Hello all,
Happy to report that I have managed to get my CI up to 100%.
My question is; What % of revenue (or profit) is required to maintain that level?
Thanks in advance
Richard
It is highly variable.
The amount of Marketing expense is dependent on the number of routes that you operate. So if you're a regional airline flying many less-dense routes, it will take a large percentage of your Revenue. I've had it be as high as 40% when flying sufficiently small aircraft on thin routes. If you're flying an airline that focuses on highly-dense routes with very large aircraft it will be a fairly small portion of your revenue -- I've had it be as low as 5% to maintain 100CI.
If you're asking whether or not you'll ever need to add any more -- No. Whatever outlay I expend to get to 100CI has always been sufficient to maintain it. It will scale itself as I add a sufficient number of new routes.
If you're asking whether or not you can cut some -- it depends on how fast you got to 100CI. If you're down to earning maybe 0.1%/week from 95-100, then that's about as low as you can go and still maintain a CI of 100. If you were earning more than that per week on the way up, you likely have some "excess" that you can cut out of your budget if you'd like. You'll just have to experiment until you reach the right dollar outlay to keep it where it's at if tweaking that is important to you.