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Yahoo Search Marketing Pay Per Click Advertising Forum

    
Check this guy out
BoneHeadicus




msg:812205
 5:47 am on Jan 15, 2001 (gmt 0)

[dreamstargroup.com ]

Sad thing is he probably makes more money than I do :(

Cool script. I dunno if it really has any value to it but it looks like it's telling you something. Turn tedster loose on it, he'll know if it's real figures or not.

 

tedster




msg:812206
 6:13 am on Jan 15, 2001 (gmt 0)

BH, it looks like it's full of holes to me -- but the basic idea makes sense. Seat-of-the-pants purchases can bust you pretty quickly, so you'd better get a handle on how much you can afford.

However, one number that's very wobbly here is "average number of sessions per month". What if a website is both sales and service? All those service oriented sessions don't belong in this calculation. This calculator assumes that the site is pure marketing/sales.

One concept I almost never hear kicked around online is the "lifetime value of a customer". It's really common in the bricks world to look at that number when deciding whether the "cost to acquire a new customer" makes sense. Of course, the web is probably too new to KNOW the lifetime of a customer.

My sense is that the offline world puts a lot more energy into retention marketing than the online world has done so far. That's just one more reason for the dot-com bust of recent days.

oilman




msg:812207
 6:30 am on Jan 15, 2001 (gmt 0)

not much of a formula if you ask me:

[gross revenue] - [expenses] = [profit]
[profit] / [monthly customers] = [profit per customer]
[# visitors] / [# customers] = [# visits to make sale]
and so on...

the math is way to simple and too many assumptions are being made for this calculation to have much meaning at all.

Not to meantion it does not take into account the quality of your keywords etc.

oilman




msg:812208
 6:32 am on Jan 15, 2001 (gmt 0)

hehe - looks like tedster was replying while I had my browser open 'cracking the code' ;)

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