Customer Acquisition Cost
CAC is an app business metric used to understand how much it costs to acquire a customer. CAC is the total sales and marketing costs to gain a new customer over a specified time. Understanding this cost helps businesses make budgeting decisions when attracting new customers.
Why is CAC important for app developers?
Gaining new app users and growing a customer base is an important part of a company’s entire team to understand, including developers. Knowing what each customer is worth improves the product roadmap—and developers are better able to build the right products and services that would resonate and bring value to customers. It also helps from a business standpoint and making better decisions about what to invest in. The golden rule is to keep CAC lower than LTV so you turn a profit on your user acquisition spend.
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