The calculation for % response rate in direct marketing is (10 points): ___ a) a
ID: 382520 • Letter: T
Question
The calculation for % response rate in direct marketing is (10 points):
___ a) audience targeted / # of responses
___ b) audience targeted * # of responses
___ c) # of responses / audience targeted
(audience targeted = names ordered, impressions, etc.)
You are projecting that your cost-per-click campaign will have 100,000 impressions, a click through rate of .05%, a cost-per-click of $1.00 and a conversion rate of 10%. The average order is $20. Compute the following (20 points):
Total orders _________
Cost per acquisition _________
Cost per click _________
ROI % _________
Show your work here! You may get partial credit.
Explanation / Answer
Total Impression - 100000
Click trhough rate - .05%
Total clicks - 50
Total cost - 50x$1 = $50
Total conversion - 50x10% = 5
Average order - $20
Total Order - 5x$20 = $100
Cost per acquisition - $5
Cost per click - $1
ROI % - $100 - $5 = $95
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