Customer Acquisition Cost Calculator
Add up what you spent on marketing and sales in a period and how many new customers you won to get your customer acquisition cost (CAC). Add revenue per customer, gross margin and churn to see your LTV:CAC ratio and how many months it takes to earn back each customer's cost.
Ads, content, events, agency fees, marketing salaries and tools.
Sales salaries, commissions, sales tools and travel.
Optional: onboarding, free trials, referral bonuses.
Average monthly revenue per account (ARPA). Leave empty to skip.
Share of customers lost each month.
How to use the Customer Acquisition Cost Calculator
- Enter marketing and sales spend for one period, such as a month or quarter.
- Enter the new customers you acquired in that same period.
- Optionally add monthly revenue per customer, gross margin and churn.
- Read your CAC, LTV:CAC ratio and payback period.
- Use the what-if table to see how lowering CAC improves the ratio and payback.
CAC, LTV and payback formulas
- CAC = (marketing spend + sales spend + other acquisition costs) ÷ new customers
- Monthly gross profit per customer = revenue per customer per month × gross margin
- CAC payback (months) = CAC ÷ monthly gross profit per customer
- LTV = monthly gross profit per customer ÷ monthly churn rate
- LTV:CAC = LTV ÷ CAC
Example: $30,000 marketing + $20,000 sales = $50,000 for 250 customers gives a CAC of $200. At $50 per month and 75% margin each customer brings $37.50 of gross profit a month, so payback is 5.3 months. With 3% monthly churn the average customer stays 33.3 months, LTV is $1,250 and LTV:CAC is 6.25 : 1.
Reading your LTV:CAC ratio
| LTV:CAC | What it usually means |
|---|---|
| Below 1 : 1 | Each customer costs more to win than they bring in. Fix pricing, retention or channels. |
| 1 : 1 to 3 : 1 | Profitable per customer but thin; little room to cover overhead and growth. |
| About 3 : 1 | The common target for subscription businesses. |
| Above 5 : 1 | Very efficient; you may be able to spend more to grow faster. |
Ways to lower CAC
- Improve conversion rates on landing pages and checkout so the same traffic produces more customers.
- Shift budget to channels with the lowest cost per customer, and cut those that don't convert.
- Invest in referrals and content, which bring customers without a cost per click.
- Shorten the sales cycle with clear pricing, free trials and self-serve onboarding.
Frequently asked questions
How do you calculate customer acquisition cost?
CAC = total sales and marketing spend ÷ number of new customers acquired in the same period. If you spent $50,000 and won 250 customers, your CAC is $200.
What costs should be included in CAC?
A fully loaded CAC includes paid advertising, marketing and sales salaries, commissions, agency and freelancer fees, software used by marketing and sales, events and content production. A paid CAC that uses ad spend only is useful too, but label it clearly so it is not compared with a fully loaded figure.
What is a good LTV:CAC ratio?
A ratio of about 3:1, meaning a customer brings three times their acquisition cost in gross profit, is a widely used benchmark for subscription businesses. Below 1:1 you lose money on each customer; far above 5:1 may mean you could grow faster by spending more on acquisition.
How is the CAC payback period calculated?
Payback months = CAC ÷ (monthly revenue per customer × gross margin). With a $200 CAC, $50 monthly revenue and 75% gross margin, payback is 200 ÷ 37.50 = 5.3 months. Many SaaS companies aim for under 12 months.
How is LTV estimated here?
LTV = monthly revenue per customer × gross margin ÷ monthly churn rate. Dividing by churn gives the average customer lifetime in months (for example 3% churn means about 33 months). This simple model assumes constant revenue and churn.
What is blended CAC vs paid CAC?
Blended CAC divides all acquisition spend by all new customers, including those who came organically or by referral. Paid CAC divides only paid media spend by customers who came from paid channels, so it is usually higher.
Is my data private?
Yes. Everything is calculated in your browser and nothing is sent or stored on a server.