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Customer Acquisition Cost Calculator
Work out your CAC from sales and marketing spend, then see your LTV to CAC ratio and payback period. Enter your numbers and press Calculate.
Written by TopicDrill Editorial Team·Updated June 2026
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How the CAC calculator works
The core formula is straightforward: add all of your sales and marketing spend for a period, then divide by the number of new customers you won in that same period. The result is the average cost to acquire one customer.
Add your average revenue per customer and gross margin and the calculator also estimates a simple lifetime value, your LTV to CAC ratio and how many months of gross profit it takes to pay back the acquisition cost. Those three numbers together show whether your growth is efficient.
A quick example
Spend $20,000 on marketing and $10,000 on sales to win 150 customers and your CAC is $200. If each customer brings $50 a month at a 70% gross margin, that is $35 of monthly gross profit, a payback period of about 5.7 months and a healthy LTV to CAC ratio.
Things to keep in mind
CAC is only useful next to lifetime value, so always look at the ratio rather than the cost alone. Include fully loaded costs such as salaries and tools, not just ad spend. For more on building a business, the U.S. Small Business Administration is a helpful resource. You can also explore our other free calculators.
Frequently asked questions
What is customer acquisition cost?
Customer acquisition cost, or CAC, is the average amount you spend to win one new customer. You calculate it by adding all sales and marketing spend over a period and dividing by the number of new customers acquired in that same period.
What is the LTV to CAC ratio?
It compares the lifetime value of a customer to what it cost to acquire them. A ratio of 3 to 1 is a common benchmark for healthy unit economics. Below 1 to 1 you lose money on each customer, and a very high ratio may mean you are underinvesting in growth.
What is CAC payback period?
It is how many months of gross profit from a customer it takes to recover their acquisition cost. A shorter payback period means you recover your spend faster and can reinvest sooner. Many software businesses aim for under 12 months.
How can I lower my CAC?
You can lower CAC by improving conversion rates, focusing spend on the channels that perform best, leaning on referrals and content, and shortening the sales cycle. Tracking CAC by channel helps you shift budget toward the most efficient sources.
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