Why Averaged Ad Costs Lie (Blended vs. Channel CAC)

Why this matters

Blended CAC hides the truth about which channels are working. When you divide total spend by total customers, the efficient channels subsidise the inefficient ones and the signal disappears. Channel-level CAC is what lets you reallocate budget away from the channels that are destroying value and toward the ones that create it — but it also requires honest attribution, which is where most teams get stuck.

Demo

Blended CAC = Total spend across all channels ÷ Total new customers. Channel CAC = Spend on channel X ÷ New customers attributed to channel X. The gap between the two reveals cross-channel subsidy.

Try it yourself

1. Double the Meta spend to 12000 while keeping customers at 25 — recalculate blended CAC and observe how a single channel can drag the overall number.
2. Add a 'direct/organic' row with spend=0 and customers=30 (organic conversions) and recompute blended CAC — observe how organic attribution inflates paid efficiency metrics.
3. Rank the three channels by CAC and draft a one-sentence budget reallocation recommendation for each.
4. Research how last-click vs. data-driven attribution in Google Ads changes the customer counts assigned to each channel and therefore channel CAC.

References

• https://www.reforge.com/blog/growth-metric-frameworks
• https://support.google.com/analytics/answer/10596866