In determining lifetime value for individual customers, customer acquisition costs are determined by:
A) dividing advertising costs by the number of customer transactions
B) dividing the total marketing and advertising costs by the number of new customers
C) dividing the total marketing and advertising costs by the number of total customers
D) dividing the advertising costs associated with acquiring new customers by the number of new customers

Question

Quizplus · Accepted Answer

Customer acquisition costs are calculated by dividing the total marketing and advertising costs by the number of new customers acquired, which is option B.

In Determining Lifetime Value for Individual Customers, Customer Acquisition Costs