Customer Acquisition Cost Calculator
Calculate customer acquisition cost (CAC) from sales and marketing spend and the number of new customers, with CLV to CAC ratio.
Last reviewed by the Radiatus Cloud team
Calculate how much it costs to acquire each new customer.
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Calculate customer acquisition cost
Customer acquisition cost, or CAC, is the average amount a business spends to win a new customer. It is calculated by dividing the total sales and marketing spend over a period by the number of new customers acquired in that period. If you spent fifty thousand and gained two hundred customers, your CAC is two hundred and fifty. If you also enter customer lifetime value, the calculator shows the all-important ratio of lifetime value to acquisition cost and assesses whether your growth is profitable.
Including all relevant sales and marketing costs, not just advertising, gives a realistic figure.
Why CAC matters
Customer acquisition cost is a vital metric for any business that spends to grow, especially subscription and ecommerce companies. On its own CAC tells you the price of growth, but its real power comes from comparing it to customer lifetime value. A widely used benchmark is that lifetime value should be at least three times CAC; a ratio near or below one means you are paying as much or more to acquire customers than they are worth.
Tracking CAC over time reveals whether your marketing is becoming more or less efficient, and breaking it down by channel shows where to invest. All calculation happens locally in your browser.
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Frequently Asked Questions
What is the CAC formula?
Customer acquisition cost equals total sales and marketing spend divided by the number of new customers acquired in the same period.
What costs should I include?
Include all sales and marketing costs: advertising, salaries, tools, agency fees and commissions, not just ad spend, for a realistic figure.
What is a good CLV to CAC ratio?
A ratio of three to one or higher is widely considered healthy, meaning each customer is worth at least three times what it cost to acquire them.
What does a ratio below one mean?
It means you spend more to acquire a customer than they are worth over their lifetime, which is unsustainable and loses money on each one.
How can I lower CAC?
Improve conversion rates, focus on your most efficient channels, strengthen referrals, and improve targeting to reduce wasted spend.
Privacy & Security
Everything runs in your browser; nothing is uploaded.
How to Use
Enter total sales and marketing spend and new customers acquired.
Disclaimer: This tool is provided "as is" without warranty of any kind. Results are for educational and utility purposes.
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