In plain words
Goal seek turns a calculation round. Where a forecast answers what a plan earns at a given price, goal seek asks what price makes the plan hit a target. You fix the goal, pick one input to move, and solve for it.
It turns a vague aim into a number someone can act on. Pay back within three months becomes a first-order price. Break even on ads becomes the most a customer may cost to acquire.
Formula
- Find the value of one input at which the result equals the target, with every other input held
Worked example
The coffee subscription's first order sells for $32.00 and pays back its $30.00 acquisition cost in month 5. To pay back by month 3, the engine solves for the first-order price: $38.45.
Or leave the price alone and ask about retention. To pay back by month 4, every renewal rate would have to rise by 1.4 points.
The example order
A $40.00 bag of coffee, shipped free, every cost counted
2 declared kinds cost nothing on this option
| Step | Grain | Amount |
|---|---|---|
| Revenue | – | $40.00 |
| Cost of goods | per unit | −$12.00 |
| Pick and pack | per order | −$1.18 |
| Packaging | per parcel | −$0.50 |
| Shipping label | per parcel | −$7.50 |
| Card fee per order | per order | −$0.30 |
| Refunds | percent | −$2.00 |
| Card processing | percent | −$1.16 |
| Contribution margin | – | $15.36 |
| 2 kinds costing nothing | – | $0.00 |
Computed by the margin engine in Offer Suite's own code, in whole cents, from a $40.00 bag of coffee with a $12.00 unit cost.
A solved value is not a recommendation
Goal seek says what an input would have to be. It does not say the market will accept it. A first-order price that pays back sooner will also convert fewer visitors, and nothing in the solve knows by how much.
Using it
Solve for one input at a time and read the answer as a boundary. If the price that reaches your payback target is far above anything you could charge, the target is wrong or another input has to move. When there is no answer at all, the reason is the finding: no price pays back by then.
In Offer Suite
Offer Suite's simulator can solve a subscription offer for the highest acquisition cost, the lowest first-order price, the renewal lift, the mix of options or the ad budget that reaches a goal. When no value does, it says why and does not answer with the nearest one.
Source: Offer Suite's offer simulator.