Brand & Customers: key terms, formulas and examples
A brand is a promise customers trust. Brand equity, loyalty and word of mouth lower the cost of winning customers, while churn counts those who leave.
Example
100 customers start the month and 5 leave: churn is 5%.
Takeaway
Keeping a customer usually costs less than finding a new one.
Key terms
- Brand equity
- Extra value a known brand adds to a product.
- Market share
- Your sales as a percentage of total sales in the market.
- Churn
- Share of customers who stop buying in a period.
- Brand loyalty
- Customers' habit of choosing the same brand again and again.
- Brand awareness
- How well people recognize a brand.
- Target audience
- The group a message is aimed at.
- Customer base
- All the people who buy from a business.
Formulas
Customer lifetime valueARPU × GM ÷ churn
Market shareS ÷ M × 100
Cost per lead (CPL)S ÷ L
Cost per click (CPC)S ÷ C
Click-through rate (CTR)C ÷ I × 100
Cost per thousand views (CPM)S ÷ I × 1000
Break-even ROAS100 ÷ m
Viral coefficienti × c
Customer retention rate(E − N) ÷ S × 100
Customer acquisition costMarketing ÷ New customers
Churn rateLost ÷ Start × 100
Net promoter score%P − %D
Master Brand & Customers in a game
Quizzes, a CEO simulator, a real estate tycoon game and startup tools. Free to start, in 7 languages.
Play BizJourney free →