How to Reduce CAC in Growth-stage Startups?
?? Piyanka Jain ??
CEO - Aryng | Data Science/AI/Data Engineering Consulting for High-Growth Mid-Market org | Enterprise Data Literacy and Analytics Skills Training | International Bestseller Author & Speaker
“The lifeblood of any hyper-growth organization is scalable CAC.” says Ata Khan , VP of growth marketing at Inside Real Estate.
And I couldn’t agree more.?
CAC is not an issue as much during a startup’s early stages. You are focused on establishing product-market fit and building out your sales process. But during the growth stage, it’s a different story.
The importance of scalable CAC
During the growth stage, a high CAC eats into your funding runway and this needs to be solved fast.
The sooner you reduce your CAC, the more resources you free up for sustainable scaling and the better your company performs in the long-run.?
This is also evident from what Vijay Aviur, partner at Aryng, shared “In the journey of startup leadership, CAC (Customer Acquisition Cost) isn't just a metric; it's the compass guiding your path to sustainable growth.”
Your CAC may be higher than you think!
If you’re only measuring those costs that can be directly tracked, you may be forgetting everything else that’s going into acquisition - costs for automation, analytics, design tools; expenses related to content creation; A/B testing or experimentation with ad campaigns; agency fees etc.
Missing or miscalculating these costs could hinder you from making the right decisions.?
When you’re able to track both direct and indirect parts of your blended CAC better, you’ll be in better shape to reduce it because you can only manage what you can measure.?
As Cathy Tanimura , VP of Analytics at Summit Partners rightfully puts it, “Staying close to the data helps marketers both optimize channels that are performing and experiment with the constantly evolving landscape of new ones.”
There’s more to CAC than meets the eye
Reducing CAC isn’t as simple as cutting down the most expensive acquisition channel because what if that’s the channel with the greatest ROI?
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Tracking your CAC is one thing, but making the right decisions involves a whole lot more.
How can you cut CAC without hurting your revenue growth? How can you scale better without burning through your funds? How can you create profitable partnerships that will fuel growth?
Join the upcoming Data Matters live webinar ‘How to prevent death by CAC’ on September 28 (Thursday) to hear successful strategies from industry experts that can help you reduce CAC by up to 20-40%.?
Learn from an impressive panel :
Each of them will be bringing decades of their expertise on CAC to the table so you can take away the proven insights you need to bring it down.?
To quote Vijay again, who will host this webinar,
“CAC isn't just an acronym for Customer Acquisition Cost; it's your 'Customer Attraction Currency.' Spend it wisely, and your leadership and journey will be the talk of the entrepreneurial town!”