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City Pizza has opened a new store in Kitchener. They have decided to operate a...

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Accounting

City Pizza has opened a new store in Kitchener. They have decided to operate a promotional campaign with total ad costs of $26, 500. The ad will offer a link to sign up for a special discount when they sign up for email offers and they hope to add 500 emails to their customer database. City Pizza knows that the average customer will remain in the area for 3.5 years and spends an average of $25.33 per month. City Pizza has a gross profit margin of 15%. Please calculate the simple and complex CLV for City Pizza at this location. Please reply to this thread with both CLV calculations. In addition, please calculate the potential revenue if 50% of the emails become a customer. Using return on ad spend, do you feel that this campaign has the potential to generate enough revenue to meet the industry standard of 4:1 ROAS? Do you feel this is a smart campaign for City Pizza? After posting your reply, please take a few moments to read and reply to your peers.

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