Work out how much you spend, on average, to win each new customer.
Enter the number of new customers acquired.
Formula: (Ad Spend + Salaries + Software & Tools) ÷ New Customers. All amounts in $, for the same time period.
Customer Acquisition Cost (CAC) is a business metric that shows how much you spend, on average, to win one new customer. A CAC Calculator divides your sales and marketing costs for a period by the number of new customers you gained in that same period. Growth only helps if each customer brings in more value than they cost to acquire, so CAC is usually read alongside customer lifetime value and profit margins.
Tracking CAC helps you compare channels, see how changes in spending affect results, and explain your numbers to partners or investors. It describes the past period you measure and is not a forecast.
A "fully loaded" CAC includes more than ad spend. This calculator uses these inputs:
Direct advertising on platforms such as Google Ads, Meta, LinkedIn and traditional media. You can also include other marketing costs here, such as content production, creative, agency fees and SEO tools.
The human cost of acquiring customers: salaries of your marketing and sales staff, plus commissions and bonuses for closing deals. If people split their time between acquiring customers and other work, include only the share spent on acquisition.
The cost of the tools you use for acquisition, such as a CRM, email marketing software and analytics tools.
The number of new paying customers gained during the same period you used for the costs (month, quarter or year). Count a customer only once.
CAC = (Ad Spend + Sales & Marketing Salaries + Software & Tools) ÷ New Customers Acquired
The result is the average amount spent per new customer. CAC cannot be calculated when the number of new customers is zero, because the formula divides by that number.
| Ad Spend | Salaries | Software | New Customers | CAC |
|---|---|---|---|---|
| $5,000 | $2,000 | $500 | 50 | $150.00 |
| $8,000 | $3,000 | $1,000 | 60 | $200.00 |
| $2,000 | $0 | $200 | 40 | $55.00 |
| $1,250 | $0 | $0 | 8 | $156.25 |
Calculated with this calculator's formula.
If your CAC is higher than you would like, these are common areas to review. Results depend on your business:
A CAC figure on its own does not tell you whether it is good or bad. What matters is how it compares with what a customer brings in over time. Illustrative example: if an average customer generates $600 of gross profit over their relationship with you, a CAC of $150 leaves room for profit, while a CAC of $800 does not. Use gross profit (revenue minus the direct costs of serving the customer) rather than revenue when you make this comparison.
Entering one month of ad spend alongside a full year of new customers (or the reverse) produces a meaningless number. Keep every input to the same period.
Counting only ad spend and ignoring salaries and software gives a lower "paid-media-only" figure rather than a fully loaded CAC.
CAC becomes meaningful when you compare it with the profit a customer generates over time.
If your sales cycle is long, customers won this month may come from spending in earlier months. Consider this when you compare periods.
A fully loaded CAC shows what it really costs to win a customer. Calculate it for consistent periods, compare it with lifetime value and margins, and track blended and paid CAC separately for a clearer view of your marketing efficiency.