cust.co / Glossary / Customer Acquisition Cost (CAC)

Customer Acquisition Cost (CAC)

Total sales + marketing spend required to acquire one new customer.

Also known as: CAC, Acquisition Cost

Definition

CAC is the fully-loaded cost of acquiring a new customer - sales rep comp, marketing spend, demo infrastructure, allocated. Calculated as total S&M spend / new customers acquired in the same period. CAC informs unit economics: paired with LTV (LTV:CAC ratio), gross margin, and churn, it tells you whether each new customer is profitable.

Formula

Sales + Marketing spend / New customers acquired

Related terms

Customer Lifetime Value (LTV) →LTV:CAC Ratio →CAC Payback Period →

Benchmark your Customer Acquisition Cost (CAC)

See how public B2B SaaS companies disclose this metric, with full historical time series.

Explore company profiles → Compute your NRR →