Customer Acquisition Cost (CAC) Calculator
Calculate CAC, payback period, and LTV:CAC ratio
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Formula
Formula
CAC = Total S&M Spend / New Customers. LTV = Monthly Gross Profit / Monthly Churn Rate. Payback = CAC / Monthly Gross Profit. Target LTV:CAC ≥ 3, Payback ≤ 12 months.
CAC measures sales & marketing efficiency. LTV predicts total value from a customer. The LTV:CAC ratio and payback period are key metrics for unit economics. Healthy SaaS: LTV:CAC > 3, Payback < 12 months.
How to Calculate Manually
- 1 Enter marketing, sales, and overhead spend
- 2 Enter number of new customers acquired
- 3 Enter average revenue per customer per period
- 4 Enter gross margin and churn rate
- 5 Calculator shows CAC, LTV, payback, and ratios
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Reference Table
| Business Model | Typical CAC | Target Payback | Target LTV:CAC |
|---|---|---|---|
| B2B Enterprise | $1,000-$10,000+ | 12-18 months | >3:1 |
| B2B Mid-Market | $500-$2,000 | 6-12 months | >3:1 |
| B2C Subscription | $50-$200 | 3-6 months | >3:1 |
| E-commerce | $20-$100 | Immediate | >3:1 |
| SaaS SMB | $200-$800 | 6-12 months | >3:1 |
Customer Acquisition Cost (CAC) is one of the most critical metrics for any business with paid customer acquisition. It tells you how much you spend to acquire each new customer. But CAC alone is meaningless—you must compare it to the customer's Lifetime Value (LTV) to understand if your acquisition strategy is profitable...
Frequently Asked Questions
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What is CAC?
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What's a good LTV:CAC ratio?
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What's CAC payback period?
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