Companies create significant value by pulling the Customer Acquisition Cost (CAC) lever. Consider a 1,200 employee mid-market company. In this example scenario, the company’s CAC was roughly $100,000 before aligning its sales and marketing strategies. However, the marketing team had been building a lead-generation engine that was in direct conflict with the sales team’s big-game hunting strategy.
Below is an example of customer acquisition cost analysis to illustrate the type of impact that is possible for your enterprise.
By aligning strategies and resources across the two functions, this company effectively reduced CAC to $75,000 per customer. It achieved this improvement by increasing the number of customers acquired through an inside sales function that could absorb the marketing leads. As a result, the company created an additional $25,000 of contribution margin per customer in year one.
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