Estimate Customer Acquisition Cost of LinkedIn

Mission

The mission of LinkedIn is connecting the world’s professionals to make them more productive and successful.

Facts

• LinkedIn currently has roughly 774M+ users.
• A total of 39% of LinkedIn users pay for LinkedIn Premium, which has four price tiers:
  Premium Career: $29.99/month
  Premium Business: $59.99/month
  Sales Navigator Pro: $79.99/month
  Recruiter Lite (Hiring): $119.95/month

Definition

• Customer acquisition cost is the best approximation of the total cost of acquiring a new customer. It includes things like advertising costs, the salary of your employees, the cost of servers, payment processing fee, etc., divided by the number of customers acquired.
• We’ll count the cost of maintaining/supporting the free tier of LinkedIn for all non-paying customers as part of the acquisition cost for the paying customer.

Assumption

• LinkedIn’s userbase = 800M
• Considering all the Premium tiers, let’s assume that LinkedIn Premium costs $70/month on average.
• Assume all estimated prices apply globally as well. In real world, they would differ depending on the countries. For example, the salary of an…