Finance Maru Case Study

Topics: Advertising, Chiyoda, Tokyo, Tokyo Pages: 3 (662 words) Published: November 18, 2014
Finance Case Study: Maru Batting Center
Professor: Jeannette Monaco Student: Lydia Lin
Organized Chart
Segments /
Little Leaguers
Summer Sluggers
Elite Ballplayers
Boys and girls age 6-15
Adults, price sensitive
Men women age 16-35, elite players
No particular interest, price sensitive
Learn how to play
Practice for the baseball season
Practice skills
Night out, leisure activities
Time period in the year
Preseason months of Feb and March

Cost workers labor cost ¥1,500/hr
2 workers
1 instructor
1 worker
1 worker
1 instructor
2 workers
Avg hr/year
1.5 hr/year
Sponsored school teams
Kegs of beer (ex. Oseibo)
Mailing list and MBC’s Preseason Launch Party
Banner ads
Cost per contact
¥1,000/ person
¥1,500/ person
¥12,500/ person (list purchase, party, Wakamastu’s appearance fee) ¥300/person (publication)
¥50/ potential customer
10% become regular customer
Attrition Rate: 50%/year
Response rate: 15%
60% retention rate, could result in 25% response rate
35% retention rate, 2.5% response rate
1. Calculate customer acquisition cost per segment
Acquisition cost = Contact cost/ Response rate
i. Little Leaguers
¥ 1,000/10%=¥10,000
ii. Summer Sluggers
iii. Elite Ballplayers (print ad)
iv. Elite Ballplayers (party)
v. Entertainment Seekers

1. Calculate Breakeven cost (without discounted cash flow) per segment i. Little Leaguers
Year 3, when their “Cumulative Profit to Date” turns ¥1,563 from (¥1,250) ii. Summer Sluggers
Year 3, when their “Cumulative Profit to Date” turns ¥500 from (¥1,000) iii. Elite Ballplayers (print ad)
Year 4, when their “Cumulative Profit to Date” turns ¥5,280 from (¥1,200) iv. Elite Ballplayers (party)
Year 3, when their...
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