What is the formula used to calculate Customer Acquisition Cost (CAC)?

The formula used to calculate Customer Acquisition Cost (CAC) is indeed based on the relationship between total expenses involved in acquiring new customers and the number of those customers acquired within a specific time frame. The correct answer encapsulates this concept by combining both marketing expenses and sales expenses, which are crucial components of the total cost incurred in acquiring new customers.

CAC is an important metric for businesses as it provides insights into the effectiveness and efficiency of their customer acquisition strategies. By dividing the sum of marketing and sales expenses by the number of new customers gained, companies can determine how much is being spent on acquiring each new customer. This information is essential for budgeting, forecasting, and optimizing marketing and sales strategies.

The other choices, while they involve various metrics related to sales and marketing, do not accurately reflect the standard method for calculating CAC. They either do not account for both sales and marketing expenses or incorrectly relate expenses to revenue without focusing directly on customer acquisition costs. The emphasis on both sales and marketing expenses in the correct formula is key to understanding the comprehensive cost associated with attracting new customers.