Customer Acquisition Cost Analysis
Calculate and optimize your customer acquisition cost. Learn how to measure CAC and improve marketing efficiency.
Understanding Customer Acquisition Cost
CAC measures how much you spend to acquire each new customer. It's essential for evaluating marketing efficiency and profitability.
Calculating CAC
CAC = Total Marketing and Sales Costs / Number of New Customers Acquired
Include all costs: advertising, content, tools, salaries, and overhead.
CAC by Channel
Calculate CAC for each marketing channel to identify your most efficient acquisition sources.
CAC vs LTV
Compare CAC to Customer Lifetime Value. A healthy ratio is 1:3 (spend $1 to earn $3).
Improving CAC
Increase Conversion Rates: Better targeting and messaging reduce waste.
Optimize Channels: Focus on channels with lower CAC.
Improve Retention: Keeping customers longer improves LTV/CAC ratio.
Tracking CAC Over Time
Monitor CAC trends to identify changes in efficiency and market conditions.
Common Mistakes
- Not including all costs
- Ignoring channel differences
- Focusing only on CAC without considering LTV
- Not tracking CAC regularly