Now suddenly it all makes sense. Squarespace is a web hosting service, nothing unique about that. But they obviously have a smart marketing team which thought of this innovative way to get themselves some buzz. So squarespace is indeed giving out free Iphones. Well actually they are giving out $199 Apple gift certificates, thus you have pay for your on own data plan and stuff. So its not even an unlocked phone. Now doing the math, Squarespace is investing $5970 for a 30 day campaign.
And what are they getting in return: almost 15mn unique impressions each day for 30 days. Assuming a cost of 1 cent per impression, they are getting $4.5mn worth of eyeballs. Considering a 3% click through rate and a rate of 50 cents per click, that is equivalent to $6.75mn worth equivalent campaign on Google Adwords. Now assuming they have a 3% conversion rate, they would have already signed up over 400,000 accounts. Their cheapest plan is worth $8/month, so let us assume everyone takes only that the basic plan. Now considering a profit margin of $2/month and retention of 1 year, we are looking at customer value of $91, leading to profits to the tune of $37mn!!!
That is an estimated ROI of over 617326% !!!
My head is spinning already, This has got to be one of most amazing breakthroughs in marketing history. I know there are lot of assumptions in my calculations, but I’ve tried to be conservative and err on the lower side in every assumption. No matter how you choose to look at it, it is still a mind boggling number in profits and ROI for a single campaign. Hats off to Squarespace, you guys rock, and as a tribute, I’m gonna tweet about them. Who knows, heck I might actually snag one of those Iphones.
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