Stop "Peanut-Butter" Budgeting: How to Build a Channel Efficiency Matrix
Most marketing budgets are spread too thin. A little money goes to paid social. A little to events. A slice to SEO, email, partnerships, maybe even a podcast. It feels safe, everyone gets something, no channel is left behind. But this “peanut-butter” budgeting, spreading spend evenly across channels, rarely drives growth. It creates surface-level coverage instead of deep, compounding impact.
The cost? Underperforming campaigns, wasted budget, and channels that never get the chance to prove their true ROI. Worse still, CMOs end up defending spend with activity metrics instead of showing clear efficiency benchmarks the board can trust.
The smarter play? Flip the model. Instead of distributing budget evenly, concentrate it intentionally using a Channel Efficiency Matrix, a framework that benchmarks every channel against three metrics that matter most:
- CAC (Customer Acquisition Cost) – how much it costs to win a new customer through this channel.
- Pipeline per $1 – how much qualified pipeline each dollar of spend creates.
- Payback Period – how long it takes for the revenue from this channel to cover its acquisition costs.
When you stack channels side by side with these metrics, the picture changes. Suddenly, it’s clear which channels are compounding value, which are just breaking even, and which are silently draining budget. Modern marketing doesn’t reward the most evenly distributed budgets. It rewards the most strategically concentrated bets. So how do you move from “everyone gets a slice” to “every dollar earns its keep”? The answer lies in building a Channel Efficiency Matrix. In this guide, we’ll walk you step by step through building your own Channel Efficiency Matrix and give you a downloadable template to run the numbers for your business.
From Peanut Butter to Precision
Instead of asking, “How do I keep stakeholders happy with their share?”, the best CMOs are asking: “Where will the next dollar generate the highest pipeline impact, the fastest payback, and the most efficient customer acquisition?”
That shift, from distributing evenly to investing intentionally, requires three mindset changes:
- Stop thinking in budgets. Start thinking in bets.
- Evaluate channels not only by ROI, but by efficiency and scalability.
- Translate marketing metrics into the language of the board: cost, payback, and pipeline yield.
And guess what! The Channel Efficiency Matrix is the framework to get you there.
What Exactly Is a Channel Efficiency Matrix?
A Channel Efficiency Matrix (CEM) is a tool that helps CMOs allocate budget based on each channel’s efficiency in driving revenue. It moves beyond surface-level metrics like impressions, clicks, or even MQL volume, and forces marketing leaders to ask three harder questions:
- What’s the true Customer Acquisition Cost (CAC) in this channel?
- For every $1 spent, how much qualified pipeline does it create?
- How long does it take for this channel to pay back its investment?
When you plot these measures together, you get a clearer picture of which channels are Core
Why These Three Metrics Matter
Before exploring the “how,” below are the three core concepts every CMO should master:
1. Customer Acquisition Cost (CAC)
CAC is the total cost of acquiring a customer through a given channel. It includes media spend, technology, and people costs.
- Formula:
CAC = Total Spend on Channel / Number of New Customers Acquired
Why it matters: CAC keeps you honest. It prevents mistaking vanity metrics (cheap clicks or inflated leads) for true efficiency.
2. Pipeline per £1
Pipeline per $1 tells you how much qualified pipeline each dollar of spend generates.
- Formula:
Pipeline per $1 = Pipeline Value Generated / Spend on Channel
Why it matters: Boards don’t care about “leads.” They care about pipeline coverage. A channel that delivers $5 in qualified pipeline for every $1 invested is significantly stronger than one that delivers $1.50.
3. Payback Period
The payback period measures how long it takes for the revenue generated from a channel to cover the cost invested in it.
- Formula:
Payback Period = CAC / Gross Margin per Customer
Why it matters: Nowadays, liquidity and speed of return matter as much as ROI. A channel with a 6-month payback is far more attractive than one with a 24-month payback, even if long-term ROI looks similar.
The Four Quadrants of the Channel Efficiency Matrix
When you evaluate channels through the lens of CAC, Pipeline per $1, and Payback Period, they naturally fall into four categories:
- Core Engines: Low CAC, strong pipeline per $1, short payback. These are your workhorses. Scale them aggressively.
- Quick Wins: Low CAC, high pipeline per $1, but limited scalability. Harvest them, but don’t overfeed.
- Growth Bets: High CAC today, but scalable with acceptable payback if optimised. Treat these like venture bets.
- Sinkholes: High CAC, weak pipeline per $1, long payback. Cut them ruthlessly.
This framework removes emotion from budgeting decisions. It’s no longer about which channel owner lobbies hardest. It’s about which channels earn the right to grow.
Step-by-Step: Building Your Channel Efficiency Matrix
Step 1: Define the Metrics That Matter
Anchor your matrix around CAC, Pipeline per $1, and Payback Period. Make it clear to your team and stakeholders: these are the non-negotiable efficiency metrics we’ll use to evaluate every dollar.
Step 2: Collect the Data
Pull spend, pipeline, and revenue attribution data from your CRM, marketing automation, and finance systems. Include:
- Paid media spend
- Agency/tech costs
- Headcount allocation
- Opportunities created
- Closed-won revenue
Accuracy is everything. A Channel Efficiency Matrix built on faulty attribution is like running campaigns with a funnel full of leaks, you’ll never know which dollar is driving results.
Step 3: Score Each Channel
Assign scores on a 1–5 scale for each metric:
- CAC (lower is better)
- Pipeline per $1 (higher is better)
- Payback Period (shorter is better)
This gives you a multi-dimensional view of efficiency.
Step 4: Plot Channels in the Matrix
Visualize each channel in a 2×2 or bubble chart:
- X-axis = Pipeline per $1
- Y-axis = Payback Period
- Bubble size = CAC
This way, you’ll see which channels are compounding value and which are silently draining your budget.
Step 5: Reallocate with Conviction
Armed with the matrix, you can now:
- Double down on Core Engines
- Optimise and cap Quick Wins
- Experiment and monitor Growth Bets
- Divest Sinkholes
This is where leadership comes in. The courage to cut or dramatically reduce a beloved channel is what separates CMOs who manage budgets from those who build growth engines.
A Practical Example
Imagine you’ve mapped five major channels:
Channel | CAC ($) | Pipeline per $1 | Payback Period (Months) | Quadrant |
Paid Search | $2,000 | $6.00 | 6 | Core Engine |
LinkedIn Ads | $3,500 | $3.50 | 12 | Growth Bet |
Events | $5,000 | $1.20 | 24 | Sinkhole |
Webinars | $1,200 | $4.00 | 5 | Quick Win |
Organic SEO | $800 | $7.00 | 4 | Core Engine |
In this scenario:
- Paid Search and SEO are your Core Engines → increase spend.
- Webinars are Quick Wins → great efficiency, but limited scale.
- LinkedIn Ads are a Growth Bet → promising if optimised.
- Events are a Sinkhole → too expensive, too slow.
This clarity transforms budget debates from politics to performance.
Why This Mindset Matters Now
Marketing budgets aren’t growing at the same pace as revenue expectations. Boards want more pipeline with fewer dollars. Sales wants qualified opportunities faster. Finance wants payback sooner. Peanut-butter budgeting can’t deliver that. You can’t starve every channel equally and expect one to magically scale.
The winners in this environment will be the CMOs who reallocate ruthlessly, making tough calls with confidence, and showing the board not just where money is spent but how fast it comes back.
Ask yourself: Would you rather fund ten mediocre plays, or three unstoppable ones?
Key Takeaway
The era of peanut-butter budgeting is over. Tomorrow’s marketing leaders will allocate budgets like portfolio managers, placing concentrated bets where efficiency compounds, divesting from the weak, and moving resources fluidly as market conditions change.
The Channel Efficiency Matrix is more than a framework. It’s a leadership mindset. It signals to your board that marketing is no longer a cost of doing business, it’s a disciplined growth engine that knows how to invest capital with precision.
If this framework resonates, don’t just read, act. Download the template, run the numbers, and build your first Channel Efficiency Matrix. Share your insights with your leadership team. Start conversations in your peer network.
Join the Growth Authority community, a community of CMOs who are moving beyond peanut-butter budgets and rewriting the rules of marketing efficiency. Inside the community, you’ll gain access to the tools, resources, and playbooks that make efficient budget allocation and pipeline impact easier, faster, and more predictable.
Join the Growth Authority community today – https://growthauthority.co.uk/
