Linda's company acquired 6,000 new customers last year. They spent $40,000 in marketing costs and $20,000 in sales costs. What is Linda's customer acquisition cost (CAC)?

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Multiple Choice

Linda's company acquired 6,000 new customers last year. They spent $40,000 in marketing costs and $20,000 in sales costs. What is Linda's customer acquisition cost (CAC)?

Explanation:
CAC is the average cost to acquire a customer, found by dividing total marketing and sales costs by the number of new customers. Here, total spend is $40,000 + $20,000 = $60,000, and 6,000 new customers were gained. So CAC = $60,000 ÷ 6,000 = $10 per customer. The value that shows $10 per customer is the correct one. This measure helps evaluate how efficiently marketing and sales dollars convert into new customers.

CAC is the average cost to acquire a customer, found by dividing total marketing and sales costs by the number of new customers. Here, total spend is $40,000 + $20,000 = $60,000, and 6,000 new customers were gained. So CAC = $60,000 ÷ 6,000 = $10 per customer. The value that shows $10 per customer is the correct one. This measure helps evaluate how efficiently marketing and sales dollars convert into new customers.

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