What CAC is
Customer acquisition cost (CAC) is what it costs you, on average, to win a new customer. The formula is simple: what you spent on marketing and sales in a period, divided by the new customers in that same period.
For example: if in a quarter you spend €30,000 across campaigns, tools and the part of your team devoted to acquisition, and you win 60 new customers, your CAC is €500. The hard part isn't the division. It's that the two numbers come from different places and rarely match.
Which costs to include
- Media spend: Google Ads, Meta, LinkedIn and any paid campaign.
- Tools: the CRM, marketing automation and whatever you use to acquire customers.
- People: the share of your marketing and sales salaries spent winning new customers, not serving existing ones.
- Agencies and external partners working on acquisition.
Many companies calculate with media spend only. That "campaign CAC" is useful for comparing channels, but it's far below the real cost and makes acquisition look cheaper than it is.
Why it doesn't add up: marketing and sales count differently
Spend lives in Google Ads and in accounting; leads in GA4 and your form tool; customers in the CRM or ERP. Each system counts its own way:
- Marketing counts conversions in the ad platform; sales counts signed contracts.
- The same customer may arrive through three channels before buying, and each platform claims the sale.
- Dates don't line up: the click is in March, the lead in April and the signature in June.
That's why a reliable CAC comes from joining sources in one place, with an ID that follows the customer from first click to invoice. Without it, every department has its own CAC and none of them is the real one.
How to calculate it by channel, step by step
- 1Join spend and customersBring spend from each platform (Google Ads, Meta…) and won customers from the CRM into one place. A data warehouse such as BigQuery is the usual choice.
- 2Connect the sourceStore in the CRM where each lead came from (UTMs or the Google Ads click ID) so every customer can be attributed to a channel.
- 3Choose an attribution modelFirst touch, last touch or a split across channels. None is "correct": what matters is picking one, writing it down and always using the same one.
- 4Align the datesDecide whether a customer counts in the month of the first click or of the signature, and apply it the same way to spend and customers.
- 5Calculate and compareCAC by channel = channel spend ÷ customers attributed to the channel. Compare it with what a customer is worth.
CAC on its own doesn't tell you if you're doing well
A €500 CAC is excellent if each customer brings in €5,000 and a disaster if they bring in €300. That's why it's read alongside customer lifetime value (LTV): a common benchmark for recurring-service businesses is an LTV of at least three times CAC. And alongside the payback period: how many months it takes a customer to repay what it cost to win them.
Those three numbers together belong on your sales dashboard, calculated once and with the same definition for everyone.
CAC FAQs
Does CAC include salaries?
Full CAC does: the share of the team devoted to acquisition. The media-only version is useful for comparing channels, but it isn't the real cost.
How often should I calculate it?
Monthly to follow the trend and quarterly to make decisions, because with few customers per month the number swings a lot.
Can I calculate it in Power BI or Looker Studio?
Yes, as long as spend and customers are joined underneath with the same definitions. Without that, the dashboard just paints the mess.
What if every platform claims the same sale?
Use your own attribution model on the joined data instead of adding up what each platform reports.
Want your true CAC by channel?
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