Spend to Grow

Therefore, if your goal is to break even after one year on the investment you initially make to acquire a new buyer, you can afford to invest up to $12.14 to acquire a new buyer in the first example. The year after the initial investment, your contribution to profit and overhead is a positive $8.15 per buyer. If you consider lifetime value, then the contribution in year two, three and beyond would be even greater. The point is, new buyers are the lifeblood of any catalog company, and you need to be willing to invest to acquire them.