Customer Acquisition Cost Calculator

Customer Acquisition Cost (CAC) measures the total cost of winning a new customer. The formula includes all marketing and sales expenses:

For example, if you spent $10,000 on marketing and $5,000 on sales in a month, and acquired 200 new customers, your CAC is $15,000 / 200 = $75 per customer.

Include everything: ad spend, content creation, tools, salaries of marketing and sales teams, agency fees, and software subscriptions. The more honest your CAC calculation, the better your decisions will be.

CAC is the total cost of convincing a potential customer to buy your product or service. It differs from CPA (cost per acquisition) in that CAC includes all marketing and sales costs, not just ad spend for a single campaign.

The most important metric to pair with CAC is Lifetime Value (LTV). The LTV:CAC ratio tells you whether your customer economics are sustainable. A ratio of 3:1 is the widely accepted benchmark — meaning each customer generates 3x more revenue than it costs to acquire them.

Below 1:1, you are losing money on every customer. Between 1:1 and 3:1, you are profitable but have limited room for error. Above 3:1, you have healthy unit economics and can scale aggressively. Above 5:1, you may actually be under-investing in growth.

To reduce CAC, focus on improving conversion rates, increasing organic traffic, leveraging referral programs, and testing ad creative to find what resonates at the lowest cost. For strategies on reducing acquisition costs with paid social, read our guide on Shopify Facebook Ads.