CAC (Customer Acquisition Cost)
The total cost a business spends to acquire one new customer.
Full definition
CAC includes all sales and marketing spend (ads, content, team salaries, tools) divided by new customers acquired in the same period. Healthy SaaS businesses target CAC payback periods of 12 months or less. CAC is a critical lever in unit economics: high CAC requires high lifetime value to remain profitable. Outbound sales typically has higher CAC than inbound but can support higher contract values.
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