Blended ROAS hides the real cost of acquiring new customers. Repeat purchasers inflate your metrics.
Acquisition budgets may be misallocated by 30-50% between new and returning customers
New Customer CAC, Customer Acquisition Rate, LTV/CAC Ratio, Sustainable Growth Rate
Hidden high CAC for new customers limits sustainable growth. Brands often overspend on remarketing while underinvesting in true acquisition.
Understanding the root causes is the first step to solving the problem.
Google Ads combines new and returning customers in conversion reporting. Easy returning customers inflate metrics.
Multi-touch attribution gives prospecting credit even when remarketing closes. True prospecting impact unclear.
Broad targeting often reaches existing customers, especially in PMax. New reach is less than it appears.
Without explicit new customer conversion actions, you can't optimize for true acquisition.
Well-intentioned fixes that often make things worse.
You optimize toward easy conversions (existing customers) instead of valuable ones (new acquisition).
PMax often reaches existing customers and remarketing lists. New customer percentage is often lower than expected.
New customer acquisition is always less efficient than remarketing. Cutting it stops the funnel.
Purpose-built features to detect, diagnose, and fix new customer acquisition costs.
Estimate new customer percentage by campaign using audience patterns and conversion data.
Calculate new customer acquisition cost separate from blended metrics.
Identify campaigns and keywords that drive true new customer acquisition.
Find where targeting overlaps with existing customers, reducing true prospecting reach.
Best practices to prevent this problem from occurring or recurring.
It varies by business model and campaign type. For prospecting campaigns: 40-60% new. For PMax: often 30-50% new. For brand campaigns: 20-40% new (lots of returning). The key is knowing your number and tracking it over time. If new customer percentage declines, your growth is slowing.
PerfoAds AI identifies, diagnoses, and helps you fix account issues automatically. Start solving problems today.