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Customer Acquisition Cost Calculator – CAC

Quick answer

CAC = sales spend ÷ new customers.

  • $6,000 ads winning 150 customers = $40 CAC.
  • Compare against LTV for health.

Figures are estimates from this calculator’s standard formula — adjust the inputs in the tool below for your exact number.

How Customer Acquisition Cost Works

CAC = Total Sales & Marketing Spend ÷ New Customers Acquired

Add every cost of winning new customers — ad spend, agency fees, sales salaries and the tools that support them — and divide by how many new customers actually signed in the same period. Worked example: $6,000 of spend across ads, a $900 agency retainer and $600 of software that lands 150 new customers means CAC = 7,500 ÷ 150 = $50. If each customer generates $85 of margin, you recover the cost on the second order, and the LTV:CAC ratio of 1.7:1 says scale carefully.

  1. 1

    Total the spend

    Ads, agencies, sales salaries, commissions and marketing tools for the period.

  2. 2

    Count new customers

    First-time buyers only — exclude returning ones.

  3. 3

    Read CAC

    Spend ÷ new customers, then compare with customer lifetime value.

Use Cases

Channel budgeting

Shift spend toward the channel with the lowest CAC before scaling creative.

Investor reporting

Show blended and paid CAC side by side with the LTV:CAC trend.

Pricing sanity check

Confirm margins can absorb current CAC within two repeat orders.

Common Mistakes

  • Leaving sales salaries out of the spend total, understating CAC by 30-50%

  • Counting returning customers as "new" in the denominator

  • Comparing blended CAC to a competitor's paid-only benchmark

FAQs

What is a good CAC?

A CAC recovered by gross margin within 12 months is solid; software investors usually want LTV:CAC above 3:1.

Blended vs paid CAC?

Blended divides spend by all new customers including organic; paid counts only customers from paid channels, which is always higher.

Should salaries be included?

Yes — sales and marketing payroll belongs in CAC; exclude product and support teams.

How do I lower CAC?

Lift conversion rates, add referral programs and retain customers longer — same spend, more customers.

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