# How To Calculate Cost of Acquisition Ratio in Smartsheet | Arithmix

Learn how to calculate the cost of acquisition ratio in Smartsheet with our step-by-step guide. Improve your financial analysis and decision-making skills with this essential tool.

Calculating the cost of acquisition ratio is an important metric for businesses to understand their marketing and sales efforts. This ratio measures the cost of acquiring a new customer compared to the revenue generated from that customer. It helps businesses determine the effectiveness of their marketing and sales strategies and identify areas for improvement.

## What Is Cost of Acquisition Ratio?

The cost of acquisition ratio is a financial metric that measures the cost of acquiring a new customer compared to the revenue generated from that customer. This ratio takes into account all the costs associated with acquiring a new customer, including marketing and sales expenses, and compares it to the revenue generated from that customer over a specific period of time.

For example, if a business spends \$1000 on marketing and sales efforts to acquire a new customer and that customer generates \$2000 in revenue over the next year, the cost of acquisition ratio would be 0.5. This means that for every dollar spent on acquiring the customer, the business generated two dollars in revenue.

## When Is It Valuable To Calculate Cost of Acquisition Ratio?

It is valuable to calculate the cost of acquisition ratio when a business wants to understand the effectiveness of its marketing and sales efforts. This ratio helps businesses identify which marketing and sales strategies are generating the most revenue and which ones are not. By understanding the cost of acquiring a new customer, businesses can make informed decisions about where to allocate their marketing and sales resources.

Additionally, the cost of acquisition ratio is useful when a business is looking to improve its profitability. By reducing the cost of acquiring a new customer, businesses can increase their profitability and generate more revenue from each customer. This ratio can also help businesses identify areas where they can reduce costs and improve their overall efficiency.

In conclusion, calculating the cost of acquisition ratio is an important metric for businesses to understand their marketing and sales efforts. By measuring the cost of acquiring a new customer compared to the revenue generated from that customer, businesses can make informed decisions about where to allocate their resources and improve their profitability.

## How Do You Calculate Cost of Acquisition Ratio in Smartsheet

Smartsheet itself isn’t naturally geared towards letting you calculate complex metrics like Cost of Acquisition Ratio. As an alternative, teams typically use products like Arithmix to import data from Smartsheet and build out dashboards.

## What is Arithmix?

Arithmix is the next generation spreadsheet - a collaborative, web-based platform for working with numbers that’s powerful yet easy to use. With Arithmix you can import data from systems like Smartsheet, combine it with data from other systems, and create calculations like Cost of Acquisition Ratio.

In Arithmix, data is organized into Tables and referenced by name, not by cell location like a spreadsheet, simplifying calculation creation. Data and calculations can be shared with others and re-used like building blocks, vastly streamlining analysis, model building, and reporting in a highly scalable and easy to maintain platform. Data can be edited, categorized (by dimensions) and freely pivoted. Calculations are automatically copied across a dimension - eliminating copy and paste of formulas.