Client Acquisition Cost (CAC) by Channel Calculator

Compare customer acquisition costs across up to four marketing channels. See which channels deliver the best ROI and find your most efficient acquisition source.

Average revenue from a customer over their entire relationship

CAC = Marketing Spend on Channel / Customers Acquired from Channel; LTV:CAC Ratio = Customer Lifetime Value / CAC
Google Ads: $5,000 spend, 25 customers = $200 CAC. Facebook: $3,000 spend, 10 customers = $300 CAC. Organic: $1,000 spend, 40 customers = $25 CAC. With $5,000 LTV, Organic has 200:1 ratio vs Google Ads at 25:1.

How is CAC calculated by channel?

CAC by channel = Total Marketing Spend on Channel / Number of Customers Acquired from that Channel. This shows the efficiency of each acquisition channel and helps allocate budget to the most cost-effective channels.

What is a good CAC to LTV ratio?

A healthy CAC to LTV ratio is 1:3 or better (CAC should be no more than 1/3 of LTV). For example, if LTV is $3,000, your CAC should be under $1,000. Ratios above 1:1 (CAC equals LTV) indicate unprofitable acquisition that needs optimization.

Which marketing channel typically has the lowest CAC?

Referrals and organic search typically have the lowest CAC because they involve earned media rather than paid. Email marketing and content marketing also tend to have lower CAC over time. Paid ads usually have higher CAC but can scale quickly.

How often should I calculate CAC by channel?

Calculate CAC monthly for tracking trends, quarterly for strategic planning, and whenever launching new campaigns. Regular analysis helps identify underperforming channels early and optimize your marketing budget allocation.