Work out your customer acquisition cost in seconds, then add lifetime value to see if your LTV:CAC ratio clears the healthy 3:1 bar. Free, instant, no signup.
Customer Acquisition Cost is the total amount you spend to win one new paying customer. The formula is simple — total sales and marketing spend in a period, divided by the number of new customers acquired in that same period:
CAC = total sales & marketing spend ÷ new customers acquired.
Spend $10,000 and sign 50 customers, and your CAC is $200. That single number sets the floor for almost every other decision in the business: what you can charge, how long customers must stay, and how much cash you need to fund growth.
The most common mistake is counting only ad spend. Real CAC includes everything that contributed to acquisition over the period:
Leave none of it out. "We didn't pay for SEO this month" is not true if an in-house specialist on a $90k salary produced those organic signups. Blended CAC (all spend ÷ all new customers) is the honest baseline; you can segment by channel later.
CAC on its own is meaningless — $600 is fantastic for enterprise software and catastrophic for a mobile game. The number only becomes useful when you compare it to lifetime value. That is why this calculator also asks for LTV and returns the LTV:CAC ratio, the single most important figure in unit economics:
| Business type | Typical CAC | Target LTV:CAC |
|---|---|---|
| B2B SaaS (SMB) | $200–$600 | 3–5× |
| B2B SaaS (Enterprise) | $5,000–$50,000 | 4–6× |
| D2C e-commerce | $15–$80 | 3× |
| Subscription mobile app | $8–$50 | 3× |
| Fintech | $80–$300 | 4× |
If your CAC is far off these ranges it is not automatically wrong — it means you have a story to explain. A $2,000 CAC in D2C usually signals a luxury brand with high LTV; a $5 CAC in B2B usually signals weak monetization.
There are only three real levers. Improve conversion rate so the same traffic produces more customers — often the fastest win (see the conversion rate calculator). Lower cost per click or per lead by shifting budget to better-performing channels and creative (the CPC & CPM calculator helps you compare). And raise LTV through pricing, retention, and expansion revenue — which makes a higher CAC perfectly affordable rather than forcing you to cut spend.
Most teams obsess over cutting CAC while ignoring LTV. A 20% increase in retention often does more for the LTV:CAC ratio than a 20% cut in ad spend, and it doesn't shrink your growth.
Counting signups instead of paying customers inflates your customer count and understates CAC. Mixing time periods — this month's spend against last quarter's customers — produces a meaningless number. And excluding salaries makes a struggling funnel look healthy. Pull spend and new customers from the same period, count only paying customers, and include the fully loaded cost of acquisition.
CAC = total sales & marketing spend ÷ new customers acquired in the same period. $10,000 spend and 50 new customers gives a CAC of $200.
It depends entirely on lifetime value. Aim for an LTV:CAC ratio of at least 3:1 — the absolute CAC number is only meaningful next to LTV.
Ad spend, marketing and sales salaries, tools, content, agency fees and affiliate commissions — everything that drove acquisition. Counting only ad spend is the classic error.
Lifetime value ÷ acquisition cost. Under 1:1 loses money; 1–3:1 is fragile; 3–5:1 is healthy; over 5:1 may mean you're underspending on growth.