EMPERIO Marketing Lab
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Set a CAC ceiling for Bengaluru coffee

Bengaluru, Karnataka · Fictional practice case

The decision

A coffee subscription spends ₹1.5 lakh for 600 new customers. Each active customer contributes ₹110 a month. Expected active shares in months one to four are 100%, 75%, 55% and 45%.

Should the team scale the channel if its next cohort costs ₹300 per customer?

Worked solution

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Case at a glance
Current CAC · ₹250. Four-month expected contribution · ₹302.50. At ₹300 CAC · ₹2.50 headroom
  1. Use net new customers and one measurement window. CAC is ₹1.5 lakh ÷ 600 = ₹250.
  2. Undiscounted cohort contribution per initial customer is ₹110 × (1 + .75 + .55 + .45) = ₹302.50. The observed model has ₹52.50 headroom, falling to ₹2.50 at ₹300 CAC.
  3. Test marginal CAC in a capped budget experiment. Use returns-adjusted contribution and compare against a downside in survival before adding spend.

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