Customer Acquisition Cost (CAC)

CAC measures the fully loaded cost to win a new paying customer. It transforms marketing and sales spend into unit‑level economics you can optimize.

CAC is the fully loaded cost to acquire one new paying customer in a period.

Match costs and acquisitions by cohort for accuracy. Compare CAC by channel and segment, and judge against margin‑adjusted CLTV and payback to ensure efficiency.

Customer Acquisition Cost is the fully loaded spend required to acquire one new paying customer. Include salaries, tools, ad spend, and program costs for sales and marketing within a consistent attribution window. Compare CAC across channels and segments, and evaluate against CLTV and payback period to ensure growth is efficient. Lower, stable CAC with rising CLTV is a hallmark of scalable motion.

Use fully loaded S&M costs.

Sum fully loaded sales and marketing costs and divide by new paying customers in the period.

$50k spend, 100 new customers → $500 CAC.

Align costs and acquisitions to the same attribution window and cohort to avoid mismatches.

Excluding salaries, mixing signups with customers, or using inconsistent windows misstates CAC.

Target CLTV/CAC ≥ 3 and payback ≤ 12 months for SMB.

Healthy CLTV/CAC ≥ 3 and payback ≤ target months indicate efficient growth.

Compute CAC by channel and segment so budget shifts can target the most efficient paths.

CAC pairs with CLTV, payback period, and CPA to evaluate acquisition sustainability.