Question

Shay Culpepper, and her team, was bired to project financial revervaes for a startup that aues sulbncription revenue model. She assigned her team to collect some basic information anvd this is what they came sup with. Alexey he could s and pay S10/month. Using this information, Alexey wants to ran some marketing experiment and found out that if Ine spent $200 on Coogle Adwords, up 6 new customers. On an average, each custonser expected to use the app for 24 months Channel Total Spend Cosucikk ← calculate the following information. Hel ļf the startup had a marketing budget of siooo for year I-what is its forecasted reven er what's the revenue for years 2 &3 Marketing Bud Forecasted revenue Marta Pallares similarly wanted to know cost of customer acquisition (CCA) and projected revenue, if the startup used Facebook and other social networks, and this is what she came up with. Help her complete the missing information. Channel Spend Cost/Click Signups Conversion Rate CCA | Adwords.TS20000tーーs1.00 tー -6 Facebook $200,00 S0.50 12 Twitter S200.00 LinkedIn $200.00 Average 5800.00 YearYear 2 Year3 Marketing Budget $10.000 Forecasted revenue Zhan Wang wondered if the startup could find an extermal investor to fund a major marketing cmpaign. what would be its forecasted revenue? Year Year 2 Year 3 Marketing Budget $50,000 $800,000 S1,000,000 Forecasted revenue Stephanie Gregory is worried that experiment may actually be exaggerating signup rates. She wants to see what happens if signup rates are lower than projected A. Spend Cost/Click Signups Conversion Rate C Channel Adwords Facebook S20 Twitter LinkedIn AverageYear l $200.00 $200.00 $200.00 $200.00 0.00 $1.00 S0.50 S0.75 $4.00 Year Year 3 Marketing Budget 550,000丨 $800,000 1 $1,000,000 t the same time, Kevin Navarra wondered if they could somehow improve the signup rate by better Forecasted revenue targeting customers, how would it impact the projected revenue? | Adwo aceboo $200.00 .00 800 00 Marketing Budget Foreeasted revenu Advait Apte wants to know the effect of increase in advertisement rates on forecasted revenue Spend Cost/Click Signups Conversion Rate CCA Adwords 50 1.00 200.00 Linkedln Averagear Year 2 Year 3 Forecasted revenue Nafiul Prodhan the revenue: wants to know if personal visits and telephone calls would be more effective at increasing Spend Cost/unit Signups Conversion Rate CCA 20 Personal visits S500.00 Telephone calls SS0000 $1,00 I 20 Average 100.00 $1,000.00 Year Year2 Year 3 $50,000 $800,000 $1,000,000 Marketing Budget Forecasted revenue Finally, Aliaksandra Viarbitskaya and Shay Culpepper sit down to analyze the strategy that they should recommend to the startup founders. What channel/ mix of channels should the startup use to maximize its projected revenue?

Answer 1

With Respect to Alexey:-

Conversion rate 7.2/ $ marketing expenses

Cost of customer acquisition $200

Forecasted Revenue:Year 1=$7200, Year 2=3$6000 and year 3=$72000