Retravision plans to spend $100,000 on an advertisement on a new air conditioner reaching 200,000 catalogue...
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Retravision plans to spend $100,000 on an advertisement on a new air conditioner reaching 200,000 catalogue readers. Retravision expects the ad to convince 2.5% of the readers to take advantage of this introductory offer (which is priced so low that Retravision makes only a $15 margin on this initial purchase) and the customer lifetime value (CLV) of the acquired customers is $150. What is the prospect lifetime value and is the advertisement economically attractive? Retravision plans to spend $100,000 on an advertisement on a new air conditioner reaching 200,000 catalogue readers. Retravision expects the ad to convince 2.5% of the readers to take advantage of this introductory offer (which is priced so low that Retravision makes only a $15 margin on this initial purchase) and the customer lifetime value (CLV) of the acquired customers is $150. What is the prospect lifetime value and is the advertisement economically attractive?
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Managerial Accounting
ISBN: 978-1259307416
16th edition
Authors: Ray Garrison, Eric Noreen, Peter Brewer
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