This component consists of the total marketing and sales costs spent by the company in attracting new customers.
Marketing costs include:
i. Advertising on TV, print media
ii. On ground activations if any
iii. Tie-ups or partnerships
Sales costs include:
i. Salaries of sales persons
ii. Travelling expenses of sales staff
For example, if Flipkart spends Rs. 100000 on marketing and sales, thereby generating 1000 new customers who place orders on the site, the cost for acquiring a new customer would be Rs. 100.
b. Operational cost of recording the order
This component includes the cost of operational systems(IT or paper based) which store the order and the costs of utilities consumed in warehouse and distribution centres and the cost of telecommunication used in dispatching the order.