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Foundation · Customers and growth

Customers and growth: the economics of marketing

Marketing as numbers, not slogans: which customers are worth the most, why they choose you and what they would pay, how a funnel turns people into repeat buyers, why keeping customers beats winning new ones, what each sales channel really costs, how to tell whether marketing spend paid for itself, what a brand is worth, and how to use all of it in growth and new product cases.

88 min8 lessons Facts checked against sources on
Start lesson 1 Who the customer is: segments by need and by value

Key takeaways

  • A segment is a group of customers who want the same thing and are worth about the same to you.
  • A customer chooses you when you leave them better off than their next best option.
  • A funnel follows people from first contact to repeat purchase. Each stage keeps a share of the one before, so the rates multiply: five stages that each keep half leave about 3 percent.
  • A business that wins the same number of customers each month and loses a steady share settles at a size of new customers divided by the monthly churn rate.
  • A channel is the route a product takes to the customer. Every channel keeps part of the price or charges you to serve the customer yourself.
By the end you will be able to
  • Split customers into segments by need and by value, and find the segment that earns the profit
  • Work out the most a customer should pay from the value you create against their next best option
  • Build a funnel from reach to repeat purchase and find the stage worth fixing
  • Read a cohort table and explain why retention usually beats acquisition
  • Compare what direct, retail, marketplace, distributor and sales team channels keep from each sale
  • Judge marketing spend on incremental return, not last-click credit
  • Put a number on a brand: its price premium and its repeat rate
  • Build the structure for a growth or new product case from the customer maths

Lessons

1

Who the customer is: segments by need and by value

Split customers by why they buy and by what they are worth, with a worked example where the biggest group earns the least.

10 min
2

Positioning and why customers choose: value to the customer and willingness to pay

Why a customer picks you over the next best option, and how to work out the most they should pay.

10 min
3

The funnel and conversion maths: reach, consideration, trial and repeat

How a market of people narrows into repeat buyers, why the stage rates multiply, and how to find the stage worth fixing.

11 min
4

Retention and cohorts: why keeping customers beats winning them

How a customer base settles at new customers divided by churn, how to read cohort curves, and why retention usually beats acquisition.

11 min
5

Channel economics across industries: direct, retail, marketplaces, distributors and sales teams

What each route to the customer keeps from the price, what it costs you, and when it is worth it, with real fee and margin figures.

12 min
6

Marketing return: CAC, payback, incrementality, and why last-click credit misleads

How to tell whether marketing spend paid for itself: blended and paid CAC, marginal CAC, break-even return, and incremental tests.

12 min
7

Brand economics: the price premium and the repeat rate

What a brand is worth in money: a higher price, more repeat buying and cheaper customers, measured against the store brand.

10 min
8

Using this in a case: growth and new product cases

What to ask, what to calculate and what to say when a case is about winning customers, growing sales or launching something new.

12 min

Worked cases in this module

Look it up

Key terms