Weekly CAC Review Template for Shopify DTC Operators

CAC Calculation: The Operator Method

Weekly CAC requires consistent input definitions. Use this formula: Total Paid Marketing Spend (7 days) / New Customers Acquired (7 days) = CAC.

Include all costs: ad platform spend (Meta, Google, TikTok), payment processor fees on those transactions, and allocated creative labor if in-house. Exclude organic traffic, email revenue, and affiliate commissions unless those channels drove the acquisition.

Measure new customers, not transactions. If one customer places two orders in the week, count them once. Use your analytics platform's "new customer" metric or query your database for first-time purchasers.

Set a consistent cutoff time. Review every Monday morning using the prior 7 calendar days (Sunday - Saturday). This prevents double-counting and creates a predictable cadence.

Threshold Bands and Decision Rules

CAC thresholds depend on AOV (average order value) and repeat purchase rate. Use this framework:

Green zone: CAC < 25% of AOV. Example: $100 AOV, CAC under $25. Spend can increase.
Yellow zone: CAC 25% - 40% of AOV. Example: CAC $25 - $40. Monitor closely; pause underperforming ad sets.
Red zone: CAC > 40% of AOV. Pause all spend in that channel until root cause is identified.
For repeat-heavy brands (3+ purchases per customer lifetime): CAC can reach 50% of AOV if LTV supports it. Verify LTV math before raising threshold.

The Three Failure Modes

CAC creep happens when weekly CAC drifts up 10% - 15% week-over-week without explanation. Root causes: platform algorithm decay (Meta/Google learning phase ended), audience saturation, or seasonal demand drop. Action: audit audience size, check creative fatigue (frequency > 3), and test new ad creative.

Channel collapse occurs when a single channel (e.g., TikTok) that was 40% of spend suddenly doubles CAC in one week. This signals platform policy change, iOS tracking loss, or competitor bid war. Action: reduce spend 50% immediately, test new audience segment, or shift budget to secondary channels.

Hidden cost blindness happens when platform fees, payment processing, or affiliate payouts aren't included in CAC math. A brand reports $20 CAC but actually spends $26 after fees. Action: audit all cost line items monthly and add them to the weekly formula.

Weekly Review Checklist

Run this checklist every Monday to catch issues early:

Pull CAC for each paid channel (Meta, Google, TikTok, Pinterest, etc.) separately. Do not aggregate.
Compare this week's CAC to last week's CAC. Flag any change > 10%.
Check ad spend vs. budget. If spend is 20%+ below forecast, investigate paused campaigns.
Review new customer count. If it dropped but spend stayed flat, CAC is rising.
Audit creative frequency (average times an ad was shown to one person). If > 3, pause and refresh creative.
Verify AOV hasn't dropped. Lower AOV inflates CAC ratio even if absolute CAC is flat.
Confirm all costs (platform fees, payment processing) are included in the spend total.

Seasonal and Cohort Adjustments

Raw CAC numbers lie during seasonal shifts. Adjust thresholds for predictable periods:

Holiday season (Nov - Dec): CAC can rise 20% - 30% due to increased competition. Raise yellow zone threshold to 35% - 50% of AOV.

Post-holiday slump (Jan - Feb): Demand drops, CAC rises naturally. Reduce spend 15% - 20% or accept higher CAC temporarily.

New product launch: First 2 weeks of spend on a new product will show inflated CAC. Use a separate tracking code and review after week 3.

Cohort CAC: Track CAC by customer source (e.g., "Meta Q4 cohort"). Customers acquired in November may have different LTV than February customers. Review LTV by cohort quarterly.

Escalation and Action Triggers

Define when to escalate or act:

CAC rises > 15% week-over-week: Pause lowest-performing ad set (by ROAS) and test new creative.
CAC exceeds red zone threshold: Reduce spend in that channel by 50% within 24 hours. Investigate before resuming.
New customer count drops > 20% while spend is flat: Audit audience size and check if campaigns are delivery-limited.
AOV drops > 10%: Review product mix and discount strategy. CAC ratio may be misleading.
Payment processor fees spike: Audit transaction volume and fee structure. Negotiate or switch processors if margin impact > 2%.

Reporting and Documentation

Document weekly CAC in a single source of truth. Use a spreadsheet or analytics tool with these columns: Date, Channel, Spend, New Customers, CAC, AOV, CAC % of AOV, Week-over-Week Change, Notes.

Add a notes column for context: "Creative refresh," "Audience expanded," "Platform algorithm update," etc. This builds institutional memory and helps spot patterns.

Share CAC review results with the team every Monday. Include the three channels with highest CAC and the recommended action for each.

Archive weekly reports monthly. Compare month-over-month CAC trends to spot seasonal patterns and validate long-term channel health.

Questions

FAQ

Should CAC include organic traffic or email revenue?

No. CAC measures paid acquisition only. Organic and email are separate channels with different cost structures. If a customer came from organic search, they don't count toward paid CAC. If they came from paid ad, then clicked email later, count them in the week they were acquired via paid.

What if CAC is high but LTV is also high? Is that okay?

Yes, if LTV supports it. Calculate LTV / CAC ratio. If LTV is 3x CAC or higher, the unit economics work. If LTV is 1.5x CAC, the brand is underinvesting in repeat purchase and should focus on retention before scaling acquisition.

How do I handle multi-touch attribution in CAC calculation?

For weekly CAC review, use last-click attribution (the channel that closed the sale). This is simple and consistent. If a customer saw a Meta ad, then clicked a Google search ad, count them in Google's CAC. Multi-touch models are useful for long-term strategy but add noise to weekly reviews.

What's a normal CAC for a DTC Shopify brand?

It depends on AOV and repeat rate. A $50 AOV brand with 1.5x repeat rate should target CAC under $12.50 (25% of AOV). A $150 AOV brand with 3x repeat rate can sustain CAC up to $75 (50% of AOV). Use the threshold bands in this template, not industry benchmarks.

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