Original subtitles

Here, you can see a slightly different spreadsheet,

but it's actually building on the previous example.

In row one, marketing costs,

and including the cost of building,

the ads across the street,

ad platforms from our previous examples.

Then, I've added in the sales and marketing salaries,

and included any overhead costs for sales and marketing.

So, these show up in these three rows.

We add them up to get our total sales and marketing cost.

So, I'm going to sum up these three cell values,

and I'm going to copy the formula over for the other two months, September and October.

Then, to get the customer acquisition cost,

I'm going to take this total sales and marketing cost

and divide it by the number of paid customer.

So, I'm going to get back in that formula.

So, I'm going to take this,

divide it by the number of paid customers,

and copy the formula over again for the two months remaining, September and October.

As you can see in this example,

our CAC was less than a $150 in range between 148-210.

A good rule of thumb is that the CAC should be a fourth of your revenue.

If you're spending more than that,

then you are spending too much.

So, you're spending too much to get a customer,

to acquire a customer.

Now, If you're spending less than that,

you're actually losing business opportunities.

So, this was one example to calculate the customer acquisition cost.