The total sales and marketing cost required to earn a new customer over a specific time period is known as Customer Acquisition Cost or CAC.
Customer Acquisition Costs (CAC) are the average recruitment costs that you pay for new customers. This KPI is mainly interesting because it shows you when exactly you recouped the costs of recruiting a customer. For example, bringing in a new customer can cost € 250. If you offer a service that costs € 50 per month, you will have recouped the cost after five months. You can calculate the CAC by adding together the costs of marketing and sales (including salaries) of a month. To calculate the average cost per new customer, divide the CAC by the number of new customers of the period: CAC = (Marketing & Sales costs + Salaries Marketing and Sales) / (Number of new customers) For example: you spent € 5,000 on advertisements and selling costs, and the salary costs were € 7,500 for the same month. When you have acquired 50 new customers, the CAC is: (€ 5,000 + € 7,500) / 50 = € 250 per customer.
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