How do you calculate CAC?

The basic CAC formula is: CAC = Total Sales & Marketing Cost ÷ Number of New Customers. For example, if you spent $50,000 on marketing and sales in a quarter and acquired 500 new customers, your CAC is $100.

A good CAC depends on your industry and customer lifetime value (LTV). As a rule of thumb, many SaaS and subscription businesses target an LTV:CAC ratio of at least 3:1. If your CAC is close to or higher than your LTV, your growth is likely unsustainable.

Should salaries be included in CAC?

Yes, you should include the fully loaded cost of sales and marketing teams whose primary role is acquiring new customers. That usually means base salary, commissions, bonuses, and benefits for SDRs, AEs, performance marketers, and demand gen roles. Exclude roles focused on retention or product development.

What is blended CAC vs. channel CAC?

Blended CAC is your total acquisition cost across all channels divided by all new customers. Channel CAC looks at a single channel (for example, paid search or outbound sales) and divides that channel's cost by the customers it acquired. Channel-level CAC helps you see which channels are most efficient.

How does CAC relate to payback period?

CAC payback period tells you how many months of gross profit it takes to recover what you spent to acquire a customer. It is calculated as CAC divided by average monthly gross profit per customer. Shorter payback periods (for example, under 12 months) are generally healthier for cash flow.

CAC Calculator – Customer Acquisition Cost per Customer & Channel

Q: What is customer acquisition cost (CAC)?

Customer acquisition cost (CAC) is the total sales and marketing cost required to acquire one new customer over a given period. It typically includes ad spend, marketing tools, salaries, commissions, and any onboarding incentives divided by the number of new customers acquired.

Channel	Marketing cost	Sales cost	New customers	CAC / customer	Notes
Totals	0	0	0	–

How to use the CAC calculator

This CAC (Customer Acquisition Cost) calculator helps you understand how much you spend to acquire each new customer, both overall and by channel (for example, paid search, organic, outbound sales).

Choose your currency and period (month, quarter, year, or custom).
For each channel, enter:
- Marketing cost – ad spend, tools, agencies, content, etc.
- Sales cost – salaries, commissions, bonuses, SDR tools, etc.
- New customers acquired in that period from the channel.
Optionally add a note (for example, “US only”, “brand campaign”).
Enter your average monthly gross profit per customer to estimate CAC payback period.

Customer acquisition cost formula

Blended CAC = (Total Marketing Cost + Total Sales Cost) ÷ Total New Customers

For a single channel, the formula is the same but limited to that channel’s costs and customers:

Channel CAC = (Channel Marketing Cost + Channel Sales Cost) ÷ Channel New Customers

CAC payback period

CAC payback period tells you how long it takes to recover what you spent to acquire a customer.

CAC Payback (months) = CAC ÷ Average Monthly Gross Profit per Customer

Example: if your CAC is $300 and your average monthly gross profit per customer is $75, then:

CAC Payback = 300 ÷ 75 = 4 months

What costs should be included in CAC?

To get a realistic CAC, include all costs directly tied to acquiring new customers, such as:

Marketing: ad spend (search, social, display), sponsorships, content production, marketing tools, agencies.
Sales: SDR and AE salaries, commissions, bonuses, sales tools (CRM, dialers), travel and events.
Onboarding incentives: discounts, referral bonuses, sign-up credits (if they are part of acquisition, not retention).

Exclude costs that are primarily about retention or product (for example, customer success, support, R&D) unless you are intentionally using a broader definition.

Interpreting your CAC results

1. Blended CAC

Blended CAC is useful for high-level planning and board reporting. It shows how efficient your entire go-to-market engine is at turning spend into customers.

2. Channel-level CAC

Channel CAC helps you decide where to allocate budget. Lower CAC channels are usually more efficient, but you should also consider:

Scalability – can you spend more without CAC rising sharply?
Lead quality – do customers from this channel churn faster or spend less?
Time to impact – some channels (SEO, content) have slower but compounding returns.

3. CAC vs. LTV (lifetime value)

CAC by itself is incomplete. Compare it to your customer lifetime value (LTV):

Healthy SaaS benchmark: LTV:CAC ratio of at least 3:1.
If LTV:CAC < 1:1, you are losing money on each customer.
If LTV:CAC is extremely high (for example, > 7:1), you may be under-investing in growth.

Common CAC mistakes to avoid

Ignoring sales costs and only counting ad spend.
Mixing time periods (for example, quarterly spend divided by monthly customers).
Attributing customers to the wrong channel due to poor tracking.
Not separating new vs. expansion revenue when estimating payback.

FAQ

What is customer acquisition cost (CAC)?

Customer acquisition cost (CAC) is the average amount you spend on marketing and sales to acquire a single new customer over a defined period.

How often should I recalculate CAC?

Most teams track CAC monthly and review trends quarterly. For early-stage startups with rapidly changing spend and funnels, reviewing CAC weekly can be helpful.

What is a good CAC payback period?

Many SaaS and subscription businesses target a CAC payback period of under 12–18 months. Shorter payback improves cash flow and reduces risk, but acceptable ranges vary by industry and funding model.

Can I use this calculator for B2C and B2B?

Yes. The formulas are the same for B2C and B2B. The main difference is that B2B CAC is usually higher, with longer sales cycles and more complex sales teams.

Customer Acquisition Cost (CAC) Calculator

CAC Calculator

Channel comparison