Chat with us, powered by LiveChat Great Gator Gifts (GGG) launched a Touchdown Club, where Gator fans can create a wish list?? of Gator items.? Every year, at the beginning of football season, GGG sends a link to the spou | EssayAbode

## 20 Nov Great Gator Gifts (GGG) launched a Touchdown Club, where Gator fans can create a wish list?? of Gator items.? Every year, at the beginning of football season, GGG sends a link to the spou

Great Gator Gifts (GGG) launched a Touchdown Club, where Gator fans can create a “wish list” of Gator items.  Every year, at the beginning of football season, GGG sends a link to the spouse of each member of the Touchdown Club with a reminder to kick the season off with a special Gator gift.  GGG attracted new customers at a cost of \$25.00 each and tracked their purchases over a 4-year period.  The average annual purchase was \$500.00, with a gross margin of 60% and annual per capita marketing expense of \$50.00.  GGG uses a discount rate of 8%, and the observed annual retention rate of Touchdown Club members was 50%.  What was GGG’s 4-year CLV?

Please complete and correct if necessary the Excel file.

## Sheet1

 Data Given New Customers ?? Acquisition Cost/customer \$25 Revenue/customer \$500 Gross Margin % 60% Mktg Exp Per Capita \$50 Discount Rate 8% Retention Rate 50% Time 4 Years Year 1 2 3 4 Total Revenue 500 500 500 500 COGS 200 200 200 200 Gross Maring % 60% 60% 60% 60% Contribution 300 300 300 300 Marketing Expense 50 50 50 50 Cash Flow 250 250 250 250 Discount Rate Retention Rate (zero @ Y1 Expected NPV Cumulative NPV 25 Acquisition Cost CLV

Computational Formula C = Cash Flow d = Discount rate t = Time period r = Retention probability A = Acquisition cost

## image1.png

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Great Gator Gifts (GGG) launched a Touchdown Club, where Gator fans can create a “wish list” of Gator items. Every year, at the beginning of football season, GGG sends a link to the spouse of each member of the Touchdown Club with a reminder to kick the season off with a special Gator gift. GGG attracted new customers at a cost of \$25.00 each and tracked their purchases over a 4-year period. The average annual purchase was \$500.00, with a gross margin of 60% and annual per capita marketing expense of \$50.00. GGG uses a discount rate of 8%, and the observed annual retention rate of Touchdown Club members was 50%. What was GGG’s 4-year CLV?

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