August 08, 2023

Fast vs. Long Payback Window

The table below features two different payback windows. Both windows pay you back the same amount of profit within five years. The top portion of the table pays you back quickly, the bottom portion of the table pays you back slowly.

Which business would you prefer to run? I'd prefer the top business. With rapid payback, you are profitable faster, meaning you can actually invest even more money today.

If you run this table for your business, you fully understand how your payback window looks by marketing channel, correct? If you don't run this table, give me a holler and we'll get you started with a Marketing Budget Experiment.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.

MRV (Merchandise Residual Value): A Jewelry Example

Yesterday I showed you how Home merchandise negatively impacted how the customer behaved in the future. Here's Jewelry for the same bran...