CAC to rise more than planned

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Let's take an example to understand it better: Suppose a bar owner has a 70% margin every time he sells a 10 euro coffee. On the other hand, a home furniture seller makes a 30% margin every time he sells a 700 euro sofa bed. Although the bar owner's margin is higher, every time he sells a coffee he will earn 7 euros, while the home furniture seller will earn 210 euros even though his sales margin is lower.

That is to say, the bar owner must sell 30 coffees to be able to equal the profit that the home Cambodia Phone Number Data  furniture seller makes with a single sale. What is the relationship between CAC and sales margin? You are probably wondering what the relationship is between CAC and sales margin. Let's take one more step to understand it! Let's say you have a stable CAC for a certain period. After that period you reach a ceiling in customer acquisition and the CAC rises.





If your sales margin is large, your business will have more resources to maneuver comfortably. For example: Lower the sales price to attract more customers, Increase investments in recruitment marketing, Improve the sales experience, etc. Therefore, if your business sells at a high margin (the sales price is much higher than what it costs to manufacture, produce or buy the product), then you can allow the since there will be time and space to correct the deviation and work to lower it.