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0 pointscom2kid7y ago0 comments

You are assuming the ads don't have any impact on where Steve goes to buy.

In reality what happens is marketing runs an ad for $3000 offering a $1000 incentive, Steve makes the purchase, and making gets to (possibly correctly) claim they netted $1000 in sales.

Those marketing people want to keep their jobs, so they are going to work hard to justify their existence!

0 comments

AnthonyMouse7y ago

> You are assuming the ads don't have any impact on where Steve goes to buy.

No, I am assuming that advertising works the same for everyone. If there are five dealers and fifty customers and with no advertising each dealer gets ten customers, then with each dealer spending $50,000 on targeted advertising, each dealer still gets ten customers. When each dealer spends the same amount they each get the same benefit, so they still split the existing customers five ways.

misterprime7y ago

What if two dealers spend a total of $20,000 and the other three don't spend anything?

Where are the customers gonna end up?

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