Updated on September 8th, 2025

CAC Calculator

Created By Jehan Wadia

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Include: Advertising, content creation, marketing tools, marketing salaries, agencies, SEO/SEM costs
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Include: Sales team salaries, commissions, CRM tools, sales enablement, travel costs
Count only NEW customers acquired during this period, not existing customers
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Average revenue you expect from a customer over their entire relationship with your business
CAC Formula
CAC = (Marketing Costs + Sales Costs) / Number of New Customers

Your CAC Analysis

Customer Acquisition Cost
$0.00
Total Acquisition Costs
$0.00
LTV:CAC Ratio
N/A
Marketing Cost %
0%
Sales Cost %
0%
Industry Benchmark
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CAC Optimization Tips
  • Aim for an LTV:CAC ratio of 3:1 or higher
  • Track CAC by channel to identify most efficient sources
  • Consider both paid and organic acquisition costs
  • Monitor CAC trends over time to spot inefficiencies
  • Include all related costs: tools, salaries, and overhead

Introduction

Customer Acquisition Cost (CAC) is how much money your business spends to get one new customer. This number helps you understand if your marketing is working well. To find your CAC, you add up all the money spent on sales and marketing, then divide by the number of new customers you got. For example, if you spent $1,000 on ads and got 10 new customers, your CAC is $100 per customer.

Knowing your CAC helps you make smart choices about your business. If it costs too much to get new customers, you might lose money. A good CAC means you spend less to get customers than they pay you back. This calculator makes it easy to find your CAC quickly. Just enter your marketing costs and customer numbers to see if your spending makes sense. For businesses looking to improve their long-term profitability, you might also want to check our Dividend Calculator to understand potential returns on investments.

How to use our CAC Calculator

Enter your business costs and customer numbers to find out how much you spend to get each new customer. The calculator will show your Customer Acquisition Cost (CAC) and compare it to other businesses.

Time Period: Pick if you want to calculate costs for a month, quarter, or year by clicking the matching button.

Marketing Expenses: Type in all the money you spent on marketing like ads, content, tools, and marketing team pay.

Sales Expenses: Enter what you paid for sales including sales team pay, bonuses, CRM tools, and travel costs.

Number of New Customers: Put in how many brand new customers you got during your chosen time period (not old customers).

Customer Lifetime Value (Optional): Add how much money you expect to make from one customer over their whole time with your business to see if your CAC is worth it.

Industry: Choose your type of business from the list to see how your costs compare to similar companies.

Understanding Customer Acquisition Cost (CAC)

Customer Acquisition Cost, or CAC, is the total amount of money your business spends to get one new customer. This important number helps you understand if your marketing and sales efforts are working well. Think of it like this: if you spend $1,000 on ads and sales work, and you get 10 new customers, your CAC is $100 per customer.

Why CAC Matters for Your Business

Knowing your CAC helps you make smart choices about how to grow your business. If it costs too much to get new customers, you might lose money. The best businesses keep their CAC low while still bringing in good customers. You want to spend less to get each customer than the money they will bring to your business over time. For those planning early retirement strategies, understanding business metrics like CAC alongside tools like our Coast FIRE Calculator can help you determine when your investments might support your lifestyle.

What Goes Into CAC

Your CAC includes all the money you spend on marketing and sales. Marketing costs include things like online ads, making content, paying for marketing tools, and the salaries of marketing workers. Sales costs include paying your sales team, their bonuses, software for tracking customers, and any travel costs. Add all these costs together, then divide by the number of new customers you got during that time. If you're analyzing various business investments, you may also find our Dividend Yield Calculator useful for comparing different investment returns.

Using CAC to Improve Your Business

Once you know your CAC, compare it to how much money each customer brings in over time (called Lifetime Value or LTV). A healthy business usually has customers worth at least three times more than it costs to get them. This is called the LTV to CAC ratio. You should also track your CAC over time to see if it's going up or down. Different types of businesses have different normal CAC levels, so it helps to know what's typical for your industry.


Frequently Asked Questions

What is a good CAC for my business?

A good CAC depends on your type of business and how much money each customer brings you. Most healthy businesses aim for customers to be worth at least 3 times more than what it costs to get them. This means if you spend $100 to get a customer, they should bring you at least $300 over time.

How often should I calculate my CAC?

You should calculate your CAC every month to spot problems early. Many businesses also look at it every quarter and year to see bigger trends. Regular checking helps you fix high costs before they hurt your business.

What if my CAC is higher than my industry average?

If your CAC is higher than other similar businesses, look at where you spend the most money. Try testing cheaper marketing ways, improve how you turn leads into customers, or focus on keeping current customers happy instead of always finding new ones.

Should I include employee salaries in my CAC?

Yes, include the salaries of people who work in marketing and sales. This gives you the real cost of getting customers. Don't forget to add bonuses and commissions too.

What's the difference between CAC and CPA?

CAC (Customer Acquisition Cost) is for getting new paying customers. CPA (Cost Per Acquisition) can mean getting any action like email sign-ups or free trials. CAC only counts people who actually buy from you.

How can I lower my CAC quickly?

To lower CAC fast, stop spending on marketing that doesn't work, make your website better at turning visitors into buyers, ask happy customers to tell friends about you, and focus on keeping the customers you already have.

Why is the LTV to CAC ratio important?

The LTV to CAC ratio shows if your business makes money. If customers bring in less money than it costs to get them, you lose money. A ratio of 3:1 or higher means your business is healthy and can grow.

Can CAC be zero?

CAC is never really zero because you always spend something to get customers, even if it's just time. Free methods like word-of-mouth still have costs like the time workers spend or rewards you give for referrals.


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