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

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?  

https://warrington.video.ufl.edu/Mediasite/Play/0823104c2dc74f8cac525e9872a3bfea1d

https://warrington.video.ufl.edu/Mediasite/Play/ad0ded7acb0e456aa6d1f07e846a27bb1d

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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