Customer Acquisition Cost (CAC) Calculator
Calculate your customer acquisition cost (CAC) and compare it to customer lifetime value.
Understand if your marketing spend is profitable.
Customer Acquisition Cost (CAC) is the total cost of acquiring one new paying customer. It includes every dollar spent on marketing, advertising, sales team salaries, and tools — divided by the number of new customers gained in the same period.
The formula: CAC = Total Sales & Marketing Spend / Number of New Customers Acquired
Why CAC matters: CAC on its own means nothing — it must be compared to Customer Lifetime Value (LTV). The LTV:CAC ratio tells you whether your business model is sustainable:
- LTV:CAC < 1 — you lose money on every customer. Unsustainable.
- LTV:CAC = 1–3 — marginal. You may be growing but not efficiently.
- LTV:CAC = 3–5 — healthy. Industry benchmark for SaaS and e-commerce.
- LTV:CAC > 5 — excellent. Strong unit economics. Consider investing more in growth.
CAC payback period: How many months of revenue does it take to recover the cost of acquiring a customer? Payback Period = CAC / (Monthly Revenue per Customer × Gross Margin %)
Benchmark examples:
- E-commerce: CAC typically $10–$50
- SaaS (B2C): CAC typically $100–$400
- SaaS (B2B): CAC typically $500–$5,000
- Financial services: CAC can exceed $1,000
A high CAC is not always bad — if your customers spend a lot over their lifetime, the investment is justified. The key metric is always LTV:CAC.