CAC (Customer Acquisition Cost) Calculation Formula

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CAC is a figure that indicates the cost required to acquire one customer .
CAC can be calculated using the following formula.

CAC = total cost of customer acquisition / number of new customers

Your total cost of acquiring a customer includes the cost of direct marketing and the cost of advertising on the web/internet.
Look at your sales costs and the number of new customers you acquire so you can calculate your CAC.

Unit Economics (LTV/CAC) Formula
Unit economics is a figure that indicates the profitability of one sweden mobile database customer and is mainly used in subscription businesses .
Unit economics can be calculated using the following formula.

Unit Economics = LTV ÷ CAC

This is an indicator that can determine whether excessive costs are being incurred to acquire customers.
If the value is over 3, it can be determined that you are running a healthy subscription business.
If the value is below 3, consider revamping your business strategy.

Calculation formula for ARPA and ARPU
ARPA is the average sales amount of one account .
ARPA can be calculated using the following formula.

ARPA = Sales ÷ Number of accounts

If you have a large number of accounts, but only a few of them are connected to sales, you may have a number of accounts that are barely functioning.
Even if an account has led to purchasing behavior in the past, if it has no effect on current sales, it is an account that is almost meaningless.

On the other hand, ARPU is a figure that indicates the average revenue per user.
There are cases where one account is shared by multiple users or used on multiple devices.
For companies that develop subscription businesses centered on video content, it is not uncommon for customers to share accounts.

Companies in the above businesses should build a system that can calculate the number of users rather than the number of accounts.