In 2020, XYZ Auto Insurance ran a marketing campaign to boost its customer pool from 100,000 to 105,000 customers, using
Posted: Fri May 20, 2022 8:29 am
In 2020, XYZ Auto Insurance ran a marketing campaign to boost
its customer pool from 100,000 to 105,000 customers, using a series
of commercials on local TV networks and mailing to its prospective
100,000 customers. The company allocated $1,000,000 as the
campaign’s budget but ended up spending $1,200,000 in 2020.
However, the company was only able to gain 3,000 new customers. On
the other hand, the company lost 250 customers every month during
the same period. At the same time, XYZ increased its annual
customer maintenance budget by $1,000,000 to $5,000,000 to improve
customer care for its existing customers. A newly acquired
customer’s average annual insurance premium is roughly $350 per
year, and the average interest rate that XYZ pays to its primary
bank, Delta, is 5%.
its customer pool from 100,000 to 105,000 customers, using a series
of commercials on local TV networks and mailing to its prospective
100,000 customers. The company allocated $1,000,000 as the
campaign’s budget but ended up spending $1,200,000 in 2020.
However, the company was only able to gain 3,000 new customers. On
the other hand, the company lost 250 customers every month during
the same period. At the same time, XYZ increased its annual
customer maintenance budget by $1,000,000 to $5,000,000 to improve
customer care for its existing customers. A newly acquired
customer’s average annual insurance premium is roughly $350 per
year, and the average interest rate that XYZ pays to its primary
bank, Delta, is 5%.