Customer Acquisition Cost (CAC): Difference between revisions

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{{infobox | test=foo}}
= Customer Acquisition Cost (CAC)=
Customer Acquisition Cost, CAC, refers to the cost of acquiring a new customer, which includes expenses such as advertising, sales commissions, and other marketing efforts.
Customer Acquisition Cost, CAC, refers to the cost of acquiring a new customer, which includes expenses such as advertising, sales commissions, and other marketing efforts.


== Definition ==
== Definition ==
Sum of all sales (Sx) and marketing expenses (Mx) in the time period (t) divided by the number of new customers (N) acquired in that time period.  
Sum of all sales expenses (S<sub>x</sub>) and marketing expenses (M<sub>x</sub>) in the given time period (<small>&Delta;</small>t) divided by the number of new customers (NC) acquired in that time period.  


<math>
<math>
CAC(t)=Sx+Mx/N
CAC(\Delta t)=\frac{S_x+M_x}N
</math>
</math>


{{RFC_Metric|number=22/0001|title=Customer Acquisition Cost (CAC)|version=0.9|status=proposal|type=metric}}
== Details ==
 
 
;Sales Expenses (S<sub>x</sub>) include
* the wages all of the personnel in Sales, including commissions
* all expenses for tools uses by this personnel
* excluding company-wide tools like email, chat, data storage etc.
 
;Marketing Expenses (M<sub>x</sub>) include
* the wages all of the personnel in Marketing
* all expenses for tools uses by this personnel
* excluding company-wide tools like email, chat, data storage etc.
* including Ad Spend in the given time period <small>&Delta;</small>t


{{RFC_Metric|number=22/0101|title=Customer Acquisition Cost (CAC)|version=0.9|status=draft|type=metric}}
== See also ==
* [[Customer Lifetime Value (CLV)]]
* [[CAC-LTV-Ratio]]


[[Category:Metric]]
[[Category:Metric]]
== Sources ==
* [https://www.productplan.com/glossary/customer-acquisition-cost/ What is Customer Acquisition Cost (CAC)? (productplan.com)]

Latest revision as of 13:49, 8 December 2022

Customer Acquisition Cost, CAC, refers to the cost of acquiring a new customer, which includes expenses such as advertising, sales commissions, and other marketing efforts.

Definition

Sum of all sales expenses (Sx) and marketing expenses (Mx) in the given time period (Δt) divided by the number of new customers (NC) acquired in that time period.

Details

Sales Expenses (Sx) include
  • the wages all of the personnel in Sales, including commissions
  • all expenses for tools uses by this personnel
  • excluding company-wide tools like email, chat, data storage etc.
Marketing Expenses (Mx) include
  • the wages all of the personnel in Marketing
  • all expenses for tools uses by this personnel
  • excluding company-wide tools like email, chat, data storage etc.
  • including Ad Spend in the given time period Δt

Standardization Status

Request for Comments (RFC): 22/0101 - Customer Acquisition Cost (CAC)
Type: metric
Version: 0.9
Status:draft

See also

Sources

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