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# Analytical: should we launch, pilot first, or hold?
Launch the new product?
Launch nationally
(cost 50000)
# full marketing budget
Strong demand
(p 0.4)
: 200000
Weak demand
(p 0.6)
: 20000
Pilot in one city first
(cost 15000)
Pilot succeeds
(p 0.5)
Roll out nationally
(cost 45000)
Strong demand
(p 0.7)
: 200000
Weak demand
(p 0.3)
: 20000
Stop after pilot
: 0
Pilot fails
(p 0.5)
Roll out anyway
(cost 45000)
Strong demand
(p 0.1)
: 200000
Weak demand
(p 0.9)
: 20000
Stop after pilot
: 0
Don't launch
: 0
# Analytical: should we launch, pilot first, or hold? Launch the new product? Launch nationally (cost 50000) # full marketing budget Strong demand (p 0.4): 200000 Weak demand (p 0.6): 20000 Pilot in one city first (cost 15000) Pilot succeeds (p 0.5) Roll out nationally (cost 45000) Strong demand (p 0.7): 200000 Weak demand (p 0.3): 20000 Stop after pilot: 0 Pilot fails (p 0.5) Roll out anyway (cost 45000) Strong demand (p 0.1): 200000 Weak demand (p 0.9): 20000 Stop after pilot: 0 Don't launch: 0
The tree checks out.
Best option
Launch nationally
Expected value
42,000
·
6,500
ahead of Pilot in one city first
Analysis
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