Dypers

The Drypers Corporation should invest $10,000,000 in national television advertising in 1998 since this is something we have never done before. The exposure that this television campaign will bring will help to increase sales in the United States and also increase the profitability of the entire company. It will help to increase brand awareness, recognition and loyalty for the Drypers brand. We will also be able to increase our market share of 3.1% in the total market.

With the television campaign, Drypers will need a 17% increase in revenue to break-even. The national television campaign will improve the profitability of our company. Revenue increased by 16% from 1996 to 1997. I think this is a practicable increase in revenue considering it is only a 1% improvement from the 1996 to 1997 increase. Advertising expenses in 1997 were $3,219,000 and the company was also registering its strongest year in terms of sales and profitability in 1997. By spending $6,781,000 more than in 1997, we can get our name out there and increase our brand awareness. If we implement the television campaign, 1998 will become our strongest year for the profitability of the company.

Brand awareness for the Drypers brand should increase since we have never advertised on television before. Our major competitors, Proctor & Gamble and Kimberly-Clark, have been advertising on television and are very successful. This television campaign is a step in the right direction to be able to compete with our major competitors more successfully. Consumers who have been settling for low quality diapers will see our advertisement and most likely switch to our brand which has a high quality for a low price. We have a very distinct brand of diapers and we possess a lot of product innovation. This is very valuable to us since we have something the competitor does not have. Research has shown that one baby is equal to $1,125 in revenue. As a company we would need to have