Analytics Take Up from review class

Client: Green Door Vitamins
Channel: Email & DM Website
Expenses: $15/month for 1 year for Constant Contact, Website hosting $240 / yr, $15 domain / yr, $2500 development
Reach: 500 email subscribers, 12000 website views
Reponses: 100 phone calls or emails, 196 clicks, 65 subscribers
Offers redeemed: 68 total, 20 from email only
Average customer: 15 x / year
Average sale: $26
Attrition of customer: 6 years
Offer: Free vitamin C with $10 purchase (vitamin C retail value = $8)
Wholesale price of vitamin C: $5
Pro-rated operating expenses per product: $2
Total sales from customers redeeming the offer: $1015 

CPP (cost per piece)

• ($15x12months) + $240+$15+2500 = $2935 expenses
• 500+12000 = 12,500 pieces sent (equivalent)

$2935/12,500 = 0.24 / CPP

CPR (cost per response)

• $2935 expenses
• 100+196+65 = 361 responses

$2935 / 361 = $8.13 / CPR

CPS/ CPT (cost per sale / transaction)

• $2935 expenses
• 68 sales / redemptions

$2935 / 68 = $43.16 / CPT

Gross Profit (campaign specific)

• 68 (redemptions) x $8 (offer) = $544 lost opportunity cost $544+$2935 = $3,479 total direct campaign expenses
• $10 (terms) x 68 = $680 offer generated revenue

$680 - $3,479 = $-2,799 Gross Loss

Bottom Line Profit (bottom line = can we pay our bills too?)

• $2 x (68 x 2) = $272 prorated operating expenses
  (don’t have # of products so must use # of transactions x 1 for $10 item and 1 for Vitamin C = 2, as an estimation)
• $5 (wholesale of Vitamin C) x 68 = $340 wholesale expense
• $3,479 + $272 + $340 = $4,091 true cost of campaign

$1,015 - $4,091 = $-3,076 Bottom Line Loss

LTV (Lifetime Value)

• 15 x 6 = 90 number of average sales of a customer’s lifetime at store
• 90 x 26 = $2,340 Lifetime revenue potential of an average customer

$2,340 + $43.16 = $2,383.16 LTV of a customer
$2,383.16 x 68 = $162,054.88 LTV of this campaign

ROI (Return on Investment)

• $162,054.88 LTV of campaign - $3,479 total direct campaign expenses

$158,575.88 ROI