What is CAC (Customer Acquisition Cost)?
Customer Acquisition Cost (CAC) is the total amount a company spends to acquire a new customer. It includes all marketing, advertising, sales, and promotional expenses divided by the number of customers acquired (gained).
For example, if a business spends $1,000 on marketing and gets 50 new customers, the CAC would be $20 per customer. Knowing CAC helps businesses understand if their spending is efficient and if they’re making enough profit from new customers.
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