Resources

 

Customer Acquisition Cost

Customer Acquisition Cost

Customer Acquisition Cost (CAC) is the total expense a business incurs to acquire a new customer. This metric is crucial for understanding how much a company is spending to grow its customer base.

How to Calculate CAC: To calculate CAC, you divide the total marketing and sales expenses by the number of new customers acquired during a specific period.

CAC = (Total Sales & Marketing Costs) / (Number of New Customers Acquired)

Example:
If your sales and marketing expenses for a quarter are $50,000 and you acquired 500 new customers, your CAC would be:

CAC = $50,000 / 500 = $100

This means you spent $100 to acquire each new customer.

Understanding CAC is needed for optimising marketing strategies and ensuring sustainable business growth.

 
 

- this is the best way to stay in the loop -

Submit your email address. It’s what people do to get on our email list. Go ahead.. let's do this!


CAPTCHA