Case Study $1$:

A company launched a digital marketing campaign with a budget of $\backslash (\backslash$$ $8,000\backslash )$ aimed at acquiring new customers. They managed to acquire $400$ new customers. Calculate the Customer Acquisition Cost $($CAC$).$ Additionally, if each customer on average brings in $\backslash (\backslash$$ $200\backslash )$ in revenue over their lifetime, what is the Customer Lifetime Value $($CLV$)?$ Determine if the campaign is profitable by comparing the CAC to the CLV$.$

$-$ Hint: Divide the total cost of the campaign by the number of new customers to find CAC. For CLV$,$ multiply the average revenue per customer by the number of new customers. Compare CAC to CLV to determine profitability.

Answer:

$-$ CAC Calculation:

$-$ Total Cost of Campaign: $\backslash$$

$-$ Number of New Customers:

$-\backslash (\backslash$quad $\backslash )$ CAC $\backslash (=\backslash )$ Total Cost of Campaign $/$ Number of New Customers

$\backslash (=$: $\backslash )/\backslash (=\backslash$$ $\backslash )$ jer customer.

$-$ CLV Calculation:

Average Revenue per Customer: $\backslash$$

$-$ CLV $=$ Average Revenue per Customer $\backslash (=\backslash$$ $\backslash )$

$-$ Profitability Analysis:

$-$ CLV $(\backslash$$ $)>$ CAC $(\backslash$$ $),$ hence the campaign is $($profitable$/$not profitable$).$ Case Study $2$:

A digital marketing manager is assessing a recent campaign that generated $\backslash (\backslash$$ $50,000\backslash )$ in revenue from $\backslash (\backslash$$ $15,000\backslash )$ spent on advertisements. What is the Return on Ad Spend $($ROAS$)?$ If the target ROAS is $3,$ did the campaign meet the target?

$-$ Hint: Divide the total revenue generated by the cost of advertisements to find ROAS. Compare the calculated ROAS to the target ROAS.

Answer:

$-$ ROAS Calculation:

$-$ Revenue Generated: $\backslash$$

$-$ Cost of Advertisements: $\backslash (\backslash$$ $\backslash )$

$-$ ROAS $\backslash (=\backslash )$ Revenue $\backslash (/\backslash )$ Cost of Ads

$\backslash (=\backslash$$ $\backslash )/\backslash$$ $\backslash (=\backslash )$

$-$ Target Comparison:

$-$ Actual ROAS $\backslash (1>\backslash )$ Target ROAS $),$ hence the campaign the target. $($met or not met$)$ Case Study $3$:

An online retailer tracked their ad performance and found that out of $15,000$ impressions, they received $300$ clicks. Calculate the Click$-$Through Rate $($CTR$).$ Additionally, if $\backslash (25\backslash \%\backslash )$ of those who clicked made a purchase, what is the Conversion Rate?

$-$ Hint: Divide the number of clicks by the number of impressions and multiply by $100$ to find CTR$.$ To find the conversion rate, calculate the percentage of clicks that resulted in purchases.

Answer:

$-$ CTR Calculation:

$-$ Number of Impressions:

$-$ Number of Clicks:

$-\backslash (\backslash$quad $\backslash )$ CTR $\backslash (=\backslash )($Number of Clicks $/$ Number of Impressions$)*100$

$\backslash (0=\backslash ))*\backslash (100=\backslash )\backslash (\backslash \%\backslash )$

$-$ Conversion Rate Calculation:

$-$ Number of Conversions $\backslash (=25\backslash \%\backslash )$ of $\backslash (=\backslash )$

$-$ Conversion Rate $\backslash (=(\backslash )$ Number of Conversions $\backslash (/\backslash )$ Number of Clicks $\backslash ()*100=\backslash ))*\backslash (100=\backslash )\backslash (\backslash \%\backslash )$ Case Study $4$:

A company's marketing efforts generated $20,000$ website visitors. Out of these visitors, $2,000$ added products to their cart, and $500$ completed the purchase. Calculate the Add$-$to$-$Cart Rate and the Conversion Rate from visitors to customers.

$-$ Hint: Divide the number of add$-$to$-$cart actions by the number of website visitors and multiply by $100$ to find the add$-$to$-$cart rate. To find the conversion rate, divide the number of purchases by the number of visitors and multiply by $100.$

Answer:

$-$ Add$-$to$-$Cart Rate Calculation:

$-$ Number of Website Visitors:

$-$ Number of Add$-$to$-$Cart Actions:

$-$ Add$-$to$-$Cart Rate $\backslash (=(\backslash )$ Number of Add$-$to$-$Cart Actions $\backslash (/\backslash )$ Number of Website Visitors $\backslash ()*100\backslash )\backslash (=(\backslash )/\backslash (\backslash$quad $*100=\backslash )\backslash (\backslash \%\backslash )$

$-$ Conversion Rate Calculation:

$-$ Number of Purchases:

$-$ Conversion Rate $\backslash (=(\backslash )$ Number of Purchases $\backslash (/\backslash )$ Number of Website Visitors $\backslash ()*100=\backslash )\backslash (/\backslash ))*\backslash (100=\backslash )\backslash (\backslash \%\backslash )$ Case Study $5$:

A company reduced its average Customer Acquisition Cost $($CAC$)$ from $\backslash (\backslash$$ $50\backslash )$ to $\backslash (\backslash$$ $40\backslash )$ by optimizing their ad targeting. If they acquired $1,000$ new customers, calculate the total savings. Additionally, if each customer has a Customer Lifetime Value $($CLV$)$ of $\backslash (\backslash$$ $200\backslash ),$ how much profit did the company make from these $1,000$ new customers?

$-$ Hint: Subtract the reduced CAC from the initial CAC and multiply by the number of new customers to find total savings. To find profit, subtract the reduced CAC from CLV and multiply by the number of new customers.

Answer:

$-$ Total Savings Calculation:

$-$ Initial CAC: $\backslash$$

$-$ Reduced CAC: $\backslash$$

$-$ Savings per Customer $=$ Initial CAC $-$ Reduced CAC

$=\backslash$$ $-\backslash$$ $\backslash (=\backslash$$ $\backslash )$

$-$ Total Savings $=$ Savings per Customer $*$ Number of New Customers

$\backslash (=\backslash$$ $\backslash )*=\backslash$$

$-$ Profit Calculation:

$-$ CLV per Customer: $\backslash (\backslash$$ $\backslash )$

$-$ Profit per Customer $=$ CLV $-$ Reduced CAC

$\backslash (=\backslash$$ $\backslash )-\backslash$$ $\backslash (=\backslash$$ $\backslash )$

$-$ Total Profit $\backslash (=\backslash )$ Profit per Customer $*$ Number of New Customers $\backslash (=\backslash )$

$\backslash (\backslash$$ $\backslash )*\backslash (1,000=\backslash$$ $\backslash )$