Calculate the breakeven revenue for a new groupon customer

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Reference no: EM13763906

A local dental practice decides to run a Group on campaign. The campaign offered $345 worth of dental services (such as teeth whitening) for $150. For the total campaign, 250 coupons were sold. We estimate that 85% of the coupons will be redeemed, that 35% of the coupons will be redeemed by existing customers and that, on average, Group on customers purchased 1.5 coupons. Let’s assume that 30% of new customers come back after the Groupon coupon visit. The dental practice estimates its cost of goods sold to be 55%. Finally, the bill for the average Groupon customer was $385. The dental practice negotiated a 50/50 split with Groupon.

Calculate the breakeven revenue for a new Groupon customer.

Reference no: EM13763906

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