The Personal MBA

Master the Art of Business

A world-class business education in a single volume. Learn the universal principles behind every successful business, then use these ideas to make more money, get more done, and have more fun in your life and work.

Buy the book:


What Is 'Allowable Acquisition Cost (AAC)'?

Allowable Acquisition Cost (AAC) is the marketing component of the Lifetime Value. The higher the Lifetime Value of your customers, the more you can spend to attract new customers.

To calculate your AAC follow these steps:

  1. Start with your average customer's Lifetime Value.
  2. Subtract your Value Stream costs.
  3. Finally, subtract your Overhead divided by your customer base (which represents your Fixed Costs).

The higher the Lifetime Value, the higher the AAC. The more each new customer is worth, the more you can spend to attract them and keep them happy.

Questions About 'Allowable Acquisition Cost (AAC'


"Any business can buy incremental unit sales at a negative profit margin, but it's simpler to stand on the corner handing out $20 bills until you go broke."

Morris Rosenthal, author of Print-on-Demand Book Publishing and blogger at fonerbooks.com


From Chapter 5:

Finance


https://personalmba.com/allowable-acquisition-cost/



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The Personal MBA

Master the Art of Business

A world-class business education in a single volume. Learn the universal principles behind every successful business, then use these ideas to make more money, get more done, and have more fun in your life and work.

Buy the book:


About Josh Kaufman

Josh Kaufman is an acclaimed business, learning, and skill acquisition expert. He is the author of two international bestsellers: The Personal MBA and The First 20 Hours. Josh's research and writing have helped millions of people worldwide learn the fundamentals of modern business.

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