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CMetrics & moneyAlso CACUpdated 2 Nov 2026

Customer Acquisition Cost (CAC)

What you spend in sales and marketing to win one new paying customer.

Definition

Customer acquisition cost is sales and marketing spend over a period, divided by the new paying customers those rupees produced. Blended CAC uses all spend. Paid CAC uses only paid channels. The useful number is the one you can act on.

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In the room

How the word shows up in a real conversation.

You spend ₹3 lakh on ads and ₹1 lakh on a salesperson in a quarter and add 80 paying customers. CAC is ₹5,000. If LTV is ₹8,000, the unit may work. If LTV is ₹4,000, growth hurts.

Formula

CAC = sales and marketing spend ÷ new paying customers

Common mistake

Leaving founder time, discounts, and failed trials out of the spend. That CAC is fan fiction.

See also

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