What is customer acquisition cost?
Jan. 2, 2019, 10:13 a.m.
If you plan to conduct an advertising campaign and do not spend money on anything, then you definitely need to know about such a key indicator as the cost of attracting a client. By calculating it, you will be able to achieve the effectiveness of any promotional activities carried out by your company, forecast advertising budgets for the future, thereby ensuring your business a successful development. Having learned to calculate the cost of attracting a client, you will understand which of the used channels of attraction are effective and which ones are better not to use. Every internet business wants to know how much profit it can generate from investments in marketing campaigns. When you invest money in promotion in social networks, in contextual advertising, in search engine promotion, in media advertising or in email marketing, first of all, you should know what the return will be. Considering the return from one client in the perspective of time, that is, for the entire life cycle of the client LTV (Lifetime value of a client), you can see whether your money paid off in the acquisition of this client. This miscalculation will also show which marketing channels for your business are more effective. If you are an entrepreneur planning your next business, you cannot afford to ignore the cost of attracting a client. The sooner you start working on this, the better, so different approaches to optimizing the cost of attracting customers will require you to build your product in different ways. It is also important to ask yourself the question as early as possible: can my business earn from clients more than the cost of attracting them? In terms of investment opportunities, your chances will increase dramatically once you prove that you have a viable business model. As soon as you prove the viability of your business model, press on the gas and invest as much as you can afford. You will want to take the market as quickly as possible before competitors understand what you have done and try to steal your market.