CAC Calculator
Calculate customer acquisition cost and use it to judge channel efficiency and marketing budget.
Summary
CAC = Total acquisition spend ÷ New customers acquired. Compare against customer lifetime value (LTV:CAC ≥ 3× is healthy).
Why CAC matters
Customer acquisition cost tells you what it costs to bring in one paying customer. It's one of the most important SME metrics because it sets the ceiling on marketing spend and influences every pricing decision.
Formula and inputs
CAC = Total acquisition spend ÷ New customers acquired
Include:
- Paid ads (Google, Meta, LinkedIn)
- Content and SEO costs directly tied to acquisition
- Salaries of marketing and sales people working on acquisition
- Acquisition software and tools
Example
Monthly spend of $8,000 acquires 40 customers → CAC = $200. If LTV is $900, LTV:CAC = 4.5× — profitable and room to invest more.
How to improve CAC
- Improve landing page conversion rates
- Invest in organic channels (SEO, referral, content)
- Tighten paid targeting and raise quality scores
- Reduce churn — loyal customers lower pressure on acquisition
Frequently asked questions
Should I calculate CAC by channel?
Yes — blended CAC hides which channels are efficient. Calculate per-channel whenever possible.
What about organic customers?
Include in blended CAC and also calculate paid-only CAC separately to see if paid pulls its weight.
Next step
Keep exploring related resources to strengthen this area of the business.
See the CPL Calculator