned

question 61

Essay

The board of directors for Procter and Gamble is concerned that only 19.5% of the people who use toothpaste buy Crest toothpaste. A marketing director suggests that the company invest in a new marketing campaign which will include advertisements and new labeling for the toothpaste. The research department conducts product trials in test markets for one month to determine if the market share increases with new labels.
-Over the trial month the market share in the sample rose to 22% of shoppers. The company's board of directors decided this increase was significant. Now that they have concluded the new marketing campaign works, why might they still choose not to invest in the campaign?

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Definitions:

Binomial Experiment

An experiment or trial that leads to two possible outcomes, often termed success and failure, and follows a binomial distribution.

Identical Trials

Trials in a probability experiment that share the same conditions and possible outcomes.

Success

Achieving a desired outcome or reaching a predefined criterion of performance.