Customer acquisition cost (CAC)
DefinitionGrowth
Customer acquisition cost (CAC)
Customer acquisition cost: total acquisition spend divided by the number of new customers it produced in the period. The metric is only as honest as its numerator - count creative, agency and discount costs, not just media.
Evidence from the library
-$29The average US brand loses money on every new customer it acquires.StatBrand creates value through cheaper acquisition, more value per customer, and a moatPrincipleA pre-purchase 'how did you hear about us' survey is the cheapest brand attribution toolPrincipleBusy Work = 38% of campaignsAdvertising Planning Matrix - Growth Engine, Cult Hit, Paid Noise, Busy WorkPrinciple£3.4m → £37.1mCreative quality explained ten times more category value than advertising weight aloneCase
Source
Marketing Definitions
standard growth and unit-economics practice