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What is the minimum retention rate for each segment required

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Reference no: EM132993315

Absolut launched three vodkas to the market: Level, Absolut, and Fris. They expected to sell the vodkas in the ratio 3:5:12 respectively. The prices of the bottles will be $34, $19, and $7, and have variable costs of $10, $8, and $4, respectively. They plan to spend $20M in R&D, $10M in equipment and $175M in advertising to acquire 10 million new customers.

Problem a. Suppose the company is considering mailing out a $5 birthday coupon to encourage loyalty. What is the minimum retention rate for each segment required to maintain the same CLV

Reference no: EM132993315

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