Acquisition Cost

Posted in Marketing and Strategy Terms, Total Reads: 1758

Definition: Acquisition Cost

Acquisition cost is defined as the cost business incurs in acquiring a new customer i.e. cost of all the efforts which are undertaken in order to place product or service in front of the customer in order to enable him/her to eventually buy it.

e.g. A company may need to advertise, distribute and partner in order to sell a product. The sum total of all these 3 divided by number of people who bought the product is acquisition cost.

The activities can be different for different type of products 

but the Acquisition Cost=Sum of all costs incurred/Number of Customers

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