FA-301b · Module 2

Channel Efficiency Analysis

3 min read

CAC is not one number — it is a portfolio of channel-specific acquisition costs. Inbound CAC includes content production, SEO, paid search, and the sales cost of converting inbound leads. Outbound CAC includes BDR compensation, tools, sequences, and the sales cost of converting outbound-generated meetings. Partner CAC includes channel management, partner incentives, and co-selling costs. Each channel has a different cost, conversion rate, and customer quality profile. Optimizing aggregate CAC without channel decomposition is optimizing blind.

CAC and Quality by Channel:
──────────────────────────────────────────────────────
              Inbound   Outbound   Partner   Events
──────────────────────────────────────────────────────
CAC:          $8,400    $18,200    $11,600   $24,800
Win Rate:       32%       18%        26%       22%
Cycle (days):    52        84         68        96
Gross Ret.:     91%       84%        93%       79%
LTV:          $72,000   $58,000    $84,000   $48,000
LTV/CAC:       8.6x      3.2x       7.2x      1.9x
Payback (mo):   4.2       8.8        5.4      14.2
──────────────────────────────────────────────────────

Inbound is most efficient. Partner produces
highest LTV. Events have worst unit economics.
Blended CAC of $14,200 hides this reality.

Do This

Calculate CAC separately by channel including all allocated costs
Include downstream quality metrics: retention, expansion, LTV — not just cost
Shift budget toward channels with the best LTV/CAC, not just the lowest CAC

Avoid This

Optimize for lowest CAC without considering customer quality — cheap customers who churn are expensive
Report blended CAC without channel decomposition
Fund all channels equally regardless of their efficiency differences