Developing a customer acquisition strategy requires measuring and understanding the correct KPIs. The table below features the 9 most important customer acquisition metrics and benchmarks based on data from 130+ marketing campaigns our agency ran between 2018 and 2023. Our dataset’s company composition was as follows:
- Small-to-Midsize ($10M-$100M) – 39%
- Low Middle Market ($100M-$1B) – 43%
- Upper Middle Market & Enterprise ($1B+) – 18%
Lastly, our customer acquisition was accomplished primarily through organic SEO (71% of campaigns) with Paid Search following (18%), and the remainder a combination of Paid and Organic Social; Video Marketing; and Email Marketing.
Customer Acquisition KPIs and Benchmarks
| KPI | Benchmark | Definition |
| Customer Acquisition Cost (CAC) | Organic: $942 | The average cost of acquiring each new customer. CAC is one of the most important customer acquisition metrics, and combined with your LTV allows you to determine if your sales and marketing efforts are effective. |
| Paid: $1,907 | ||
| Customer Lifetime Value (LTV) | Highly variable, see LTV Benchmarks | The total revenue made from an average customer over their lifetime. While not directly tied to customer acquisition, knowing your LTVs is necessary to understand whether or not your company is spending too much on sales and marketing. |
| LTV-to-CAC Ratio | 3:1 | As its name suggests, the simple ratio of your LTV versus your CAC. A 3:1 ratio—making 3 times as much from the average customer as it takes to acquire them—is the standard target but higher ratios can be achieved by prioritizing low-CAC marketing channels. |
| Annual Churn | 8.5% | The percentage of customers that your company loses in a year. Churn is most relevant for services and SaaS businesses, but may also be tracked |
| Website Visitors | +45% YoY | The total number of visitors to the business’s website. Along with your visitor-to-lead conversion rate, knowing your traffic allows you to create accurate forecasts of your sales pipeline. Website traffic can also be further segmented by traffic source, allowing for greater precision in analysis. |
| Visitor-to-Lead Conversion Rate | 2.2% | The percentage of website visitors that take a conversion action such as filling out a contact form on your website. A conversion rate of 2.2% is a strong general benchmark to aim for, but keep per-channel and per-industry statistics in mind when setting goals. |
| Pipeline Velocity | $500/day to $5,000/day, depending on industry and company type | A measurement of how quickly leads move through your funnel and convert into closed sales and actual revenue. Pipeline velocity takes deal size into account so as not to give undue weight to smaller deals that close faster. |
| Shopping Cart Abandonment Rate | 69% | Relevant only to eCommerce businesses, Shopping Cart Abandonment Rate is the percentage of customers that do not make a purchase after adding products to their shopping cart. |
| Average Order Value | Highly variable based on industry and product type | The average value of a single purchase from a client or customer. As with Shopping Cart Abandonment Rate, Average Order Value is most relevant for eCommerce businesses. |
How to Use Customer Acquisition KPIs
Knowing how your KPIs stack up against the benchmarks above paints only half the picture. You must also know how to course-correct should a KPI be lagging. We discuss how to do so in the table below, as well as their their significance in developing, evaluating, and improving your customer acquisition strategy.
| KPI | How to Improve |
| Customer Acquisition Cost (CAC) | The most common cause of too-high CACs is an overreliance on paid marketing channels that provide short-term results at the cost of ROI. An effective customer acquisition strategy should be built around high-return inbound marketing channels. |
| Customer Lifetime Value (LTV) | If your customer LTV is too low, you are likely targeting a low-value audience, or not providing enough incentive for customers to make repeat purchases. Consider including reward programs, maintenance plans, and bundle deals to drive up LTVs through long-term relationships. |
| LTV-to-CAC Ratio | Addressing your LTV-to-CAC ratio requires first assessing which individual KPI is lagging: CAC or LTV. As we mentioned above, if your CAC is farther off-mark, leverage more low-cost/long-term organic marketing channels; and if your LTV is the issue, then create incentives for customers to make repeat purchases. |
| Annual Churn | Assuming that there are no clear faults in your product or service that may be causing customers to leave, high churn indicates poor targeting in your lead generation programs. Acquiring new customers that don’t truly need your products or services will lead to those customers leaving quickly. |
| Website Visitors | If your website traffic is low and doesn’t show signs of growth, your website probably isn’t showing up at the top of relevant search results. Consider investing in SEO to ensure that potential customers find your pages when searching on Google. |
| Visitor-to-Lead Conversion Rate | If the conversion rate on your website isn’t high enough, make sure your website follows conversion optimization best practices. Visitors on your website must be presented with clear next steps, and experience as little friction as possible should they wish to reach out to your sales team. |
| Pipeline Velocity | Pipeline velocity is a complex metric, but the main contributing factors are your average order/contract value, conversion rate, number of qualified leads, and sales cycle length. To improve your pipeline velocity, each of these individual metrics will need to be addressed. |
| Shopping Cart Abandonment Rate | The simplest way that ecommerce companies can improve their shopping cart abandonment rates is to follow up with customers when they abandon carts. This can be done both through pop-up windows while those customers are on your website, as well as email reminders after they close the page. Customer loyalty programs and email coupons will help encourage visitors to leave their information so your team can set up automated reminders for any abandoned carts. |
| Average Order Value | Average order value can be improved by offering customers incentives for larger purchases such as bundling or offering complimentary items for large orders, selling extended warranties or maintenance plans, or simply by promoting more premium products on your home and main product category pages. |
Improving Your Customer Acquisition KPIs
Customer acquisition is a complex process where any single change could have cascading effects on the rest of your pipeline. Understanding the above KPIs will help your team understand where they can improve their efforts, but many companies find they lack the expertise or in-house resources to fully address flaws in their customer acquisition strategy.
For that reason, many companies choose to partner with an experienced firm, whether long-term or as as stopgap while training up their in-house team. Our agency specializes in high-ROI customer acquisition via a combination of thought leadership content, SEO, and judicious use of paid search. If you’re interested in exploring a partnership with us, you can reach out here.
