What is Customer Acquisition Cost (CAC)
Customer Acquisition Cost (CAC for short) is the average amount a company spends to acquire a single new customer. This metric includes all costs associated with acquisition – not just the advertising budget, but also the salaries of the marketing and sales teams, software, events and content costs.
Calculating CAC:
CAC = total marketing and sales costs / number of new customers acquired over a specific period
E.g.:
If a company invested CZK 300,000 in marketing and sales over a quarter and acquired 15 new customers:
CAC = 300,000 / 15 = CZK 20,000
Why CAC is important for B2B companies
- It helps evaluate the effectiveness of acquisition activities
You can easily compare different channels and campaigns based on their cost-effectiveness. - It allows you to compare costs with customer lifetime value (CLV).
If CAC is higher than Customer Lifetime Value, the strategy is unsustainable. - It increases profitability through optimisation A
lower CAC (while maintaining lead quality) means higher margins and returns. - Supports decision-making on budgets and investments.
It helps allocate the budget to channels that actually work. - It allows you to measure the performance of both sales and marketing teams.
Combined with other metrics (e.g. conversion rate, CLV), it provides a comprehensive picture of performance.
Practical applications and examples
- AITOM Digital
Measures CAC for every campaign – for example, for the RevOpsCon event, it compares the number of registrations and new orders against total costs → helping to optimise the format and promotion. - SaaS company
Found that CAC for Google Ads is CZK 9,500, whilst for partnerships it is only CZK 4,200 → increased the budget for partnerships. - Manufacturing company
Tracking CAC in combination with CLV revealed that small customers have higher acquisition costs than large ones → change in targeting strategy. - Consultancy agency:
Calculated CAC based on consultants’ working hours spent acquiring a new client → adjusted pre-sales processes and reduced costs by 30%. - B2B e-shop
Thanks to regular CAC measurement, it found that remarketing delivers the cheapest conversions → expanded the remarketing budget.
5 tips for optimising CAC in a B2B company
- Focus on qualified leads
Better to have fewer but precisely targeted contacts – higher conversion rates and lower losses in the funnel. - Automate parts of the acquisition process
Marketing automation can reduce costs at every stage of the acquisition process. - Improve collaboration between marketing and sales
When both teams work towards the same goal, efficiency increases and costs decrease. - Track CAC by channel and segment
It’s not just about the overall figure – data granularity is also important. - Compare CAC with CLV
Metrics must be viewed in context – a high CAC can be acceptable if you have a high customer lifetime value.
Related terms
- CLV (Customer Lifetime Value) – customer lifetime value
- ROI (Return on Investment) – return on investment
- Lead Generation – the process of acquiring leads that lead to CAC
Further resources
- HubSpot – What is Customer Acquisition Cost (CAC)?
- ProfitWell – How to Calculate and Reduce CAC
- For Entrepreneurs – CAC: The One Number You Need to Know
Summary
Customer Acquisition Cost is a metric that tells you how much it actually costs to acquire a new customer. In a B2B environment, understanding and optimising this metric is key to profitable growth. If you want to calculate your own CAC, compare it with CLV, or devise a strategy to reduce it, please do not hesitate to contact us.