The average cost of acquiring new customers
CAC = Total Ad Spend / Number of New Orders
Customer Acquisition Cost (CAC) represents the average amount that it costs you to acquire a new customer. This is a critical metric for your e-commerce business, as you always want to drive down CAC compared to the lifetime value (LTV) of your customers.
CAC (Order) vs CAC (Sign-up)
For CAC (Order), "New Customer," is defined by the date that the customer places their first order.
For CAC (Sign-up), "New Customer," is defined by the date that the customer first signed up and created an account. Instead of dividing by New Orders, you divide by New Sign-ups.
Updated 9 months ago