Definition

Studying other businesses that offer similar products or services. Understanding your rivals helps make smarter choices about pricing and marketing.

What to consider

  • Measure acquisition costs accurately.
  • Balance spending with customer lifetime value.
  • Adjust strategies if costs become too high.

Real world scenarios

  • A digital marketing firm calculates the cost of converting a lead from social media ads.
  • An online retailer reviews spending on search engine marketing to determine acquisition costs.
  • A subscription service tracks promotional expenses to assess cost per new member.

Related terms

Entrepreneurial Finances