CAC: definition
Customer acquisition cost: what you spend on average (ads, time, tools) to land one new paying customer.
By Mathéo Ballasse · May 8, 2026
Definition
CAC adds up all acquisition spend over a period, divided by the number of customers gained. It is the compass for a channel's profitability: a channel is only viable if the CAC stays below what a customer brings you over their lifetime. You track it channel by channel to know where to put budget back.
How to calculate it
CAC = (marketing spend + sales spend over the period) / number of customers gained
Why it matters
Without CAC, you are flying blind: you don't know whether a channel is making or losing you money. Putting it side by side with LTV tells you how fast you can reinvest and which of your channels deserve to be pushed harder.
When to use it
You calculate it per channel, at regular intervals, as soon as you spend to acquire. The classic trap is forgetting the cost of human time (yours, a salesperson's): a channel that's "free" in euros can have a high CAC in hours.
Example
If you spend 2,000 euros on ads in a month and sign 10 customers, your ads CAC for the month is 200 euros.
Common mistakes
- Forgetting the cost of human time (yours, a salesperson's).
- Calculating it globally instead of channel by channel.
- Reading it without putting it side by side with LTV.
Don't confuse it with
- ltv: CAC is what a customer costs; LTV is what they bring in. You always compare the two.
What our data says
Related terms
Articles that use this term
Frequently asked questions
- What CAC is acceptable for a SaaS?
- The common rule: an LTV at least 3 times the CAC, and a payback period under 12 months.