CAC Calculator

What is customer acquisition cost?

Customer acquisition cost, or CAC, is the average sales and marketing cost required to add one new customer. It turns acquisition activity into a unit-economics measure you can compare with customer contribution, payback period, and retention.

CAC formula

Use CAC = total acquisition costs ÷ new customers acquired. If sales and marketing costs total $23,000 during a quarter and 100 first-time customers are acquired, blended CAC is $230.

Build a consistent numerator

• Include advertising and campaign production for the measured period.
• Allocate relevant sales and marketing compensation with a documented method.
• Include acquisition software, agencies, commissions, and events where applicable.
• Keep retention and customer-success costs separate unless your policy says otherwise.
• Use the same policy from period to period so changes reflect performance rather than accounting drift.

Match costs with customers

CAC becomes misleading when costs from one period are divided by customers from another, or when all costs are compared with customers assigned to only one channel. Longer sales cycles may require cohort-based attribution or a rolling window. Document those choices before comparing teams or periods.

Use CAC with payback and retention

Lower CAC is not automatically better if it brings customers who leave quickly or contribute little margin. Review CAC with gross profit, payback period, retention, and acquisition volume to understand whether growth is both efficient and durable.