sales and marketing mainly consisted of catalog production and mailing ($0.32 per catalog) mailing list rental (0.08 per name) freight out (9 per order), and order processing and fulfilllment ($5 per order).

In fiscal year 1991 100 000 prior customers received one catalog per month, which provided 60 000 orders. The balance of the 12 055 000 catalogs mailed in fiscal year 1991were 7 855 000 rented mailing list names response rates varie significantly. Prior customer mailing yielded 5%-10%, while recipient and mailing list names only yielded 1-2%

Minneapolis/St paul

Population 3 610 7000

HOusehold 1 352 4000

This campaign was planned, if lasted 12 months, to at least double the annual FTD advertising budget of 21Cents per household

What is the acquisition cost of C&C customer acquired using catalogs? What should be the minimum response rate of the Minneapolis Promotional Campaign for the acquisition cost to be lower?