Enter your total sales and marketing spend and the number of new customers acquired to calculate your CAC instantly. One of the most important unit economics metrics for any growing business.
Customer Acquisition Cost is the total amount your business spends to acquire one new customer, including all sales and marketing expenses for the period. CAC is one of the most important unit economics metrics because it tells you whether your growth is efficient -- whether you are spending a dollar to earn two or spending a dollar to earn fifty cents. High CAC relative to customer lifetime value is the most common hidden cause of cash flow problems in growing businesses that look healthy on revenue but are quietly unprofitable on a per-customer basis.
CAC only has meaning in relation to your customer lifetime value (LTV). The most common target for healthy unit economics is an LTV:CAC ratio of at least 3:1. If a customer is worth $750 over their lifetime and costs $250 to acquire, your growth is sustainable. If they are only worth $200, you are losing money on every customer. Calculating CAC monthly and comparing it to LTV over time is one of the most reliable ways to spot a growth model that is working versus one that is quietly burning cash.
Breaking CAC down by channel -- paid search, organic, referral, events, outbound -- is more useful than a blended average. Your overall CAC might be $250, but organic search customers might cost $80 while paid social customers cost $420. Channel-level CAC tells you where to invest more and where to cut. Track channel spend separately in your records so you can run this calculation per channel each quarter.
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