Customer Acquisition Cost (CAC) is a metric that calculates the total expenses incurred to acquire a new customer, including marketing, sales, and related costs. It’s often measured by dividing the total acquisition expenses by the number of new customers within a period.
Why CAC Matters
CAC helps businesses evaluate the efficiency of their marketing strategies and determine profitability. By keeping CAC low, brands can improve their return on investment and make customer acquisition more sustainable in the long term.