What is the average value of a loyal customer (VLC) in a target market segment if the average purchase price is $50 per visit, the frequency of repurchase is every month, the contribution margin is 20 percent, and the average customer defection rate is 27 percent? If a continuous improvement goal is set of a 25 percent defection rate next year and 23 percent two years from now, what are the revised VLCs over their average buying life? Do not round intermediate calculations. Round your answers to the nearest dollar. For defection rate = 27%, VLC = $ _____ For defection rate = 25%, VLC = $ _____ For defection rate = 23%, VLC = $ _____
What is the average value of a loyal customer (VLC) in a target market segment if the average purchase price is $50 per visit, the frequency of repurchase is every month, the contribution margin is 20 percent, and the average customer defection rate is 27 percent? If a continuous improvement goal is set of a 25 percent defection rate next year and 23 percent two years from now, what are the revised VLCs over their average buying life? Do not round intermediate calculations. Round your answers to the nearest dollar. For defection rate = 27%, VLC = $ _____ For defection rate = 25%, VLC = $ _____ For defection rate = 23%, VLC = $ _____
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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What is the average value of a loyal customer (VLC) in a target market segment if the average purchase price is $50 per visit, the frequency of repurchase is every month, the contribution margin is 20 percent, and the average customer defection rate is 27 percent? If a continuous improvement goal is set of a 25 percent defection rate next year and 23 percent two years from now, what are the revised VLCs over their average buying life? Do not round intermediate calculations. Round your answers to the nearest dollar.
For defection rate = 27%, VLC = $ _____
For defection rate = 25%, VLC = $ _____
For defection rate = 23%, VLC = $ _____
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