ROI cal­cu­la­tion for sales pro­mo­tion tech­nol­ogy

Stitch World - - RETAIL TECHNOLOGY -

SMS mar­ket­ing

No of items sold per year (as­sumed) 2000

Cost. of bulk SMS mar­ket­ing per month 131 ($ 131 for 50,000 SMS per month)

Cost of bulk sms per SMS (for one year) 1572

Num­ber of re­cip­i­ents (as­sump­tion) 1000

Cam­paigns per month (as­sump­tion) 4

Av­er­age read­ing rate 90% to 95%

Es­ti­mated re­sponse rate (3% to 90%) 65%

Av­er­age price of per item sold ($) ($ 6 profit) 30 Profit per item 6

In­crease in sales due to this tech­nol­ogy 12% (12% to15%)

In­crease in items sold 240 Profit due to bulk mes­sag­ing 1440 ROI in first year (%) 91.60

Bea­cons

Cost of app devel­op­ment ($) 1000

Cost of bea­con de­vice ($) 30

De­pre­ci­a­tion rate (%) 25

De­pre­ci­ated value of bea­con ($) 24

Cost of app main­te­nance (per year) ($) 200

Bea­con main­te­nance (bat­tery main­te­nance) (per 108 an­num) ($)

To­tal cost per year 1332

Num­ber of cus­tomers tar­geted in a month 1000

Es­ti­mated re­sponse rate (%) 75

In­crease in sales due to this tech­nol­ogy (35%-40%) 40

In­crease in No. of items sold 800 Profit per item 6

Av­er­age cost of per item sold($) ($6 profit)(%) 30

Profit due to bea­cons 4800 ROI in first year (%) 360.36

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