Calculate the total fixed costs of operating the Exchange Tower store. If the Exchange Tower store were to close down, Piltz would spend 15% of the total cash fixed costs of the Exchange Tower store towards financing partnerships with micro-influencers on Instagram. How much would be used on influencer marketing if the Exchange Tower store shut down?
 
 

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Given the nature of the economy and the continued closure of Thursdays Exchange Tower location, Piltz wondered whether closing this store permanently would be a strategic way to generate additional funds to put toward online advertising. If the Exchange Tower store were to close. Piltz planned to use 15 per cent of the store's annual recurring cash costs to finance partnerships with micro-influencers on Instagram (see Exhibit 2). Micro-influencers that is, Instagram influencers who had between 1,000 and 100,000 followers were known to have the highest engagement rates of all influencer types.24 Using the influencer budget, Piltz was willing to offer participating micro-influencers $1,500 each to recommend Thursdays to their respective followers in the form of a sponsored post. Piltz would also provide each influencer $150 worth of merchandise to wear when creating their posts. Additional details of the partnerships were to be determined at a later date. Piltz planned to offer this partnership opportunity only to influencers with an average of 50,000 followers. To ensure a wide geographic reach, Piltz would hand- select influencers from a variety of different cities across Canada and parts of the United States. Given the nature of the economy and the continued closure of Thursdays Exchange Tower location, Piltz wondered whether closing this store permanently would be a strategic way to generate additional funds to put toward online advertising. If the Exchange Tower store were to close. Piltz planned to use 15 per cent of the store's annual recurring cash costs to finance partnerships with micro-influencers on Instagram (see Exhibit 2). Micro-influencers that is, Instagram influencers who had between 1,000 and 100,000 followers were known to have the highest engagement rates of all influencer types.24 Using the influencer budget, Piltz was willing to offer participating micro-influencers $1,500 each to recommend Thursdays to their respective followers in the form of a sponsored post. Piltz would also provide each influencer $150 worth of merchandise to wear when creating their posts. Additional details of the partnerships were to be determined at a later date. Piltz planned to offer this partnership opportunity only to influencers with an average of 50,000 followers. To ensure a wide geographic reach, Piltz would hand- select influencers from a variety of different cities across Canada and parts of the United States.

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