What is the CAC formula?

CAC = Total Sales & Marketing Spend ÷ Number of New Customers Acquired. Both figures should cover the same time period — typically a month, quarter, or year.

What costs should I include in the spend figure?

Include all direct acquisition costs: ad spend, agency fees, salesperson salaries and commissions, content production, SEO tools, and any marketing software tied to acquisition. Exclude retention costs like customer support and onboarding.

What is a good LTV:CAC ratio?

A ratio of 3:1 is the widely cited benchmark — meaning each customer is worth three times what it costs to acquire them. Below 1:1 means you lose money on every customer. Between 1:1 and 3:1 is marginal. Above 5:1 may indicate you are underinvesting in growth.

What is CAC payback period?

Payback period = CAC ÷ Average Monthly Revenue Per Customer. It tells you how many months of revenue from a customer are needed to recover acquisition cost. SaaS companies typically target under 12 months; ecommerce often targets under 6.

Why does CAC differ by channel?

Each acquisition channel has different unit economics. Paid search typically converts faster but at higher cost; organic SEO has high upfront investment but near-zero marginal CAC at scale; referrals often have the lowest CAC but are harder to scale. Tracking per-channel CAC lets you allocate budget to the most efficient sources.

Common levers: improve conversion rates on landing pages and checkout, invest in organic channels (SEO, content, word-of-mouth), run referral programs, narrow audience targeting to higher-intent segments, and continuously A/B test ad creative and copy.

Customer Acquisition Cost Calculator

Name: Customer Acquisition Cost Calculator
Availability: InStock
Author: Nham Vu

Divide your total sales and marketing spend by new customers acquired to get CAC, then see your LTV:CAC ratio and per-channel breakdown.

Overall CAC

Total Sales & Marketing Spend

All acquisition costs for the period (ads, salaries, tools, fees)

New Customers Acquired

Number of new customers won in the same period

Customer Lifetime Value (LTV) (optional)

Expected total revenue per customer over their lifetime

Avg Monthly Revenue Per Customer (optional)

Used to calculate the CAC payback period in months

Channel Breakdown (optional)

Enter spend and customers per channel to compare CAC side by side.

Results

Customer Acquisition Cost (CAC)

$100.00

Per new customer acquired

Total Spend

$50,000.00

New Customers

500

LTV : CAC Ratio

3.00 : 1

Healthy

Excellent — your LTV well exceeds acquisition cost.

Formula Breakdown

CAC = $50,000.00 ÷ 500 = $100.00

LTV:CAC Benchmarks

Max CAC at 3:1

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Max CAC at 2:1

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Max CAC at 1:1

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Enter LTV above to see the maximum CAC you can afford at each ratio target.

CAC by Channel

Channel	Spend	Customers	CAC

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Summary