In This February 23, 2010 Update: |
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Networking EventsFeb 25 (Thu) 5:30 pm - 8:00 pm, Legal/Medical Networking West Palm Beach"Connecting professionals in the legal and medical field" Expected Turnout 80+ Where: Mambo Italiano 308 Clematis Street West Palm Beach,
FL 33401 Seminars, Workshops, & Other EventsMar 25 (Thu) 6:00 pm - 7:55 pm, FREE Seminar How to Turn an Idea Into a Business in 1 DayLearn the "secret" tools and strategies to take your ideas for new products, services or businesses and quickly and inexpensively launch, test and market them in under 24 hours. When: Mar 25, 2010 at 6:00 pm - 7:55pm Expos & Trade ShowsFeb 24 (Wed) 6:00 pm-10:00 pm, SOUTH FLORIDA Business-to-Business Trade ShowJUMPSTART YOUR NEW YEAR!!! 80 Consecutive Sold-Out Trade Shows, Over 15,375 Exhibitors, Over 304,000 Attendees, Millions of Dollars in Transacted Business, Partnerships, Alliances, Contracts, New Customers, New Relationships, New Product Where: The Miami Free Zone, 2305 NW 107th Avenue, Doral,
FL 33172 Articles of InterestCustomer Acquisition Cost
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So I am watching ‘Shark Tank’ on ABC a few nights ago, for those who are unfamiliar, the series stars five ‘sharks’ – multi-millionaire business tycoons – who hear investment proposals from entrepreneurs and consider whether to invest in the business. This particular episode was intriguing and insightful in that, the contestant (owner of an online print cartridge company) had put $50,000 of his personal savings into the project now seeking $150,000 but couldn’t answer one key question asked by the panel; “What is the cost of acquiring a customer?” Needless to say he didn’t receive any funding but it is to ask ourselves as business owners do we know the answer? Customer acquisition cost is the cost associated with convincing consumers to buy your product or service, including research, marketing and advertising costs. Customer acquisition management components include:
A Desirable Customer Acquisition Formula =
I know, you just want to ‘close the deal’ not write a thesis however, if banks aren’t lending and you are approaching private investors (sharks) you better be prepared. Nothing is more disappointing to a savvy investor than someone who is more interested in gimmicks than mastering the fundamentals. Living in South Florida we are exposed on a daily basis to companies that believe if I ‘fake it’ long enough or copy someone else’s formula they’ll buy my product. The flaw in this theory is that by not knowing the cost of acquiring the customer and more importantly, assessing the long term ROI of that customer you may undervaluing your product or service. E.g. Production cost is $150 per customer yet you have a unit price of $75. Here you’re running a 50% per unit net loss. This loss may or may not be acceptable, depending on the “Lifetime Value” of your customer. That is, if they order on average 5 times from you over the course of what you deem their lifetime to be (which could be any realistic time period where they do business with you, from days, two years), you would be generating $375 in revenue and be at a 150% profit. So knowing BOTH, your customer acquisition costs and customer lifetime value are critical to profitability. So who would invest in your company based on how you’re operating? You might say “Well if I could just get $20,000 $30,000 or $100,000 I can do a media blitz, get a new website and…” STOP! Warren Buffett puts it quite eloquently “I invest in the management team of a company. One cannot predict economic volatility but if management is solid then they’ll make the right decisions over time.” All too often entrepreneurs spend too much time in their business and not enough time working ON their business. This is where education comes in, where you can build your management savvy so an investor, like Warren Buffett can feel comfortable investing in YOU. Each week in the South Florida Business Events Weekly Newsletter, we work hard to share with you great events, seminars and workshops to help you and your business. Be sure to take advantage of the opportunities presented, invest in yourself and attend some of these great events. So back to the TV show, I guess the moral of the story is: if you want to swim with the sharks make sure you don’t end up as bait! Omahar K. Stephenson Sources: Wikipedia Useful Products & ServicesFree 30 Minute No Obligation Tax Session to First 20 PeopleSchanel & Associates/CPA's, offers an array of integrated financial services designed to assist individuals and business with their tax, accounting and financial needs. Call NOW and the FIRST 20 people that contact us by March 8th, 2010, will receive a free 30 minute no obligation tax session for individual or business taxes. Remember: Remember: Business taxes are due by March 15. Call Lin Haller at 561-624-2118 NOW. Improve Your Credit Score with Allstate Business ConsultantsAllstate Business Consultants, a proud member of Business Events Florida (BEF), is offering an exclusive program to members of BEF. If you, or someone you know is having problems with their credit or their unsecured credit card debt, please read the attached letter. They have the ability to remove the derogatory information from your credit reports, making you a bankable individual and help you to settle your unsecured debts between 25-55 cents on the dollar in a payment plan between 1 and 4 years. They CAN HELP YOU. CALL Scott Somers now at 954-614-5853. Visit this page for the letter http://www.mikeowenbiz.com/yourcredit.html Increase Your Marketing FootprintRather than cut your marketing budget, this is the time to either increase marketing or, at minimum hold it steady. Let ‘A Business Affair Magazine’ and Business Events Florida promote your business and services to local markets. Visit www.BusinessEventsFlorida.com ; www.aBusinessAffairMagazine.com or call 754-234-1018 for more info. Advertise in Martini Networking Business Events WeeklyLooking to reach 10,000+ South Florida business people? Advertise your events, products, services and business here, on our Web site or a dedicated (solo) email.. Visit www.MartiniNetworking.com for more details. Your
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Martini Networking, 8975 NW 39th Street, Sunrise, FL 33351 |
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