Customer Acquisition Cost (CAC) Calculator
From total sales & marketing spend and new customers, compute the customer acquisition cost (CAC) and its ratio to revenue.
Input Data
Results
At a glance:CAC = total sales & marketing spend / new customers. With revenue per customer, CAC ratio = CAC / revenue per customer. Example: HK$100,000 spend, 500 customers → CAC HK$200; if revenue/customer HK$1,000, ratio 20%. Compared with LTV, LTV/CAC > 1 means acquisition pays back (3x+ commonly healthy); < 1 means losing money per customer. WARNING: Keep the spend window and customer count consistent (same period/channel); excluding a channel's fixed overhead understates CAC. Pair with LTV.
Formula
Total spend = sales & marketing spend + sales spend.
CAC = total spend ÷ new customers.
$$\text{CAC} = \dfrac{\text{Marketing} + \text{Sales}}{\text{New Customers}}$$How to Use
- Enter the sales & marketing spend for the period.
- Enter the new customers acquired in the same period.
- Optionally enter revenue per customer to see the CAC ratio.
FAQ
What does a healthy CAC look like?
It depends on your LTV (lifetime value). A common rule: LTV/CAC ≥ 3 means acquisition is efficient; between 1 and 3 is borderline; below 1 means you lose money on each customer and must fix the model or stop that channel. Also watch the payback period — how fast CAC is recovered from customer revenue.
How do I count the marketing spend correctly?
Include all acquisition costs in the period: ads, platform fees, agency, sales commissions, promotions, and a fair share of creative/tooling. Excluding parts understates CAC and flatters efficiency. Use the same window as the new-customer count.
How does CAC differ from CPA?
CAC is the cost to acquire a paying customer (revenue-generating). CPA (cost per acquisition) can mean any conversion — a sign-up, trial or lead — not necessarily a paying customer. CAC is stricter and ties to revenue; CPA can be broader. Be clear which you mean when comparing.
How do I lower CAC?
Raise conversion (landing page, funnel), improve targeting and creative, retain more (raises LTV, justifies higher CAC), focus high-ROI channels, and use referrals. But do not cut CAC so far that growth stalls — balance CAC against LTV and growth goals.
What is the CAC ratio and why use it?
CAC ratio = CAC / revenue per customer, showing acquisition cost as a share of customer value. Lower is better (cost recovered faster). It complements LTV/CAC and is handy when you only know per-customer revenue, not full lifetime value. Still, LTV is the fuller picture.
Related Tools
References
Content review: Calculatorism Finance Team. Results are for reference only; please refer to the relevant authorities for the official figures.