Customer Acquisition Cost (CAC)

Average cost incurred to acquire a new customer

CAC = Total Marketing & Sales Expenses ÷ Number of New Customers Acquired

Customer Acquisition Cost (CAC) represents the total marketing and sales expenses required to acquire a new customer. It is critical for assessing the efficiency of customer acquisition strategies.

Lowering CAC while maintaining or increasing customer quality leads to better profitability. Understanding CAC helps in budgeting and optimizing marketing channels.

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