You divide the month’s ad spend by your orders and arrive at €20. Sounds cheap. Only some of those orders come from regulars who would have come back anyway and clicked the ad with your name on the way.
Two figures that are easy to mix up
CPA, the cost per conversion, divides ad spend by all attributed orders. New-customer cost, often called CAC, divides only by the orders of customers buying for the first time.
An example: €3,000 ad spend, 150 attributed orders, 60 of them from new customers.
| Calculation | Result | |
|---|---|---|
| Cost per order (CPA) | €3,000 / 150 | €20 |
| New-customer cost | €3,000 / 60 | €50 |
Both figures are correct; they just answer different questions. If you want to grow, the second is the one to allocate budget by.
How Metrunio knows who is new
Your shop says it best. It knows the order history, and the plugins for Shopify, Shopware and WordPress send the flag with each order as far as the shop knows it. Without it, Metrunio derives it from its own measurement and labels it as such. That is the weaker statement: Metrunio does not know what was bought before the first measurement. Someone who appears new in the first weeks may have been buying from you for years.
Next to the metric it says for what share of orders the customer type is known. The metric rests on that share alone.
€50: a lot or a little?
That depends on what a customer orders after the first purchase. €50 for someone who buys once for €30 is a loss. For someone who comes back every month, it can be earned back within a few months.
Continuing the example: on their first purchase the 60 new customers leave an average contribution margin of €18, that is net value minus cost of goods. After that, some come back.
| Month | Contribution margin per customer, cumulative | New-customer cost covered |
|---|---|---|
| 0 (first purchase) | €18 | no |
| 1 | €26 | no |
| 2 | €33 | no |
| 3 | €41 | no |
| 4 | €47 | no |
| 5 | €52 | yes |
After five months this group has earned back its new-customer cost. That is how the customer cohorts under “Commerce & products” show it: customers by the month of their first purchase, the cumulative contribution margin per customer for each following month, and in the “Paid back” column the first month in which it reaches the new-customer cost. Clicking a cell shows the orders behind it.
Where the calculation reaches its limits
- A repeat purchase only counts if it finds its way to the same identifier: through the customer account or the same browser. Someone who orders without an account on another device appears as a new customer.
- New-customer cost belongs to the month of the first purchase, not to the individual. A cohort from a month with an expensive campaign carries its cost, including for customers who came without advertising.
- New-customer cost and payback need ad spend, and costs come with the Pro plan. Contribution margin needs the cost of goods of your orders.
- How costs are spread over new customers depends on the chosen attribution model. Name it when you pass the figure on.
Idea clave
In the example, €50 of new-customer cost is earned back after five months. Without the months that follow it would just be a high number.