All users are not the same: Shifting away from universal CAC Targets 

90%
Average increase in Week One cohort Revenue Q/Q
67%
Increase in major KPI events while reducing spend 21% Q/Q
41%
Improvement in primary conversion rate

Introduction

Our client, a localized savings app, came to us wanting to scale their growth program. We evaluated their growth goals against their existing KPIs, and worked with them to implement localized CAC goals based on user-LTV in that area. 

Paid Social
Creative
Growth Analytics

Challenge

We worked with this client to acquire users who would drive additional revenue by incorporating our growth analytics team. What we discovered was that: 

(1) The client was losing out on significant revenue by targeting a universal KPI / CAC, having limited visibility into long-term performance, and focusing only on funnel-optimization versus value-optimization.

(2) The average new user cohorts were churning quickly

Approach

We took a deep dive into our client’s digital ads, ad attribution, and product analytics to seek out opportunities. We worked on a strategy that would allow us to set goals based on real-world information by including an analysis of retention and ARPU by location, channel, and mobile operating system.

Results

Using data analytics to focus on value-optimization, we were able to better understand the behaviors that signaled a strong user. As a result, the average new cohort was retaining for much longer which allowed our client to capture additional revenue.

This chart shows how newly acquired cohorts were continuing to monetize at higher rates once we implemented our long-term strategy which allowed for variable CAC goals based on LTV predictions. The 'green' colored cohorts represent the first cohorts operating with this new strategy.
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