"The basic concept of LTV>CPA (lifetime value greater than cost to acquire) is pretty simple."

"The idea is to break down overall CPA into spend that attracts new customers, vs. bringing back old customers, and then to break down the major acquisition channels free vs. paid"

"It is important to think about CPA, not CPV (cost per visitor), as the conversion rate from visitor to customer often varies dramatically by channel."

"Don’t include SEM spend on your brand terms within your SEM CPA."

"The only truly free channel is people directly typing in your URL. Other ‘free’ channels (SEO, CRM) have some variable cost which you should account for (although you shouldn’t include the initial investment to put SEO or CRM in place as this is a one time cost)."

"Differentiating between acquisition costs of new vs. returning visitors requires investing time and money into your web analytics system. When you are starting out you won’t have meaningful returning visitors so this doesn’t need to be a priority."

"In an ideal world you would start with the moment where user pays, and track back all the marketing costs from there."

"Usual compromise is to just compare ‘Cost per Sign Up’ across marketing channels."

"What can I realistically reduce my CPA to in each channel in the next year (by getting more sophisticated in SEM, increasing conversion rates)?"

"What can I do to grow volume of acquisitions through my free channels? (pro tip: if you have a customer base the best place to start is CRM). What is a realistic target for this?"

"Typically CPA will start high, go down as you become more sophisticated, then start to creep up as you start looking for volume from less relevant search terms or with broader targeting."

"Common mistake is to take your CPA from highly relevant long tail SEM and assume this will also apply for the most popular ‘head’ terms in the category."

"Start layering in paid acquisition, starting with the cheapest channels, until you hit your maximum budget or CPA creeps up too high."