calculating the profie

Reference Chapter for Assignment 2: Chapter 6: E-Commerce Marketing and Advertising Concepts

Use the above Online Consumer Purchasing Model and information provided to assess the effectiveness of an e-mail marketing campaign for a small-sized e-commerce company focused on sales of trendy apparel to the ages 18-26 young adult market in the United States.

For this e-mail marketing campaign:

The company purchased and used 100,000 e-mail addresses @ 25 cents cost per e-mail address.

The expected click-through rate is 15%

The conversion to customer rate is 10%

The loyal customer retention rate is 25% (for the purpose of this e-mail marketing campaign assume that a loyal customer makes two purchases).

The average sale is $60.00

The profit margin is 50%

Answer/Respond to the following:

1. Does this e-mail marketing campaign produce a profit? (Must show all work to support answer to receive credit).

2. Suggest some specific ways to increase the response rate to this e-mail marketing campaign.

3. Are e-mail marketing campaigns effective? If not, why not? If yes, why are they effective and which specific types of e-mail marketing campaigns are most effective?