Customer Acquisition Cost (CAC) Calculator

Blended CAC divides everything you spent on sales and marketing by every customer you won, whatever the source. Paid CAC uses only media spend. Blended is the number that tells you whether the business works; paid is the number that tells you whether the ad account is pulling its weight. Reporting paid CAC as though it were the whole cost is how agencies convince themselves acquisition is cheaper than it is.

Salaries and commissions for anyone whose job is winning customers, the tools they use, paid media, content production, freelancers and agency fees, and any events. If you would not spend it in a month where you acquired nobody, it belongs in CAC. Founder time is the one everyone leaves out — if the founder is closing, a share of their cost is acquisition spend.

There is no single figure, which is why the tool compares it to your contract value instead. CAC at or below a third of first-year revenue is the working rule. Typical agency retainers land between roughly $18K and $60K a year, so a $6K CAC is comfortable at the top of that band and painful at the bottom.

Almost always because customers went down, not because spend went up — CAC is a ratio and the denominator is the volatile half. A month with two closes instead of five triples the number without a single change to the ad account. Use a rolling quarter rather than a single month, or you will keep reacting to noise.

That combination points at the sales process, not the media. If more spend is producing the same conversion rate, you are buying more of the same conversations and losing them at the same point. The fix is between the enquiry and the signature — qualification, discovery and follow-up discipline — not another round of creative testing.

Quarterly for the number you act on, monthly for the trend. Anything shorter and small changes in close timing swamp the signal, particularly for agencies where a single large retainer can move the average on its own.