Payback is nine months. Doubling acquisition would empty the account.

Acquisition spend that is clearly profitable over a year can still be unaffordable this quarter, and the reason has nothing to do with whether the marketing works.

By Steve 5 min read
Abstract bridge artwork for Payback is nine months. Doubling acquisition would empty the account.

A familiar argument: marketing presents a channel returning three pounds of lifetime value for every pound spent and asks to triple the budget. Finance says the money is not there. Both are right, and the disagreement is not really about marketing. It is about the fact that customer acquisition cost is a working capital item that has been filed under advertising. Payback is a cash statement, not a profit statement Lifetime value to CAC ratios describe whether an acquisition is worth making. Payback period describes when the money comes back.…

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