Scaling Demand
Core Premise: Scaling is not just spending more. The Efficiency Ceiling, Marginal CAC, and the Scaling Decision Framework govern profitable growth.
The Efficiency Ceiling
Every channel has a ceiling: the spend level above which efficiency materially degrades.
Signs you have hit the ceiling: - Marginal CAC increasing - Audience saturation - Creative fatigue accelerating
Marginal vs. Blended CAC
Blended CAC: Total spend / total customers (masks problems) Marginal CAC: Cost of each additional customer (reveals problems)
Scaling decisions should be based on marginal, not blended.
The Scaling Decision Framework
- What is current marginal CAC?
- Are we at or near ceiling?
- What expansion strategies are available?
- What are the risks?
- What will we test first?
Expansion Strategies
Vertical Expansion: New ICP segments Horizontal Expansion: New channels Creative Expansion: New messages/formats Funnel Expansion: Broader top of funnel Efficiency Expansion: Optimize current
The Diversification Imperative
No channel should exceed 60% of spend at scale. Platform changes can destroy concentrated portfolios overnight.