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metrics

CAC (Customer Acquisition Cost)

Total cost to acquire a new customer.

CAC (Customer Acquisition Cost) measures the total amount spent to acquire a new customer. This metric includes all marketing and sales costs: advertising, sales team salaries, tools, events, content marketing, etc. It's a fundamental metric to evaluate the effectiveness of your acquisition strategy.

Formula

CAC = (Marketing Costs + Sales Costs) / New Customers

CAC is calculated by dividing the sum of all acquisition costs (marketing, sales, tools) by the number of new customers acquired over the same period. Important: include ALL costs, including salaries.

Concrete Example

A startup spending $10,000/month on marketing and $5,000/month on sales to acquire 50 new customers.

CAC = ($10,000 + $5,000) / 50 = $300

Each new customer costs $300 to acquire.

SaaS Benchmarks

< $100Excellent - Very efficient acquisition
$100 - $500Good - Room to maneuver
$500 - $1,000Average - Needs optimization
> $1,000High - Rethink strategy

Tips

  • Content marketing reduces CAC long-term
  • Analyze CAC by channel to optimize the mix
  • Referral typically has the lowest CAC
  • Automate repetitive tasks to reduce sales costs

Common Mistakes

  • Forgetting sales and marketing team salaries
  • Not including tools and software
  • Comparing CAC without context (B2B vs B2C)

Calculate your CAC

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Related Terms

LTVLTV CAC RATIOPAYBACK PERIODCONVERSION RATEMQL

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