Advanced Customer Acquisition Cost Calculator
About Customer Acquisition Cost (CAC)
CAC is a key business metric that measures the total cost of acquiring a new customer. It’s calculated by dividing the total marketing and sales expenses by the number of new customers acquired during a specific period.
Why CAC matters:
- Helps evaluate marketing campaign effectiveness
- Essential for calculating return on investment (ROI)
- Important for pricing strategy and profitability analysis
- Helps optimize marketing budget allocation
- Critical for understanding customer lifetime value (LTV) ratio
Interpreting Your CAC
• Good CAC: Typically 1/3 of customer lifetime value (LTV)
• Concerning CAC: Approaching or exceeding LTV
• Excellent CAC: Less than 1/4 of LTV with strong retention
Customer Acquisition Cost (CAC) Calculator
Knowing how much you spend to acquire each new customer is vital for sustainable business growth. Our CAC calculator helps you measure the cost-effectiveness of your marketing and sales campaigns so you can optimize your strategy, budget smarter, and improve profitability.
Why CAC Matters:
- Helps you measure marketing and sales efficiency
- Essential for calculating ROI and CLV
- Informs decisions on ad spend and lead generation
- Crucial for startups, SaaS, and eCommerce businesses
How is CAC Calculated?
xCustomer Acquisition Cost (CAC) is calculated by dividing the total cost of your marketing and sales efforts by the number of new customers you gained during that period.
Formula:
CAC = Total Sales & Marketing Costs / Number of New Customers Acquired
Example:
If you spent $5,000 on campaigns and gained 100 new customers, your CAC would be $50.
CAC Breakdown Example
Here’s a simplified breakdown of CAC using an imaginary campaign:
- Marketing Spend: $3,000
- Sales Team Cost: $2,000
- New Customers: 100
- Resulting CAC: $50 per customer