Unit economicsWhat it means for you.
The revenue and costs of one customer or one sale, used to judge if a business can be profitable.
Growth Score · Unit Economics
Definition
What it means
Unit economics strips the business down to a single unit, such as a customer, and asks whether it earns more than it costs. A healthy business earns back acquisition cost within a reasonable period.
If units lose money, growth only magnifies the loss.
Unit Economics
Why it matters, with an example
It tells you whether more growth makes the business healthier or only makes the loss bigger.
For example: A customer brings $700 of lifetime gross profit and costs $150 to win. Each customer earns $550 after acquisition cost, so growth adds profit.
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Unit Economics
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FAQ
Quick answers
What is Unit economics?
The revenue and costs of one customer or one sale, used to judge if a business can be profitable.
Where does it sit in Growth Score?
It belongs to the Unit Economics pillar, one of the 12 pillars your score is built from.
What should I read next?
Start with Customer lifetime value and Customer acquisition cost, then browse the other terms in Unit Economics.
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