Customer acquisition cost (CAC)
CAC is the average cost to acquire one customer, calculated as total acquisition spend divided by the number of customers gained.
CAC is the cost side of unit economics. It differs from cost per lead by the close rate: CAC equals cost per lead divided by the share of leads that become customers, so a cheap lead with a poor close rate can hide an expensive CAC.
CAC only means something against value. Compared to lifetime value it shows whether acquisition is profitable, and its payback period shows how quickly the spend is recovered — both are needed to judge whether to scale.
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