Signal PPC

CAC Calculator

Calculate your customer acquisition cost (CAC) from total acquisition costs and the number of new customers acquired.

Include every cost involved in acquiring customers over the period you're measuring — ad spend, sales and marketing salaries, agency or tooling fees, content and creative production, and any sales commissions tied to new customers. CAC is meant to be a fully loaded figure, not just media spend. If you only want ad spend divided by conversions, use the CPA Calculator instead.
The number of net-new customers acquired over that same period.

Formula

CAC = Total Customer Acquisition Costs ÷ New Customers Acquired

What to include in "total acquisition costs" is the part most people get wrong. A fully loaded CAC includes:

  • Paid advertising spend
  • Sales and marketing salaries (or the relevant share of them)
  • Agency, freelancer, or software/tooling costs tied to acquisition
  • Content, creative, or production costs for acquisition campaigns
  • Sales commissions paid on new customer deals

Leaving out labor and tooling costs — counting only ad spend — will understate CAC and make growth look cheaper than it is.

Worked Example

Suppose a team spends $8,000 on ads, $4,000 on marketing salaries, and $1,000 on tools in a month, for a total of $13,000, and acquires 65 new customers. CAC = $13,000 ÷ 65 = $200.00.

Compare CAC against customer lifetime value, not a single order's margin, to judge whether this is sustainable — a $200 CAC can be excellent or unsustainable depending on what a customer is worth over time.

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