Customer Acquisition Cost (CAC)

Customer Acquisition Cost is a financial metric that measures the total expense required to acquire a new customer, calculated by dividing marketing and sales expenses by the number of new customers gained during a specific period. Organizations apply this metric by tracking spending across advertising, sales team salaries, tools, and promotional activities, then benchmarking results against industry standards and company targets. This metric is used to evaluate marketing efficiency, inform pricing strategies, and determine whether a business model is economically viable and scalable.

Customer Acquisition Cost (CAC) sits under Business Model Design in the Entrepreneurship & Venture domain of the Luminid skills catalogue.

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