Customer acquisition cost (CAC) is a metric used by businesses to measure the cost of acquiring a new customer. It takes into account all the expenses incurred in the process of attracting and converting a potential customer into a paying customer. These expenses can include marketing and advertising costs, sales team salaries, and any other costs associated with acquiring a new customer. CAC is an important metric for businesses as it helps them understand the effectiveness of their marketing and sales strategies and allows them to make informed decisions about their customer acquisition efforts. A lower CAC indicates that a business is acquiring customers at a lower cost, which can lead to higher profits and a more sustainable business model.