Acquisition Economics
Cost per customer, margins and attribution math.
Acquisition Economics
What Is Customer Acquisition Cost?
Customer acquisition cost, or CAC, is the total cost of acquiring one paying customer. It includes advertising spend plus the cost of the sales work required to convert an inquiry. CAC is only meaningful when compared with the gross profit a customer produces.
5 min read
Acquisition Economics
How to Calculate Customer Acquisition Cost for a Service Business
Add all acquisition costs for a period — media spend, sales labor, tools and any acquisition fees — then divide by the number of customers who actually paid in that period. Compare the result to gross profit per customer to determine whether the acquisition is profitable.
6 min read
Acquisition Economics
How to Measure Marketing Revenue Attribution
Store the source on every opportunity at the moment it is created, track it through closed, completed and collected stages, then compare spend to collected revenue by source. Attribution fails when source data is added later or when revenue is reported inconsistently.
6 min read
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