Question

Topic: Strategy

Urgent - Need Help Fast With A Retail Food Product

Posted by Anonymous on 500 Points
We have a new retail food product (a one-of-a-kind product that sells for $2.99 for a box of 40) which just went to market this past year. I'm doing the '05 budget and am including an estimate of what each marketing activity will generate in terms of impressions and then a cost per impression, estimated conversion to sales percentage and cost per sale per each marketing activity. In this figure, however, I have to include an estimate about repeat sales. Since we really don't have historical data at this point to help us with this figure, does it seem reasonable to assume that 2/3s of the people who purchase our product one month will buy it the following month so that I am always rolling over to the next month 2/3rds of the customers I have had from the month before? Is this too high? Is there an industry average? Or how else should I calculate this?
Thanks so much for your help.
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