Cost Benefit Analysis
Cost-Benefit-Analysis.
In order to choose the best strategy that leads to our business goal, we ha have conducted Cost-Benefit-Analysis on the offering of Freemium account to potential customers to attract them and lead to buy the Premium Service. We had in mind that searching for and getting new customers for the business is expensive and beneficial. So we decided to invest on building a lasting and profitable business customer base, and instill trust into customers by offering an exceptional customer service which would give us a competitive advantage.
We assumed that only freemium account services users will account for 40% of our total customers and use up 30% of our resources (Total cost) while the rest, after trial, will buy Premium Account. For those remain on using only Freemium account services, we have introduced other revenue streams to exploit, capture the value we created, and generate revenue from them. We have two more revenues streams such as advertizing and second hand market services. After closely investigating we became convinced their returns are remarkably higher than their cost, so that we offer FREEMIUM ACCOUNT SERVICES.
Market Segmentation and our business typical customer
Basic variables that divide the market into segments are:-
1-Customer needs: It is the most important criteria to segment the market. Market research is conducted to identify customers’ needs. Regarding to our customers’ need, we have identified them in our VOC process, and
2-Customer profile.
The typical customers for our business are all students at all universities in Sweden. Thus their profile would be:-
Age: Mostly between 20-30 year old
Nationality: Diverse with Swedish majority
Income: Monthly around 10,000 Kr as a student financial aid paid by CSN authority.
Sex: Both male and female
Social Class: Students
Life style: Mostly single using excessively dating and social media, looking for a company to enjoy with and to disguise loneliness.
Measuring Market Size.
In order to choose the best strategy that leads to our business goal, we ha have conducted Cost-Benefit-Analysis on the offering of Freemium account to potential customers to attract them and lead to buy the Premium Service. We had in mind that searching for and getting new customers for the business is expensive and beneficial. So we decided to invest on building a lasting and profitable business customer base, and instill trust into customers by offering an exceptional customer service which would give us a competitive advantage.
We assumed that only freemium account services users will account for 40% of our total customers and use up 30% of our resources (Total cost) while the rest, after trial, will buy Premium Account. For those remain on using only Freemium account services, we have introduced other revenue streams to exploit, capture the value we created, and generate revenue from them. We have two more revenues streams such as advertizing and second hand market services. After closely investigating we became convinced their returns are remarkably higher than their cost, so that we offer FREEMIUM ACCOUNT SERVICES.
Market Segmentation and our business typical customer
Basic variables that divide the market into segments are:-
1-Customer needs: It is the most important criteria to segment the market. Market research is conducted to identify customers’ needs. Regarding to our customers’ need, we have identified them in our VOC process, and
2-Customer profile.
The typical customers for our business are all students at all universities in Sweden. Thus their profile would be:-
Age: Mostly between 20-30 year old
Nationality: Diverse with Swedish majority
Income: Monthly around 10,000 Kr as a student financial aid paid by CSN authority.
Sex: Both male and female
Social Class: Students
Life style: Mostly single using excessively dating and social media, looking for a company to enjoy with and to disguise loneliness.
Measuring Market Size.