Customer Acquisition Cost (CAC)

Summary

The total cost to acquire one paying customer, including ad spend and often a share of team/tool costs — a foundational number for deciding whether a channel or campaign is actually profitable.

• 1Calculate a rough CAC for a hypothetical campaign given spend and resulting customers.
• 2Learn to compare CAC across channels to see which is most efficient.
• 3Understand why CAC alone is meaningless without comparing it to customer lifetime value.