Marketing midterm 2 equations

conversion rate

conversions / clicks

roi

(gross margin - expenditure) / expenditure

gross rating points

frequency * reach

contribution margin

(price - var cost) / price

contribution per unit

unit cost - unit var cost

click through rate

clicks / impressions

BEP dollar volume

total fixed costs / contribution margin

Objective and task budget

sum(all costs to achieve objectives)

BEP units

total fixed costs / contribution per unit

costs per transaction

expenditure / transactions

cost per click

expenditure / clicks

profit

(transactions * margin) - expenditure

BEP price

total fixed cost / forecasted qty + var cost per unit

comp-parity

CP * (1+difference)

Price elasticity of demand

% change in qty / % change in price

Elasticity is infinite

demand curve horizontal

Elasticity is 0

demand curve is vertical

cross price

% change in qty good A / % change in price good B

negative cross price

complement

zero cross price

independent

positive cross price

substitute

Cost + markup

Avg unit cost * (1+markup %)

Customer Lifetime Value

Customer margin - cost of serving customer

customer life expectancy

1 / 1-customer retention rate

Revenue

Price * total subscriber base

Segment size post usage

Segment size % * estimated retention rate

Usage based pricing model

total subscriber base * segment size post usage * price

Incremental revenue usage based pricing

usage based revenue - subscription based revenue