Blended CAC vs Incremental CAC
Blended CAC is Total Spend / Total New Customers. Incremental CAC is Total Spend / *Net New Paying* Customers generated by that spend. Blended CAC averages strictly paid performance with free organic traffic, often masking the inefficiency of paid channels.
The Short Version
Blended is a company metric. Incremental is a marketing metric.
Prerequisites
The Scaling Ceiling
You scale based on a $40 Blended CAC. But your Incremental CAC is $120.
As you spend more, 'organic' stays flat, so Blended CAC rapidly converges towards the expensive Incremental CAC, destroying profitability.
How it works
Blended CAC = Total Spend / Total Customers
Incremental CAC = Total Spend / (Total Customers - Baseline Customers)
Compare the delta to see how much 'Organic Subsidy' you are relying on
Common Misconceptions
Setting paid media targets based on Blended CAC
Denying that diminishing returns exist because Blended CAC looks stable
Failing to separate paid impact from brand momentum
Related Terms
Frequently Asked Questions
QWhen should I use Blended?
Use Blended for overall business financial planning (P&L). Use Incremental for making ad budget decisions.