For there to be a business, you need sales, and for there to be sales, you need a funnel that provides you with customers.
There is not much more to it than that. I bet you a coffee that you cannot find an exception to this rule. There
may be some nuances, but if a business works, it is sms gateway japan because there are customers. After all, someone has to pay for the party.
And precisely for all of this, CAC is such an important metric.
What is Customer Acquisition Cost?
Customer Acquisition Cost (or CAC) is the metric that determines how much it costs a business to acquire a new customer.
This metric is so important for most businesses because it helps define which of these 3 scenarios they fall into:
You are managing your marketing budget well.
You are managing your marketing budget sub-optimally.
You're managing your marketing budget poorly and you're headed for bankruptcy.
With those three possibilities, I suspect you now want to know how to calculate it for your company, right?
How to calculate customer acquisition cost?
To calculate CAC, you need to add up all your expenses on customer acquisition activities for a given period (usually a month) by the number of customers you acquired in the same period.
What are the most common errors when calculating CAC?
The only thing worse than making marketing or business decisions without knowing your CAC is making them with the wrong CAC in mind.
And there are 2 super-recurring mistakes that lead people to miscalculate Customer Acquisition Cost:
Not keeping proper records of expenses.
Not counting customers properly.
