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Articles

Customer Acquisitions Cost

  • unit economics,
  • metrics,
  • cards

The cost of customer acquisition. On the one hand it is considered simple - we take all marketing expenses for acquisition of potential clients in a cohort and divide it by the number of clients in the cohort. Or, which is the same thing, divide CPA by C1

It's important to realize that this metric doesn't have an unambiguous definition in terms of what to include in the attraction budget. For example, there is an open question about the cost of retaining a client in the cohort and the cost of re-engagement if the current client has already interacted repeatedly with ads aimed at attracting new clients

 To solve this problem, I suggest using the Customer Lifetime Cost (CLTC) metric.

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