Alphabetical TOC
- Customer Acquisition Cost (CAC)
- Cost Per Action (CPA)
Customer Acquisition Cost (CAC)
How much it costs to acquire an individual paying customer. As with most everything, you should set a time period on it.
April CAC = total marketing cost (April) / total new customers (April)
“I spent $20,000 on marketing in April and acquired 200 new customers. My CAC for April was $100”
I also like to generate a CAC per channel so that I can measure the cost of each channel. E.g. “Adwords had a CAC of $10 in April and Facebook had a CAC of $20 in April.
Further Reading:
Ometria (Beginner)
Neil Patel (Intermediate)
David Skok (Advanced)
Cost Per Action (CPA)
Cost per Action vs Cost per Acquisition
LTV to CAC Ratio
Gross Profit
Further Reading: Investopedia
Gross Profit Margin
Further Reading: Investopedia
Return on Ad Spend (ROAS)
Revenue from a campaign or ad divided by the amount spent. Can be expressed as a dollar value or as a percent.
Revenue / cost
“I spent $100 on that Facebook campaign and it generated $500 in revenue. My ROAS was 500%. For every $1 I put in, I got $5.
Related: Return on Investmen (ROI)
Further Reading: Disruptive Advertising
See also: Customer Acquisition Cost (CAC)
Return on Investment (ROI)
The money you get divided
Related: Return on Ad Spend (ROAS)
Further Reading: Investopedia
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