glossary
CAC
Customer Acquisition Cost — the fully loaded sales and marketing spend required to win one new customer, usually paired with LTV.
By The Marketinque TeamReviewed June 2026
"Fully loaded" is what makes CAC honest. The numerator is not just ad spend: it includes marketing and sales salaries, agency fees, tools, and content production over the period. Dividing by the customers won in that same period gives the true cost of one new logo.
Most teams track two flavors. Blended CAC divides all spend by all new customers; paid CAC divides paid spend by paid-attributed customers. Blended tells you whether the business model works; paid tells you whether the channel does. A low blended CAC can hide a wildly unprofitable paid program — and the reverse.
CAC means little on its own; it is half of a ratio. Pair it with LTV to see whether customers ever repay their acquisition cost, and with payback period to see how fast. The CAC & LTV calculator computes the ratio, payback months, and a health verdict from your numbers.
formula
CAC = total sales & marketing spend ÷ new customers acquired
worked example
$90,000 of marketing spend plus $60,000 of sales cost in a quarter that closed 50 customers gives a CAC of $3,000. If those customers are worth $9,000 over their lifetime, the 3:1 LTV:CAC ratio sits right at the conventional healthy floor.
Related terms
Sources
- David Skok, SaaS Metrics 2.0 (forEntrepreneurs)
- Andreessen Horowitz, 16 Startup Metrics (2015)
Compiled by The Marketinque Team to our editorial standards.