Data: Why did CAC increase +9.7% in April?
This month, we’re sharing our first written monthly breakdown of performance, focusing on aggregate April data across all brands in Northbeam’s dataset. We compared April 2026 performance to April 2025 for brands present in both months, and the results highlight rising costs and declining efficiency.
Key Findings
- Ad spend increased by +9.6% year-over-year (YoY), aligning with IAB predictions.
- Median Customer Acquisition Cost (CAC) rose by +9.7% YoY, nearly matching the spend increase.
- Meta’s March algorithm update prioritized campaigns with 50+ weekly conversions and emphasized creative refresh cadence over targeting, solidifying its impact in April.
- Consumer prices for everyday goods rose 2.4% YoY, contributing to a K-shaped economy where low spenders pull back while wealthy spenders continue spending.
Performance by Ad Spend
We grouped Northbeam advertisers by monthly average media spend and compared median revenue YoY. Smaller spenders saw the most significant declines, validating Meta’s algorithmic changes, which disproportionately affect advertisers with lower budgets.
Key Metric Shifts by Revenue
Businesses with under $5M in annual revenue saw a +14.2% increase in spend but only a +9.6% rise in CAC. Most revenue tiers experienced CAC increases, except for the $100M+ category, which broke even—likely due to stronger brand equity and recession-resistant consumer behavior.
Performance by Average Order Value (AOV)
- Low-AOV products struggled, though they improved Marketing Efficiency Ratio (MER) due to higher headroom.
- High-AOV products faced worse CAC increases, as rising CPM and auction costs compound over longer consideration cycles.
Recommendations by Revenue Tier
- Under $5M: Focus on creative production and adapt to Meta’s algorithmic changes. Maintain high creative volume and ensure event tracking is optimized.
- $5M–$10M: If you’ve mastered one channel, scale to another. Consider Axon for straightforward creative and captive audiences.
- $10M–$20M: If spending $3M–$6M annually on ads, adopt Northbeam or upgrade to Northbeam Incrementality.
- $20M–$50M: If outperforming medians, continue current strategies. If underperforming, consult a Media Strategist.
- $50M–$100M: Follow $20M–$50M strategies, prioritize creative efficiency, and explore Marketing Mix Modeling (MMM). Consider TV if not already active.
- $100M+: Expand internationally for untapped growth opportunities.