Strategy What You Need to Know About Promotional Offers

Gross margin $56,250 $70,312.50 Cost in the mail @ 70¢/book $17,500 $17,500 Contribution $38,750 $52,812.50 Net shipping revenue ($14,062.50) Adjusted Contribution $38,750 $38,750

Note: Assumes lost shipping revenue at 10 percent of net sales. And assumes mail costs for the free shipping is the same as the control. But if there's a dot whack or wrap promoting free shipping, the mail cost must be adjusted accordingly.