380 likes | 584 Views
Measuring the ROI of Inbound Marketing. Presented by: Gabe Wahhab. President – Savvy Panda. @ gabewahhab @ savvypanda. Hi!. Your Expectations. More Traffic. More Leads. More Sales. Lower Cost. The Goal for Today. Cost of Customer Acquisition. COCA.
E N D
Measuring the ROI of Inbound Marketing Presented by: Gabe Wahhab President – Savvy Panda @gabewahhab @savvypanda
Cost of Customer Acquisition COCA Cost to Acquire Customer CAC
Calculating COCA Ex. Startup SaaS Company Over 1 YearMarketing Salaries - $45,000Marketing Expenditures – $45,000Sales Salaries - $68,000Sales Expenditures - $2,000Total Cost – $160,000Customers Acquired – 40 COCA = 160,000 / 40 = $4,000
Life Time Value LTV
Calculating LTV Ex. Startup SaaS Company Over 1 YearAvg Customer Yearly Revenue - $12,000Profit Margin – 80% Avg Yearly Churn - 33% (aka 3 years)LTV = ($12,000 * .80) * (1 / 0.33)LTV = ($9,600) * (3) = $28,800 LTV = $28,800
COCA:LTV Ratio Ex. Startup SaaS Company Over 1 YearCOCA = $4,000 LTV = $28,800COCA:LTV Ratio $28,800 / $4,000 = 7.2 COCA:LTV Ratio 1:7.2Profit – $992,000
Closed Loop Profit Ex. Startup SaaS Company Over 1 YearCustomers Acquired – 40 LTV = $28,800 $28,800 x 40 = 1.152M Pre Sales Cost Profits Generated – 1.152M
No Closed Loop Profit Est. Ex. Startup SaaS Company Over 1 YearSQL Leads Generated – 80 Avg Sales Close Ratio - 50%LTV = $28,80080 x .5 = 40$28,800 x 40 = 1.152M Estimated Pre Sales Cost Profits – 1.152M
Questions Presented by: Gabe Wahhab President – Savvy Panda @gabewahhab @savvypanda