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Discount Factor

NPV of Expected Cash Flow from Customer

Total NPV of CLTV

Increase in CLTV per customer of new Marketing Plan

Multiplied by # of Customers to obtain increase in profit of Rosewood from new brand strategyDivided by 32% gross margin to obtain increase in Revenue of Rosewood from new brand strategy

b$1 million growing at 3% per year allocated to 115,000 guests

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Without Rosewood Branding(2003)

WithRosewood Corporate

Branding

115,000 115,000

$750.00 $750.00 growing at

2.0 2.032% 32%

1.2 1.3

$130.00 $138.70 growing at

$150.00 $150.00

19,169 24,919

5,750 11500

8% 8%

16.67% 21.67%

2003 2004 2005

2.0 2.0

1.2 1.2

$795.00 $842.70

$1,908.00 $2,022.48

$610.56 $647.19

$150.00 $0.00 $0.00

$133.90 $137.92

($150.00) $476.66 $509.28

1.00 1.00 0.17

($150.00) $476.66 $84.90

1.000 0.926 0.857

($150.00) $441.35 $72.78

$378.49

2003 2004 2005

2.0 2.0

1.3 1.3

$795.00 $842.70

$2,067.00 $2,191.02

$661.44 $701.13$150.00

$133.90 $137.92

$8.96 $9.23

($150.00) $518.58 $553.98

1.00 1.00 0.22

($150.00) $518.58 $120.04

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1.000 0.926 0.857

($150.00) $480.17 $102.92

$461.09

$82.60

$9,498,542$29,682,943

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Growth Rate

6%

3%

2006 2007 2008 2009

2.0 2.0 2.0 2.0

1.2 1.2 1.2 1.2

$893.26 $946.86 $1,003.67 $1,063.89

$2,143.83 $2,272.46 $2,408.81 $2,553.33

$686.03 $727.19 $770.82 $817.07

$0.00 $0.00 $0.00 $0.00

$142.05 $146.32 $150.71 $155.23

$543.97 $580.87 $620.11 $661.84

0.03 0.00 0.00 0.00

$15.12 $2.69 $0.48 $0.09

0.794 0.735 0.681 0.630

$12.00 $1.98 $0.33 $0.05

2006 2007 2008 2009

2.0 2.0 2.0 2.0

1.3 1.3 1.3 1.3

$893.26 $946.86 $1,003.67 $1,063.89

$2,322.48 $2,461.83 $2,609.54 $2,766.11

$743.19 $787.79 $835.05 $885.16

$142.05 $146.32 $150.71 $155.23

$9.50 $9.79 $10.08 $10.38

$591.64 $631.68 $674.27 $719.55

0.05 0.01 0.00 0.00

$27.78 $6.43 $1.49 $0.34

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0.794 0.735 0.681 0.630

$22.05 $4.72 $1.01 $0.22