Customer Acquisition Cost (CAC)

Excel Formulas › Sales & CRM

All versions

CAC is total sales and marketing spend over the customers it won — what it costs to land a customer. Compared to lifetime value, it tells you whether growth is profitable.

Quick formula: CAC from spend and new customers:
=(sales_cost + marketing_cost) / new_customers
All sales and marketing spend over the new customers acquired in the period.

The example

$60,000 spend, 40 new customers.

AB
1ItemValue
2S&M spend60000
3New customers40 → $1,500

The formula

The formula:

=(B2) / B3 // S&M spend ÷ new customers

How it works

How it works:

  1. Add all sales and marketing cost — salaries, ads, tools, commissions.
  2. Divide by the new customers acquired in the same period for CAC.
  3. Compare to LTV: a healthy LTV / CAC is often 3 or more.
  4. Track CAC by channel with SUMIF to fund what acquires cheaply.

CAC means little without LTV. A $1,500 CAC is great if each customer is worth $6,000 (LTV/CAC = 4) and terrible if they’re worth $1,000. The ratio — and the payback period (how long to recoup CAC) — are what tell you whether to pour more money into acquisition.

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S&M spend and new customers.

CAC:

Variations

LTV to CAC ratio

Health check:

=customer_ltv / CAC

CAC by channel

Where it’s cheap:

=SUMIF(channel, "Paid", spend) / SUMIF(channel, "Paid", customers)

Blended vs paid

Exclude organic:

=paid_spend / paid_customers

Pitfalls & errors

All S&M cost. Include salaries and tools, not just ad spend.

Same period. Match spend to the customers it actually acquired.

Pair with LTV. CAC alone can’t tell you if growth is profitable.

Practice workbook

📊
Download the free Customer Acquisition Cost (CAC) practice workbook
A CAC sheet with the LTV-ratio, by-channel, and blended variants, plus 4 challenges with answers. No sign-up required.

Frequently asked questions

How do I calculate customer acquisition cost in Excel?
Divide sales and marketing spend by new customers: =(sales_cost + marketing_cost) / new_customers.
What's a healthy LTV to CAC ratio?
Often 3 or more — each customer should be worth at least 3× what it cost to acquire them.
How do I find CAC by channel?
Use SUMIF: spend by channel over customers by channel to see which acquires cheapest.

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Related formulas: CAC payback period · Donor lifetime value · ROI & payback