In this simulation, you will need to calculate the CLVs and CACs for your Customer Segments and Target Customer Segments. Calculating the CLV to CAC ratio will help you identify the most profitable segments.
- CLV = Average revenue per customer per period x Average customer relationship length
- CAC = All costs spent to acquire customers in a period / Number of customers acquired in the period
You'll use the information downloaded from the Round to enter into this portion of the simulation. It will tell you above this section what data you're reviewing for these calculations. You'll want to keep a special eye out for the time you're entering into the simulation and the time listed on the spreadsheet for the average customer relationship length.
If you're having any trouble with your calculations, we recommend double-checking the time on the spreadsheets vs. what the simulation is asking for.
When calculating the Average revenue per customer per period, definitely don't overcomplicate it. When you download the Customer Product Purchase data in Round 3, you'll want to average the revenue for the product you're calculating for. It's up to you on how you would like to average that data and it's different on each program you use to calculate that data. You may reach out to your instructor if you are having trouble calculating that data. They may have a preferred method they would like you to use to calculate it.
While the Stukent team is happy to assist with technical support, we are not marketing experts. Generally, questions about best practices with Marketing Management should be directed back to your course instructor for the best guidance.
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