Customer Acquisition Cost (CAC)

What Is Customer Acquisition Cost (CAC)?

It is calculated by dividing the total cost of customer acquisition (marketing, sales, etc.) by the number of customers acquired during the period.

How To Calculate Customer Acquisition Cost (CAC)?

CAC = Total Customer Acquisition Cost / No. of Customers Acquired

An Example Of Customer Acquisition Cost (CAC)

A company spends $10,000 on customer acquisition and acquires 100 new customers in a month.

CAC = $10,000 / 100 = $100

So, the Customer Acquisition Cost for each new customer here is $100.

Insights About Customer Acquisition Cost (CAC)

Understanding CAC helps businesses evaluate the effectiveness of their marketing and sales strategies and determine the return on investment for acquiring new customers.