A local dental practice decides to run a Groupon campaign. The campaign offered $345 worth of dental
Question:
A local dental practice decides to run a Groupon campaign. The campaign offered $345 worth of dental services (such as teeth whitening) for $150. For the total campaign, 265 coupons were sold. We estimate that 85% of the coupons will be redeemed, that 35% of the coupons will be redeemed by existing customers and that, on average, Groupon customers purchased 1.5 coupons. Let’s assume that 22% of new customers come back after the Groupon coupon visit. The dental practice estimates its cost of goods sold to be 60%. Finally, the bill for the average Groupon customer was $395. The dental practice negotiated a 50/50 split with Groupon.
Calculate the Groupon campaign profit/loss (+/-).
Systems analysis and design
ISBN: 978-0136089162
8th Edition
Authors: kenneth e. kendall, julie e. kendall