Customer acquisition cost calculator
Enter your spend and customer numbers to see your customer acquisition cost, your LTV to CAC ratio, and your CAC payback period. The numbers stay in your browser. Nothing is sent anywhere.
It costs $1,500 to win a customer worth $6,000 over their lifetime.
What is customer acquisition cost
CAC, or customer acquisition cost, is what it costs you to win one new customer. You take everything you spent on sales and marketing in a period and divide it by the new customers you acquired in that same period.
CAC on its own only tells half the story. Set it against what a customer is worth over time, and how fast you earn that spend back, and you get a real read on whether your growth is healthy or you are paying too much for each new logo.
How to calculate CAC
The formula is sales and marketing spend divided by new customers acquired. If you spent 60,000 dollars in a month and won 40 new customers, your CAC is 1,500 dollars per customer.
From there, LTV to CAC ratio is average customer lifetime value divided by CAC. A 6,000 dollar lifetime value against a 1,500 dollar CAC gives a ratio of 4 to 1. CAC payback in months is CAC divided by average monthly revenue per customer. At 250 dollars a month, a 1,500 dollar CAC pays back in 6 months.
How to lower your CAC
Cut spend on channels that bring in customers who churn fast or never close, and put more budget behind the sources that actually convert. Track CAC by channel and by rep so you know where the real efficiency is, and watch LTV to CAC and payback alongside it so you are not just chasing a cheaper cost per logo.
The hard part is trusting the spend, revenue, and customer counts behind these numbers. If your CRM does not match how your team actually attributes deals and tracks revenue, CAC and LTV are guesses. A CRM built around your real workflow keeps this data trustworthy.
What is a good LTV to CAC ratio and CAC payback
Two numbers tell you whether your CAC is healthy: your LTV to CAC ratio, and how many months it takes to earn that CAC back through revenue.
| LTV to CAC ratio | What it signals |
|---|---|
| Below 1 to 1 | You are losing money on every customer. Fix pricing, spend, or retention before you scale further. |
| 1 to 1 up to 3 to 1 | Thin or underinvested. Growth works, but there is little room to absorb higher costs or slower sales. |
| Around 3 to 1 | A commonly cited healthy range. Spend and lifetime value are roughly in balance. |
| Above 5 to 1 | Strong on paper, but it can also mean you are underinvesting in growth and leaving market share on the table. |
These are general ranges to orient you, not a guarantee. Your numbers depend on your market, pricing, and how you sell. As a rough guide, CAC payback under 12 months is strong, 12 to 18 months is typical for many B2B companies, and payback past 24 months is worth a closer look.
How to lower your CAC
Tighten targeting
Narrow who you spend to reach so you stop paying to attract people who were never going to buy. Fewer, better fit leads usually beat more, worse fit leads.
Raise conversion at each step
A small lift in close rate lowers CAC without spending an extra dollar. Find where deals stall and fix that step before you add more spend.
Cut or fix underperforming channels
Track CAC by channel and by rep, then pause or rework the sources that bring in customers who churn fast or never close.
Shorten CAC payback
Get new customers to value faster with a tighter onboarding process, so the revenue that repays your CAC arrives sooner.
Grow LTV through retention
Retention and expansion revenue raise lifetime value without touching acquisition spend, which improves your LTV to CAC ratio even if CAC stays flat.
Trust the underlying data
CAC and LTV are only as good as the spend, revenue, and deal data behind them. A CRM that matches your real sales process keeps that data attributable and accurate.
Frequently asked questions
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A CRM that keeps your CAC and LTV honest
We build a custom CRM around your real pipeline, so spend, revenue, and closed deals line up by channel and period. No per seat fees. Typical savings of 5x to 10x on your current CRM bill.