The Customer Acquisition Cost (CAC) is a performance indicator used in marketing and business management. It measures the cost required to attract a new customer or convert a prospect into a customer.
To calculate the CAC, simply divide the total marketing and sales costs by the number of new customers acquired during the specified period. For example, if a company spends €10,000 on marketing and sales and manages to acquire 100 new customers in a month, its CAC will be €100 per customer.
The CAC is a key metric for evaluating the effectiveness of the company’s marketing and sales efforts and understanding the costs associated with acquiring new customers. It is important to closely monitor it to ensure that marketing and sales costs remain reasonable and that the company is able to generate profits from its sales activities.