Mark owns GloboGym in Boston and is considering bidding for keywords on Google Search.
· Mark has a landing page on his gym’s website that offers a free trial for two weeks. Arrivals convert at 5% into email sign-ups (valid leads)
· 20% of the leads convert after a free trial
· Mark charges $100 a month.
· The average customer stays for 10 months.
· Mark’s costs are $50/month.
· Assume the free trial costs $25!
Assignment – Answer the following five questions
1) Analyze Mark’s business using a funnel framework.
2) What can Mark bid on a per click basis given his current profitability?
3) Go through the funnel – what could Mark do at each step to improve performance?
4) Mark is considering marketing analyst who sets up MailChimp. Suppose he gets 10% additional of the sign-ups. How does this impact what he can bid per click?
5) Mark’s marketing analyst makes several marketing partnerships with other local companies including a healthy restaurant chain, and a fitness apparel company. These partnerships generate an average of $1 more email sign-up. How does this impact what he can bid per click?