CAC

Customer Acquisition Cost (CAC) refers to the amount of money a business spends on acquiring a new customer. This includes all the expenses involved in marketing, sales, and any other efforts that lead to a customer making a purchase. To calculate CAC, simply divide the total costs associated with acquiring customers (such as marketing expenses, sales team salaries, advertising costs, etc.) by the number of customers acquired within a specific period. The CAC formula is: CAC = (Cost of sales + cost of marketing) / New customers acquired For example, if a company spent $10,000 on marketing & sales efforts in a month and acquired 100 new customers during that same period, the CAC would be $100.