Calculates the cost incurred to acquire a single customer, taking into account marketing expenses and sales efforts.
The Customer Acquisition Cost (CAC) is an essential metric for businesses to understand how much they are spending to acquire each new customer. This metric helps evaluate the efficiency of your sales and marketing efforts.
Formula: CAC = Total Acquisition Costs / Number of New Customers Acquired
To calculate CAC, divide the total expenses for acquiring customers (including marketing and sales costs) by the number of new customers gained in a specific period. A lower CAC indicates more efficient customer acquisition efforts.