Customer Acquisition Cost (CAC) Calculator

Customer Acquisition Cost (CAC): 0.00

What is Customer Acquisition Cost (CAC)?

Customer acquisition cost (CAC) is the total average cost of acquiring a new customer. It is an important marketing metric that represents the spend efficiency of your customer acquisition efforts.

How to Calculate CAC

The formula to calculate customer acquisition cost is:

CAC = Total marketing costs / Number of new customers acquired

For example, if you spent $100,000 last quarter on marketing activities and acquired 2,500 new customers in that period, the CAC would be:

CAC = $100,000 / 2,500 new customers = $40

This means you spent $40 on average to acquire each new customer in that quarter.

Marketing costs that factor into CAC include:

  • PPC/SEM ad spending
  • Social media advertising
  • Content marketing
  • Email marketing
  • Commission fees
  • Promotions and discounts

CAC Formula

CAC = Total marketing spend / New customers acquired

Tracking CAC Over Time

To identify trends, track your CAC over sequential periods of time such as months or quarters. For example:

  • Jan CAC = $30
  • Feb CAC = $40
  • March CAC = $35

This shows an increasing cost trend in Feb, then a reduction in March.

How to Improve Your Customer Acquisition Cost?

  • Automate repetitive marketing tasks to decrease overhead
  • Focus spend on high conversion channels
  • Leverage organic reach through SEO and content marketing
  • Analyze competitors’ CAC for comparison
  • Offer free trials or discounts to boost conversions
  • Use referral programs to reduce paid acquisition costs

Ideal CAC Range by Industry

Strive for a CAC lower than the following industry benchmarks:

  • SaaS – $200
  • Ecommerce – $100
  • Lead Gen – $50

Getting your CAC within the ideal range for your industry is key for maximizing marketing ROI. Use our CAC calculator tool to track your progress.