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Research Outline
Prepared for Charlie G. | Delivered February 4, 2020
Customer Acquisition Cost
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Goals
To find information in regard to the cost of acquiring a new customer via Facebook Ads and Google Ads for an e-commerce website that sells walking canes in the U.S. to women aged 50 to 80 years.
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Early Findings
Cost of Customer Acquisition: Facebook Ads and Google Ads
In 2018, Facebook ad spend increased by
50%
year-over-year to
$11.7 billion
.
A survey of advertisers including ad agencies that specialize in Facebook ads revealed that
28%
of respondents have a
customer acquisition cost
(CAC) of less than
$5
.
Another
28%
of respondents to the survey reported a CAC of between
$6-$10
.
The above figures show that more than
50%
of advertisers on Facebook report a CAC that is less than
$10
.
On the extreem end of the scale,
7%
of respondents reported a CAC greater than
$100
. This is not unusual for service industries i.e. B2C and B2B as well as
higher-end consumer goods.
For Google Ads, the average cost per click is between
$1 and $2
.
Fashionable Canes
According to SimilarWeb,
59.3%
of traffic to the Fashionable Canes website comes
from search
.
The company has a total of
374
organic keywords and
116
paid keywords. From the search traffic,
59.41%
comes from organic keywords while
40.59%
comes from paid keywords.
On the other hand,
3.62%
of traffic to the Fashionable Canes websites comes
from social.
The breakdown for the company's social traffic includes: Facebook -
56.3%
, Reddit -
22.54%
, YouTube -
11.76%
, and Pinterest -
9.41%
.
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