Business Term
CAC
Customer Acquisition Cost
CAC
CAC is the sales and marketing cost required to acquire one customer.
Formula
CAC = sales and marketing acquisition cost / new customers
Use when
Use it when deciding marketing spend, sales hiring, and channel investment.
Watch out
Advertising, sales labor, marketing spend, acquisition tooling
Updated: 06/27/2026Quality: ReviewedSources: 1
What it means
CAC is a unit-economics metric for how efficiently growth spend turns into customers. It should be read with LTV, gross margin, and payback.
How to calculate it
| Lens | Formula / treatment | When to use it |
|---|---|---|
| Basic formula | CAC = sales and marketing acquisition cost / new customers | Measures acquisition cost per customer |
What counts / what does not
| Item | Treatment | Why it matters |
|---|---|---|
| Include | Advertising, sales labor, marketing spend, acquisition tooling | They fund acquisition |
| Exclude | Customer support, product development, G&A | They are not direct acquisition spend |
What moves the number
| Driver | Metric impact | What to watch |
|---|---|---|
| Channel efficiency | Conversion by ads, referrals, sales | Strongly moves CAC |
| Price and sales cycle | Higher ACV often requires more effort | Read with payback |
When it helps
- Use it when deciding marketing spend, sales hiring, and channel investment.
How to use it
- Fix the period, cost scope, and new-customer definition before comparing.
Decision cautions
- Do not judge CAC alone; pair it with LTV and gross-margin payback.
Example
Example: 10 million yen of acquisition spend for 100 customers gives CAC of 100,000 yen.
Compare with
| Metric | Difference | Why read together |
|---|---|---|
| LTV | Value from a customer | CAC is the cost to acquire the customer |
Common mistakes
- Mixing brand or existing-customer spend can distort acquisition efficiency.
Frequently asked questions
Is lower CAC always better?
Usually, but low-CAC customers with weak LTV or retention may still be poor investments.
Sources
| Sources | Kind | Link |
|---|---|---|
| YogoQ Core business foundation editorial baseline | editorial | — |