Which channels deliver profitable users?
№ 073 · Channel CAC vs LTV
Definition
MetricAcquisition cost per user vs realized LTV per user, by channel
Unit$ CAC (CPI proxy) and $ LTV per install; ratio LTV/CAC
Scatter with each acquisition channel as a dot, CAC on x-axis, LTV on y-axis. Diagonal lines show LTV/CAC ratios. Build by computing per-channel CAC and LTV. Top-left dots are gold; bottom-right are leaks. Example: Meta at ($3.20, $9.40) = 2.9x; TikTok at ($1.80, $3.20) = 1.8x.
- CAC
- Customer acquisition cost. Fully loaded sales and marketing spend in a period divided by new customers won in that period.
- LTV
- Lifetime value. Average gross profit per customer per period divided by that period churn rate, or summed over expected life.
- LTV/CAC
- Lifetime value to acquisition cost ratio. LTV divided by CAC. Above 3x is the common health threshold.
Benchmarks
| Bottom 30% | Median | Top 30% |
|---|---|---|
| LTV/CAC below 1 at 12 months | Blended global CPI roughly $1-2 (iOS $3.83-5.84, Android $0.66-1.92 depending on source and quarter) against a median 12-month install LTV of ~$0.84, so the median paid channel sits near or below water and survives on the top cohorts; sustainable programs run 1.5-3x | LTV/CAC of 3+ on the channel's mature cohorts |
Paid UA channels for consumer apps, per-install basis, global 2025-2026. CAC side from CPI datasets (AppsFlyer, Business of Apps, Segwise, AdAction); LTV side from subscription datasets (Adapty, RevenueCat). CPI understates true CAC: creative, tooling and team cost typically add 15-30%. · No large public dataset publishes matched CAC-and-LTV pairs per channel; this card pairs two independent benchmark families, which is honest but approximate. Platform and geo spreads dominate: iOS CPI runs ~3x Android while monetizing up to 5x in some categories, so a channel scatter that ignores platform mix misleads.
| Category | Bottom 30% | Median | Top 30% |
|---|---|---|---|
| By platform | iOS broad targeting in competitive verticals, $8+ effective CPI | iOS CPI $3.83-5.84, ~3x Android; iOS monetizes up to 5x in some categories | Android CPI $0.66-1.92 with Tier 1 geo targeting |
| By geography | premium-geo CPIs paired with global-median LTV, ratio under 0.5 | NA $2.50-5.30, EMEA $2.00-4.00, APAC $1.50-3.00 | LATAM / SEA volume plays $0.30-2.00 CPI where LTV holds |
When it looks bad
Spend concentrating in the cheap-CAC corner of the scatter while those channels sit below the breakeven diagonal, and the one channel above the diagonal stays budget-capped.
70% of spend on a $1.10 CPI channel returning $0.60 at 12 months, while a $3.80 CPI search channel returning $8+ receives 15% of budget.
What to do about it
- Re-rank every channel on D30 and D90 cohort revenue per install, not CPI; cheap installs with empty cohorts are the standard failure mode this chart exists to catch (AdAction).
- Do the ASO work before scaling any paid channel; store conversion improvements can cut blended CPI by roughly 35% at unchanged bids, which moves every point on the scatter left (Digital Applied aggregate).
- Set platform-specific targets: iOS CPI runs ~3x Android but can monetize up to 5x in some categories, so a single blended CAC target misprices both platforms (Digital Applied, AppsFlyer via aggregation).
- Kill channels below 1.0 LTV/CAC at month 6 unless a measured referral or network effect justifies the subsidy, and force that justification to be quantified, not asserted.
Sources
- AppsFlyer Average CPI North America $5.30 vs LATAM $0.30; broader channels command different CPIs than niche ones appsflyer.com ↗
- Digital Applied Q1 2026 average CPI $5.84 iOS (+19% YoY) vs $1.92 Android (+8%); global install ad spend $94B; ASO conversion work can cut blended CPI ~35% at unchanged bids digitalapplied.com ↗
- Business of Apps Persistent iOS vs Android CPI gap by genre; casual games around $1.5 on Android with iOS materially higher businessofapps.com ↗
- Insert Affiliate Category CPIs from under $1 to $26.81 (sports highest); geo bands NA $2.50-5.00, EMEA $2.00-4.00, APAC $1.50-3.00, LATAM $0.50-2.00; Apple Search Ads median cost-per-tap $2.05 (shopping) insertaffiliate.com ↗
- AdAction Teams that track CPI without D7/D30/D90 cohort value systematically shift budget to cheap-install channels with empty cohorts adaction.com ↗
- Adapty Average 12-month install LTV $0.84 globally; North America roughly 2x global, which resets channel viability by geo adapty.io ↗
- Segwise Global mobile CPI rose 8.4% to $1.12 blended, iOS near $3.83 and Android near $0.66 segwise.ai ↗