Radcliff Maru Case Answers
Candace Radcliff
Maru Case Answers
1. What is the customer acquisition cost to Maru Batting Center for the following customers?
a. A little leaguer = 10,000
b. A summer slugger= 10,000
C. An elite ballplayer is MBC places the ad in the local baseball enthusiasts magazine= 60,000
d. An elite ballplayer is MBC purchases the list and invites all target customers to the gala event= 50,000
e. An entertainment seeker = 2,000
2. Without discounting cash flows to take into account the time value of money, how soon will MBC break even on the following customers? In all cases, assume that revenues and variable costs to staff the cages occur on an outgoing basis but that the acquisition costs are a one-time event.
a. A little leaguer = year 3
b. A summer slugger = year 3
C. An elite ballplayer is MBC places the ad in the local baseball enthusiast’s magazine= year 4
d. An elite ballplayer is MBC purchases the list and invites all target customers to the gala event= year 3
e. An entertainment seeker= year 2
3. Taking into account the time value of money and assuming that 100 percent of a customer segment will have experienced attrition once the net present value of annual profits per customer falls below 100, what is the lifetime value to MBC of the following customers?
a. A little leaguer= 5,556
b. A summer slugger= 956
C. An elite ballplayer is MBC places the ad in the local baseball enthusiast’s magazine= 5,916
d. An elite ballplayer is MBC purchases the list and invites all target customers to the gala event= 15,916 i. Should MBC throw the gala event? Yes because it shows the highest earning
e. An entertainment seeker = 117
4. Which is the most attractive customer segment for MBC to target? Explain your reasoning.
Elite ballplayers are the most attractive customer segment for MBC to target even though they have high acquisition costs because their purchase is big and buys the product frequently. They are able to charge this group a higher price. Also little leaguers
Maru Case Answers
1. What is the customer acquisition cost to Maru Batting Center for the following customers?
a. A little leaguer = 10,000
b. A summer slugger= 10,000
C. An elite ballplayer is MBC places the ad in the local baseball enthusiasts magazine= 60,000
d. An elite ballplayer is MBC purchases the list and invites all target customers to the gala event= 50,000
e. An entertainment seeker = 2,000
2. Without discounting cash flows to take into account the time value of money, how soon will MBC break even on the following customers? In all cases, assume that revenues and variable costs to staff the cages occur on an outgoing basis but that the acquisition costs are a one-time event.
a. A little leaguer = year 3
b. A summer slugger = year 3
C. An elite ballplayer is MBC places the ad in the local baseball enthusiast’s magazine= year 4
d. An elite ballplayer is MBC purchases the list and invites all target customers to the gala event= year 3
e. An entertainment seeker= year 2
3. Taking into account the time value of money and assuming that 100 percent of a customer segment will have experienced attrition once the net present value of annual profits per customer falls below 100, what is the lifetime value to MBC of the following customers?
a. A little leaguer= 5,556
b. A summer slugger= 956
C. An elite ballplayer is MBC places the ad in the local baseball enthusiast’s magazine= 5,916
d. An elite ballplayer is MBC purchases the list and invites all target customers to the gala event= 15,916 i. Should MBC throw the gala event? Yes because it shows the highest earning
e. An entertainment seeker = 117
4. Which is the most attractive customer segment for MBC to target? Explain your reasoning.
Elite ballplayers are the most attractive customer segment for MBC to target even though they have high acquisition costs because their purchase is big and buys the product frequently. They are able to charge this group a higher price. Also little leaguers