Customer acquisition cost (CAC) calculator.
Marketing spend ÷ new customers. Then compare against LTV. Know whether growth is making you richer or poorer.
Per period
Use a full month or quarter. Include all marketing — ads, agencies, content, the lot.
Customer acquisition cost
CAC without LTV is meaningless.
Customer acquisition cost (CAC) on its own tells you nothing. €50 is great for a luxury watch business; lethal for a coffee subscription. The only number that matters is the ratio of LTV to CAC.
The formula
CAC = marketing spend ÷ new customersLTV : CAC ratio = LTV ÷ CAC
What "marketing spend" actually includes
All of it. Ad spend, agency fees, content production, influencer payments, marketing software subscriptions, conferences. The most common mistake is excluding people costs (your time, freelancers, your in-house marketer). If you only count ad spend, you'll have a flatteringly low CAC that hides a real money pit.
The ratio thresholds
Under 1:1 — you lose money on every customer. Stop spending until economics work. 1:1 to 3:1 — break-even-ish. Healthy room for cost growth and customer attrition is missing. 3:1+ — healthy. Scale the channels that hit it. 5:1+ — you're probably under-investing. Try increasing budget to capture more of the addressable market.
How to lower CAC
Two paths. Improve conversion (better landing pages, faster checkout, social proof) — same traffic, more customers. Or fix the targeting (narrower audience, better keywords, cleaner segments) — fewer wasted clicks. Both beat "spend less on ads," which usually just slows growth without fixing the underlying inefficiency.