See how much you're really spending to acquire customers—and how group buying can cut your CAC by 40% while turning customers into your marketing team.
Customer Acquisition Cost (CAC) is the total cost of converting a prospect into a paying customer. It's calculated by dividing your total marketing spend by the number of new customers acquired.
Traditional CAC is rising rapidly due to iOS 14 privacy changes, cookie deprecation, and ad saturation. The average Shopify store now spends $50-130 to acquire a single customer.
Instead of paying for each customer through ads, group buying turns your existing customers into your marketing team. When customers invite friends to join a group for better discounts, you acquire new customers through word-of-mouth—at zero ad cost.
Example: $2,000 ÷ 40 customers = $50 CAC
CAC varies significantly by industry. Here's how Shopify stores typically perform:
| Industry | Average CAC | Benchmark |
|---|---|---|
| Beauty & Personal Care | $40-60 | |
| Fashion & Apparel | $50-100 | |
| Pet Products | $45-80 | |
| Home & Garden | $60-150 | |
| Food & Beverage | $30-70 | |
| Electronics | $70-150 |
Source: Shopify Industry Data 2024
The average CAC for ecommerce ranges from $50-130, but a 'good' CAC depends on your Customer Lifetime Value (LTV). Aim for a CAC to LTV ratio of 1:3 or better—meaning each customer should bring 3x what you spent to acquire them.
Key strategies include: 1) Referral marketing (customers bring friends for free), 2) Group buying campaigns (40% lower CAC on average), 3) Improving conversion rates, 4) Organic SEO and content marketing, 5) Optimizing checkout to reduce cart abandonment.
The ideal CAC to LTV ratio is 1:3 to 1:5. This means for every $1 spent acquiring a customer, they should generate $3-5 in lifetime revenue. A ratio below 1:3 indicates you're spending too much on acquisition relative to customer value.
Group buying turns customers into marketers. When customers invite friends to join a group for discounts, you acquire new customers through word-of-mouth instead of paid ads. Data shows group buying campaigns reduce CAC by 40% on average while increasing viral referrals by 50%.
Average CAC varies significantly: Beauty & Personal Care ($40-60), Fashion & Apparel ($50-100), Home & Garden ($60-150), Electronics ($70-150), and Food & Beverage ($30-70). These figures are for Shopify stores with fewer than four employees.
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