Luxy Hair is an online store that sells hair extensions and hair-related accessories. With over 3 million subscribers on YouTube, it’s killing it.
Luxy Hair's logo; below it is no. of subscribers
Luxy Hair makes videos that get thousands, if not millions, of views.
Grid format of Luxy Hair's videos on YouTube
Each video features different ways of styling hair, taking care of it, and more. And each video—ding ding ding, you guessed it—features Luxy Hair’s own products.
The company then makes it easy for any viewer or subscriber to buy by including the relevant links in the video description.
Video description box showing relevant links to Luxy Hair products, influencer featured in the video, etc
Recommended reading: The Four-Part Formula That Got Luxy Hair 2.8 Million Subscribers on YouTube
Here are some frequently asked questions related to customer acquisition.
How do you calculate customer acquisition cost?
Customer acquisition cost (CAC) is the average amount of money you spend to acquire a single customer.
This is calculated by dividing your customer acquisition expenses by the number of acquired customers.
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CAC = Total amount spent on marketing/Number of new customers acquired
For example, if you acquired 10 new customers after spending $1,000 on your marketing, your CAC would be $1000/10 = $100.
What is the average customer acquisition cost?
According to Shopify’s research, here are the average CACs by industry:
Arts and entertainment: $21
Business and industrial: $533
Clothing, shoes, and/or accessories: $129
Electronics and/or electronics accessories: $377
Food, beverages, and tobacco products: $462
Health and beauty: $127
Home and garden: $129
Don’t take these benchmarks as gospel. These numbers are averages and can differ depending on your brand, exact market, average order value, and more. You should always relate your CAC to your own business.