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Dictionary by pitch.dog
Margins, break-even & unit economics · Core

Customer acquisition cost

Also called: CAC

ELI5

Sales and marketing cost allocated to newly acquired customers under a stated method.

Used in conversation

“Compare customer acquisition cost with the same cohort and period before drawing a conclusion.”

Pitch context

You will see “Customer acquisition cost” in financial models, budgets, board packs and investor materials when the discussion reaches margins, break-even & unit economics.

Why it matters: In margins, break-even & unit economics, different calculation boundaries, periods or accounting treatments can change the number and the decision.

Caution

Calculation, recognition and disclosure can vary by accounting framework, company policy and reporting context.

Connected terms

  • Cost per acquisitionCAC estimates cost to acquire a customer; CPA measures cost per defined action or acquisition event, which may not be a customer.
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Sources & evidence · 4

Direct term-level sources and supporting source families.