CAC stands for “Customer Acquisition Cost.” It is a metric used in business to determine the cost of acquiring a new customer. The CAC is calculated by dividing the total cost of sales and marketing by the number of new customers acquired during a specific period.
In other words, CAC is a measure of how much money a business spends on sales and marketing efforts to acquire a new customer. A high CAC indicates that the business is spending a lot of money to acquire new customers, while a low CAC suggests that the business is acquiring customers at a relatively low cost.
CAC is an important metric for businesses to track, as it helps them determine the efficiency of their sales and marketing efforts. By monitoring CAC, businesses can identify areas where they can reduce costs and optimize their customer acquisition strategy to maximize their return on investment.