Demystifying the Customer Acquisition Cost

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tech.coFor many small and medium sized businesses (SMB), the customer acquisition cost (CAC) is a vague term. But it’s one of several metrics that can help manage a growing business. The simplest way to look at it in layman terms is for (x) paying customers in a period how much in marketing/sales (y) in same period did the business spend?

One might ask why does it matter especially for early stage businesses who are experimenting to achieve product market fit. Marc Andreessen famously emphasized ‘the only thing that matters is getting to product market fit’.

 

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