A catalogue marketer mails out catalogues 4 times/year. The company groups its customers into two segments: premier and regular. There currently are 40,000 premier and 60,000 regular customers. The contribution margins of the two segments are $100 and $75, respectively (per year). The retention rates of premier and regular customers are 60% and 50%, respectively (per year). Acquiring new names to mail catalogues to costs $5/valid name and address. About 5% of new acquired names that have catalogs mailed to them convert to customers over the course of a year’s (4) mailings, falling into each spending segment in the same ratio as their current customers. The marginal cost of printing and mailing each catalog is $ 2.50/customer/catalog. The firm’s discount rate is 5%.

Which of the following actions would turn the average CLV positive?

$ 166.67

$ 166.67

$ 133.33

$ 300.00

Answer rating: 100% (QA)

Answer Summanized the data and fntormation fnthe questf i coctalogue ... View the full answer