What you see
At the brand’s chosen evaluation age, the acquired cohort has generated less contribution than its assigned acquisition cost.
Check this first
Calculate contribution after variable costs, then compare it with acquisition cost at the same cohort age.
Data needed
- Cohort customers, net revenue, and included variable costs through the chosen age
- Assigned acquisition spend and cost coverage
- The brand evaluation age and acquisition policy, if set
Run the check
- #1
Use net revenue with consistent discount and refund treatment.
- #2
Include the variable costs needed for the stated contribution measure.
- #3
Compare acquisition spend with contribution at a fully observed age.
- #4
If the brand expects later payback, show observed results separately from the forecast.
Calculate
Acquisition surplus at age D = cohort net revenue through D minus variable costs through D minus assigned acquisition spend. Per-customer surplus divides this by acquired customers. Keep overhead and cash timing separate.
Compare groups
- Acquisition cohort
- Channel and source coverage
- Product and offer
- Cost coverage and observation age
What a healthy result looks like
Contribution covers acquisition cost by the brand’s stated payback age, or the planned shortfall remains within a documented budget.
When to investigate
Zero surplus is the mathematical breakeven for the defined costs and age. The acceptable payback age and any early deficit belong to the brand.
Possible causes
- The offer reduces contribution more than acquisition improves.
- Higher spending brings lower-value purchases.
Rule out these explanations
- Missing product, shipping, payment, or return costs
- Immature cohorts
- A planned early deficit with a supported later-payback case
What to do next
Test cost, offer, or acquisition changes where the shortfall is concentrated. Don't scale from reported revenue alone.
What this check can tell you
Observed contribution doesn't establish lifetime value. Missing costs make the result incomplete, not profitable.
Use this check with AI
Run a read-only check for: Acquisition cost exceeds observed customer contribution. First confirm the available sources, columns, row grain, date basis, currency, and customer definition. Use only authorized data. Required inputs: Cohort customers, net revenue, and included variable costs through the chosen age; Assigned acquisition spend and cost coverage; The brand evaluation age and acquisition policy, if set. Check: At the brand’s chosen evaluation age, the acquired cohort has generated less contribution than its assigned acquisition cost. Calculate: Acquisition surplus at age D = cohort net revenue through D minus variable costs through D minus assigned acquisition spend. Per-customer surplus divides this by acquired customers. Keep overhead and cash timing separate. Slice by: Acquisition cohort; Channel and source coverage; Product and offer; Cost coverage and observation age. Use this comparison rule: Zero surplus is the mathematical breakeven for the defined costs and age. The acceptable payback age and any early deficit belong to the brand. Show the source totals, calculation, unknown groups, missing inputs, and result. Don't invent fields, thresholds, customer matches, or causal effects. Rule out: Missing product, shipping, payment, or return costs; Immature cohorts; A planned early deficit with a supported later-payback case. Describe the observed signal separately from possible explanations. If the check is incomplete, state the exact data needed. Make no account or budget changes.
Sources and definitions
- Shopify: profit reportsProduct cost and discounts affect reported gross profit. Acquisition contribution also requires explicitly included variable costs.Read source
- Shopify: customer reportsFirst-purchase history, new versus returning customers, and equal-age cohort comparisons.Read source