BeProfit's app uses Blended Cost Allocation (Blended CAC) for Marketing calculations.
Blended CAC's advantage vs traditional CAC is that it accounts for costs across multiple channels, offering a more comprehensive and practical view of customer acquisition expenses. This enables better resource allocation and decision-making for improved marketing efficiency and ROI.
Marketing cost allocation to orders
Marketing cost can be allocated to orders in two different methods, CAC or CPA.
CAC - Divided evenly and allocated to new customers' orders only. Returning customers' orders will have no Marketing cost.
CPA - Divided evenly and allocated to all orders
You can choose your method in the Calculation Preferences page under Marketing Cost Preferences.
The Marketing cost for each order is based on the set Marketing Cost Preferences and the costs of a specific day.
The daily Marketing costs are divided evenly across the orders of that day.
Marketing cost allocation to products
Marketing cost will be allocated to products of orders that have Marketing cost allocated to them. This means that if Marketing cost is allocated for orders based on CAC, then only products of new customers' orders will have Marketing cost allocated to them.
If an order has Marketing cost allocated to it, then Marketing cost can be allocated to products in two different methods, by Even Allocation or by Selling Price.
Even Allocation - the daily Marketing cost is divided evenly across all products in the order.
Selling Price - the daily Marketing cost is proportionately divided across all products in the order based on their selling price. For example, let's say $100 was spent on Marketing on a specific day and on that day $100 was made from Sales. Assuming that the sale was of 1 order with 2 products. If product📦 costs $40 and product🎁 costs $60, then we allocate 40% of the Marketing cost to product📦 and 60% to product🎁.
You can choose your method in the Calculation Preferences page under Product Cost Allocation Preferences.
