Glossary Term
Cost of Customer Acquisition (CAC)
Definition
The Cost of Customer Acquisition (CAC) refers to the total expenses incurred by a company to acquire a new customer. It includes marketing, sales, and operational costs associated with attracting, converting, and onboarding customers. In the MedTech industry, CAC is a critical metric for evaluating the efficiency and profitability of customer acquisition strategies.
Relevance to the MedTech Industry
CAC helps MedTech companies assess the financial sustainability of their customer acquisition efforts. By analyzing CAC, companies can optimize their marketing and sales strategies, allocate resources effectively, and ensure that acquisition costs align with the customer lifetime value (CLV).
Additional Information & Related Terms
Customer Lifetime Value (CLV) The revenue a customer generates over their relationship with the company, used alongside CAC to assess profitability.
Sales Funnel A tool for tracking the customer journey and optimizing acquisition strategies.
Go-to-Market Strategy Influences CAC by determining the channels and methods used to acquire customers.
Key Performance Indicators (KPIs) CAC is a critical KPI for measuring marketing and sales efficiency.