Published in CAC,XR,ROI,E-commerce
Image credit by Argo
Sophie
May 7, 2025
The Rising Cost of Customer Acquisition: How WebAR is Revolutionising E-commerce ROI
In the face of the constant rise in customer acquisition costs (CAC) in e-commerce, where B2B companies spend between 15-20% of their revenues and B2C companies up to 15.9%, Web-based Augmented Reality (WebAR) emerges as a promising strategic solution. This browser-accessible technology, expected to reach around 1.73 billion users by the end of 2024, can enhance engagement by up to 37 times and conversions by up to 40%, as demonstrated by the successes of Home Depot and Rebecca Minkoff, thereby providing companies with an effective way to reduce their CAC while improving the customer experience through features such as virtual try-ons, 3D visualisation, and product placement in real environments.
In the competitive landscape of today's e-commerce, one metric has become increasingly crucial for determining the sustainability and profitability of businesses: Customer Acquisition Cost (CAC). As digital advertising platforms become more saturated and consumer attention more fragmented, the cost of acquiring new customers continues to rise, putting pressure on profit margins and questioning the very economics of online commerce.
The Growing Challenge of CAC in E-commerce
Customer Acquisition Cost represents the total amount spent by businesses to acquire a new customer, encompassing all marketing and sales expenses divided by the number of new customers acquired over a specific period. For e-commerce directors and marketing managers, this metric has become a critical focal point as it directly impacts the scalability and profitability of the business.
The cost structure varies significantly across different sectors, with B2B e-commerce companies spending an average of $274 to acquire a new customer, while some fintech companies may invest up to $1,450 per new customer. These figures underscore the substantial investment needed to attract buyers in today’s digital marketplace.
The Rising Tide of Acquisition Costs
Recent data shows troubling trends for online retailers. According to Wordstream, the average cost per click (CPC) on Google increased by 10% between 2023 and 2024, compared to just 2% the year before. Some sectors have seen even larger increases, with clothing, fashion, and jewelry experiencing CPC hikes of 24.6% year over year.
Industry analyses confirm that B2B e-commerce brands typically spend between 15% and 20% of their revenue on customer acquisition, with some allocating as much as 30% of their revenue to secure new customers. Meanwhile, B2C e-commerce companies invest up to 15.9% of their revenue for the same purpose.
These rising costs create a challenging equation for e-commerce businesses:
Higher acquisition costs → Reduced profit margins
Increased competition → Greater advertising spend required
Privacy changes → Reduced targeting efficiency
Economic uncertainty → Consumers more price-sensitive
The most effective way for e-commerce businesses to maintain healthy profits is to aim for a CAC/LTV (Customer Lifetime Value) ratio of around 3:1. This means that each customer should generate approximately three times more revenue over their lifetime than it cost to acquire them.
The WebAR Revolution: A Path to Lower CAC
As acquisition costs continue to rise, innovative e-commerce brands are turning to Web-Based Augmented Reality (WebAR) as a strategic solution. Unlike traditional AR that requires app downloads, WebAR offers immersive experiences directly through web browsers, making it accessible to almost all smartphone users.
Recent projections estimate that by the end of 2024, there will be around 1.73 billion mobile AR users worldwide. Despite this massive potential audience, only about 15% of online retailers currently leverage AR technology. This represents both a challenge and an opportunity for visionary e-commerce brands.
The Impressive Impact of WebAR on Key Metrics
The data supporting the effectiveness of WebAR is compelling:
Marketing Dive reports that web AR products can increase online shopping conversion rates by nearly 30%. Even more impressively, data from Shopify indicates that products with AR content achieve conversion rates 94% higher than those without AR.
Home Depot found that its AR-enabled products converted at rates 2 to 3 times higher than products without AR capabilities. Similarly, fashion retailer Rebecca Minkoff discovered that customers were 44% more likely to add items to their cart after interacting with them in AR, and 27% more likely to place an order.
E-commerce companies using AR technology can increase conversions by up to 40%, offering significant growth potential that will only expand as AR adoption increases among consumers.
How WebAR Addresses the CAC Challenge
WebAR offers several distinct advantages that directly impact customer acquisition costs:
Higher Engagement Rates AR e-commerce experiences are 200% more engaging than their non-AR counterparts, creating more memorable and interactive shopping experiences. This increased engagement translates to better conversion rates without requiring additional advertising spend.
Improved Conversion Rates By allowing customers to visualize products in their own environment before purchase, WebAR removes a significant barrier to online shopping. According to XR Today, 57% of customers say they are more likely to buy from a brand that uses AR.
Reduced Return Rates When customers can accurately visualize products before purchase, return rates decrease significantly. Lower returns mean better profit margins and higher customer satisfaction, improving both initial conversion and long-term loyalty.
Enhanced Customer Trust Rebecca Minkoff discovered that by strengthening customer trust with augmented reality experiences, their customers were 65% more likely to place an online order. Higher trust means less hesitation in the purchasing journey.
Implementing WebAR: Strategic Considerations
For e-commerce directors looking to leverage WebAR to reduce CAC while maintaining or improving results, several approaches prove effective:
1. Virtual Try-On Experiences
Allowing customers to visualize how products would look on them or in their environments. This is particularly effective for:
Cosmetics and beauty products
Fashion items and accessories
Furniture and home decor
Glasses and jewelry
2. Interactive Product Visualization
Allowing customers to explore products from all angles and understand the features and benefits in an immersive way:
View products in 3D from all angles
Explore internal components
Test different configurations and customizations
3. Home Placement
Helping customers visualize products in their own space:
Furniture and home decor
Major appliances
Electronics
Art and wall decor
4. QR Code Integration
QR codes have become increasingly common, making them an excellent gateway to WebAR experiences. Brands can implement QR codes on packaging, in-store displays, print ads, and even on product pages to activate WebAR showcases or virtual try-on experiences.
The Economic Argument for Investing in WebAR
When evaluating the business case for WebAR, consider a hypothetical scenario: If your business currently spends $50,000 on marketing to acquire 500 customers (a CAC of $100), implementing changes that include WebAR could potentially increase that number to 800 customers with the same budget, reducing your CAC to $62.50 — a significant improvement.
This improvement in acquisition efficiency creates a compelling ROI argument for implementing WebAR, especially when combined with the additional benefits of higher average order values and better customer retention.
Conclusion: The Strategic Imperative of WebAR
As customer acquisition costs continue to rise and competition in the e-commerce space intensifies, WebAR represents not just a technological novelty but a strategic imperative for brands seeking sustainable growth.
The data clearly demonstrates that WebAR can offer:
Higher user engagement (up to 37 times more engagement)
Improved conversion rates (up to 40% higher)
Better customer retention
Enhanced lead conversion
For e-commerce directors and marketing executives facing the challenge of rising CAC, WebAR offers a credible path to maintain healthy acquisition costs while delivering the immersive, trust-building experiences that today’s digital consumers increasingly expect.
As technology becomes more accessible and consumer adoption rises, the question is no longer whether to implement WebAR, but how quickly it can be integrated into the customer journey to gain a competitive advantage in an increasingly challenging acquisition landscape.
This article uses the latest statistics from industry research conducted through 2025, including data from Deloitte, Shopify, Marketing Dive, and other authoritative sources in e-commerce and augmented reality.
In the competitive landscape of today's e-commerce, one metric has become increasingly crucial for determining the sustainability and profitability of businesses: Customer Acquisition Cost (CAC). As digital advertising platforms become more saturated and consumer attention more fragmented, the cost of acquiring new customers continues to rise, putting pressure on profit margins and questioning the very economics of online commerce.
The Growing Challenge of CAC in E-commerce
Customer Acquisition Cost represents the total amount spent by businesses to acquire a new customer, encompassing all marketing and sales expenses divided by the number of new customers acquired over a specific period. For e-commerce directors and marketing managers, this metric has become a critical focal point as it directly impacts the scalability and profitability of the business.
The cost structure varies significantly across different sectors, with B2B e-commerce companies spending an average of $274 to acquire a new customer, while some fintech companies may invest up to $1,450 per new customer. These figures underscore the substantial investment needed to attract buyers in today’s digital marketplace.
The Rising Tide of Acquisition Costs
Recent data shows troubling trends for online retailers. According to Wordstream, the average cost per click (CPC) on Google increased by 10% between 2023 and 2024, compared to just 2% the year before. Some sectors have seen even larger increases, with clothing, fashion, and jewelry experiencing CPC hikes of 24.6% year over year.
Industry analyses confirm that B2B e-commerce brands typically spend between 15% and 20% of their revenue on customer acquisition, with some allocating as much as 30% of their revenue to secure new customers. Meanwhile, B2C e-commerce companies invest up to 15.9% of their revenue for the same purpose.
These rising costs create a challenging equation for e-commerce businesses:
Higher acquisition costs → Reduced profit margins
Increased competition → Greater advertising spend required
Privacy changes → Reduced targeting efficiency
Economic uncertainty → Consumers more price-sensitive
The most effective way for e-commerce businesses to maintain healthy profits is to aim for a CAC/LTV (Customer Lifetime Value) ratio of around 3:1. This means that each customer should generate approximately three times more revenue over their lifetime than it cost to acquire them.
The WebAR Revolution: A Path to Lower CAC
As acquisition costs continue to rise, innovative e-commerce brands are turning to Web-Based Augmented Reality (WebAR) as a strategic solution. Unlike traditional AR that requires app downloads, WebAR offers immersive experiences directly through web browsers, making it accessible to almost all smartphone users.
Recent projections estimate that by the end of 2024, there will be around 1.73 billion mobile AR users worldwide. Despite this massive potential audience, only about 15% of online retailers currently leverage AR technology. This represents both a challenge and an opportunity for visionary e-commerce brands.
The Impressive Impact of WebAR on Key Metrics
The data supporting the effectiveness of WebAR is compelling:
Marketing Dive reports that web AR products can increase online shopping conversion rates by nearly 30%. Even more impressively, data from Shopify indicates that products with AR content achieve conversion rates 94% higher than those without AR.
Home Depot found that its AR-enabled products converted at rates 2 to 3 times higher than products without AR capabilities. Similarly, fashion retailer Rebecca Minkoff discovered that customers were 44% more likely to add items to their cart after interacting with them in AR, and 27% more likely to place an order.
E-commerce companies using AR technology can increase conversions by up to 40%, offering significant growth potential that will only expand as AR adoption increases among consumers.
How WebAR Addresses the CAC Challenge
WebAR offers several distinct advantages that directly impact customer acquisition costs:
Higher Engagement Rates AR e-commerce experiences are 200% more engaging than their non-AR counterparts, creating more memorable and interactive shopping experiences. This increased engagement translates to better conversion rates without requiring additional advertising spend.
Improved Conversion Rates By allowing customers to visualize products in their own environment before purchase, WebAR removes a significant barrier to online shopping. According to XR Today, 57% of customers say they are more likely to buy from a brand that uses AR.
Reduced Return Rates When customers can accurately visualize products before purchase, return rates decrease significantly. Lower returns mean better profit margins and higher customer satisfaction, improving both initial conversion and long-term loyalty.
Enhanced Customer Trust Rebecca Minkoff discovered that by strengthening customer trust with augmented reality experiences, their customers were 65% more likely to place an online order. Higher trust means less hesitation in the purchasing journey.
Implementing WebAR: Strategic Considerations
For e-commerce directors looking to leverage WebAR to reduce CAC while maintaining or improving results, several approaches prove effective:
1. Virtual Try-On Experiences
Allowing customers to visualize how products would look on them or in their environments. This is particularly effective for:
Cosmetics and beauty products
Fashion items and accessories
Furniture and home decor
Glasses and jewelry
2. Interactive Product Visualization
Allowing customers to explore products from all angles and understand the features and benefits in an immersive way:
View products in 3D from all angles
Explore internal components
Test different configurations and customizations
3. Home Placement
Helping customers visualize products in their own space:
Furniture and home decor
Major appliances
Electronics
Art and wall decor
4. QR Code Integration
QR codes have become increasingly common, making them an excellent gateway to WebAR experiences. Brands can implement QR codes on packaging, in-store displays, print ads, and even on product pages to activate WebAR showcases or virtual try-on experiences.
The Economic Argument for Investing in WebAR
When evaluating the business case for WebAR, consider a hypothetical scenario: If your business currently spends $50,000 on marketing to acquire 500 customers (a CAC of $100), implementing changes that include WebAR could potentially increase that number to 800 customers with the same budget, reducing your CAC to $62.50 — a significant improvement.
This improvement in acquisition efficiency creates a compelling ROI argument for implementing WebAR, especially when combined with the additional benefits of higher average order values and better customer retention.
Conclusion: The Strategic Imperative of WebAR
As customer acquisition costs continue to rise and competition in the e-commerce space intensifies, WebAR represents not just a technological novelty but a strategic imperative for brands seeking sustainable growth.
The data clearly demonstrates that WebAR can offer:
Higher user engagement (up to 37 times more engagement)
Improved conversion rates (up to 40% higher)
Better customer retention
Enhanced lead conversion
For e-commerce directors and marketing executives facing the challenge of rising CAC, WebAR offers a credible path to maintain healthy acquisition costs while delivering the immersive, trust-building experiences that today’s digital consumers increasingly expect.
As technology becomes more accessible and consumer adoption rises, the question is no longer whether to implement WebAR, but how quickly it can be integrated into the customer journey to gain a competitive advantage in an increasingly challenging acquisition landscape.
This article uses the latest statistics from industry research conducted through 2025, including data from Deloitte, Shopify, Marketing Dive, and other authoritative sources in e-commerce and augmented reality.
In the competitive landscape of today's e-commerce, one metric has become increasingly crucial for determining the sustainability and profitability of businesses: Customer Acquisition Cost (CAC). As digital advertising platforms become more saturated and consumer attention more fragmented, the cost of acquiring new customers continues to rise, putting pressure on profit margins and questioning the very economics of online commerce.
The Growing Challenge of CAC in E-commerce
Customer Acquisition Cost represents the total amount spent by businesses to acquire a new customer, encompassing all marketing and sales expenses divided by the number of new customers acquired over a specific period. For e-commerce directors and marketing managers, this metric has become a critical focal point as it directly impacts the scalability and profitability of the business.
The cost structure varies significantly across different sectors, with B2B e-commerce companies spending an average of $274 to acquire a new customer, while some fintech companies may invest up to $1,450 per new customer. These figures underscore the substantial investment needed to attract buyers in today’s digital marketplace.
The Rising Tide of Acquisition Costs
Recent data shows troubling trends for online retailers. According to Wordstream, the average cost per click (CPC) on Google increased by 10% between 2023 and 2024, compared to just 2% the year before. Some sectors have seen even larger increases, with clothing, fashion, and jewelry experiencing CPC hikes of 24.6% year over year.
Industry analyses confirm that B2B e-commerce brands typically spend between 15% and 20% of their revenue on customer acquisition, with some allocating as much as 30% of their revenue to secure new customers. Meanwhile, B2C e-commerce companies invest up to 15.9% of their revenue for the same purpose.
These rising costs create a challenging equation for e-commerce businesses:
Higher acquisition costs → Reduced profit margins
Increased competition → Greater advertising spend required
Privacy changes → Reduced targeting efficiency
Economic uncertainty → Consumers more price-sensitive
The most effective way for e-commerce businesses to maintain healthy profits is to aim for a CAC/LTV (Customer Lifetime Value) ratio of around 3:1. This means that each customer should generate approximately three times more revenue over their lifetime than it cost to acquire them.
The WebAR Revolution: A Path to Lower CAC
As acquisition costs continue to rise, innovative e-commerce brands are turning to Web-Based Augmented Reality (WebAR) as a strategic solution. Unlike traditional AR that requires app downloads, WebAR offers immersive experiences directly through web browsers, making it accessible to almost all smartphone users.
Recent projections estimate that by the end of 2024, there will be around 1.73 billion mobile AR users worldwide. Despite this massive potential audience, only about 15% of online retailers currently leverage AR technology. This represents both a challenge and an opportunity for visionary e-commerce brands.
The Impressive Impact of WebAR on Key Metrics
The data supporting the effectiveness of WebAR is compelling:
Marketing Dive reports that web AR products can increase online shopping conversion rates by nearly 30%. Even more impressively, data from Shopify indicates that products with AR content achieve conversion rates 94% higher than those without AR.
Home Depot found that its AR-enabled products converted at rates 2 to 3 times higher than products without AR capabilities. Similarly, fashion retailer Rebecca Minkoff discovered that customers were 44% more likely to add items to their cart after interacting with them in AR, and 27% more likely to place an order.
E-commerce companies using AR technology can increase conversions by up to 40%, offering significant growth potential that will only expand as AR adoption increases among consumers.
How WebAR Addresses the CAC Challenge
WebAR offers several distinct advantages that directly impact customer acquisition costs:
Higher Engagement Rates AR e-commerce experiences are 200% more engaging than their non-AR counterparts, creating more memorable and interactive shopping experiences. This increased engagement translates to better conversion rates without requiring additional advertising spend.
Improved Conversion Rates By allowing customers to visualize products in their own environment before purchase, WebAR removes a significant barrier to online shopping. According to XR Today, 57% of customers say they are more likely to buy from a brand that uses AR.
Reduced Return Rates When customers can accurately visualize products before purchase, return rates decrease significantly. Lower returns mean better profit margins and higher customer satisfaction, improving both initial conversion and long-term loyalty.
Enhanced Customer Trust Rebecca Minkoff discovered that by strengthening customer trust with augmented reality experiences, their customers were 65% more likely to place an online order. Higher trust means less hesitation in the purchasing journey.
Implementing WebAR: Strategic Considerations
For e-commerce directors looking to leverage WebAR to reduce CAC while maintaining or improving results, several approaches prove effective:
1. Virtual Try-On Experiences
Allowing customers to visualize how products would look on them or in their environments. This is particularly effective for:
Cosmetics and beauty products
Fashion items and accessories
Furniture and home decor
Glasses and jewelry
2. Interactive Product Visualization
Allowing customers to explore products from all angles and understand the features and benefits in an immersive way:
View products in 3D from all angles
Explore internal components
Test different configurations and customizations
3. Home Placement
Helping customers visualize products in their own space:
Furniture and home decor
Major appliances
Electronics
Art and wall decor
4. QR Code Integration
QR codes have become increasingly common, making them an excellent gateway to WebAR experiences. Brands can implement QR codes on packaging, in-store displays, print ads, and even on product pages to activate WebAR showcases or virtual try-on experiences.
The Economic Argument for Investing in WebAR
When evaluating the business case for WebAR, consider a hypothetical scenario: If your business currently spends $50,000 on marketing to acquire 500 customers (a CAC of $100), implementing changes that include WebAR could potentially increase that number to 800 customers with the same budget, reducing your CAC to $62.50 — a significant improvement.
This improvement in acquisition efficiency creates a compelling ROI argument for implementing WebAR, especially when combined with the additional benefits of higher average order values and better customer retention.
Conclusion: The Strategic Imperative of WebAR
As customer acquisition costs continue to rise and competition in the e-commerce space intensifies, WebAR represents not just a technological novelty but a strategic imperative for brands seeking sustainable growth.
The data clearly demonstrates that WebAR can offer:
Higher user engagement (up to 37 times more engagement)
Improved conversion rates (up to 40% higher)
Better customer retention
Enhanced lead conversion
For e-commerce directors and marketing executives facing the challenge of rising CAC, WebAR offers a credible path to maintain healthy acquisition costs while delivering the immersive, trust-building experiences that today’s digital consumers increasingly expect.
As technology becomes more accessible and consumer adoption rises, the question is no longer whether to implement WebAR, but how quickly it can be integrated into the customer journey to gain a competitive advantage in an increasingly challenging acquisition landscape.
This article uses the latest statistics from industry research conducted through 2025, including data from Deloitte, Shopify, Marketing Dive, and other authoritative sources in e-commerce and augmented reality.
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