Customer Acquisition Cost or CAC, determines the resources that are needed for a company to attract new customers and continue its growth.

But how is CAC calculated? Learn it in 3 simple steps.

Step 1: To calculate customer acquisition cost, the first step is to determine the time period that you're evaluating for.

Step 2: Note down your total marketing and sales expenses during that period.

Step 3: Add both, and divide that total by the number of new customers acquired during the same time period.

The result value should be your company's estimated cost of acquiring a new customer.

The example in the video will surely help you understand it better.

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