Customer acquisition cost (CAC)
Acquisition metric. How do users find and install the app?
What is customer acquisition cost?
Customer acquisition cost (CAC) is the total cost of winning one new customer: acquisition spend in a period divided by the new customers gained in that period.
Customer: the user state you decide counts as acquired, usually a first payment; for free apps, sometimes an activated user.
Blended: calculated across paid and organic users together, so organic users lower the average cost.
How to calculate CAC
CAC = Total acquisition cost ÷ New customers- Total acquisition cost
- media spend plus, depending on the variant, creative, tools, agency fees and team costs
- New customers
- users who became customers in the period, as you define a customer (usually a first payment)
Where definitions differ
| Variant | Formula | When to use it |
|---|---|---|
| Paid CAC | Paid media ÷ New customers attributed to paid media | Shows the efficiency of paid channels only. |
| Blended CAC | All acquisition cost ÷ All new customers, organic included | Lower than paid CAC; useful for company-level planning. |
| Fully loaded CAC | Media + creative + tools + agency + team costs ÷ New customers | The version finance teams usually want to compare with LTV. |
By channel: Paid CAC by channel depends on knowing which customers each channel brought in, so it needs installs and first payments attributed to a source; MMPs such as Linkrunner, AppsFlyer and Adjust record this.
CAC calculator
Example inputs: change them to your own numbers. The examples only make the calculator show a worked answer; they are not benchmarks or targets. Runs in your browser; nothing you type is sent anywhere.
- Fully loaded blended CAC
- $25
- Paid media CAC
- $26.67
- Share of customers from paid media
- 75%
What is the difference between CPI and CAC?
CPI prices an install; CAC prices a customer. Because only some installs become customers, CAC is normally many times higher than CPI, and CAC is the figure to compare with lifetime value.
How CAC differs by vertical
| EdTech | A customer is a paying learner, so CAC climbs when courses are sold after a long free trial. |
|---|---|
| Fintech | A customer is often a funded account or first transaction; KYC drop-off is what drives CAC up. |
| OTT and streaming | A customer is a subscriber, and CAC is read against months to payback. |
| Gaming | Rarely used for payers, because most players never pay; games lean on CPI and ROAS instead. |
Common mistakes
- Counting installs or sign-ups as customers, which makes CAC look like CPA.
- Leaving out creative, agency and tool costs, then comparing with a fully loaded LTV.
- Reading blended CAC as paid efficiency when organic customers are pulling it down.
Questions
How do you calculate CAC for an app?
Add up the acquisition costs for the period and divide by the new customers gained in it. Decide first what a customer is and which costs you include, and keep both fixed so the figure is comparable month to month.
Should CAC include salaries?
For a fully loaded CAC, yes: the marketing team's cost is part of acquiring customers. Many teams track paid CAC weekly and fully loaded CAC monthly or quarterly.
Why is blended CAC lower than paid CAC?
Blended CAC divides all costs by all new customers, including organic customers who cost nothing in media. The more organic customers you have, the bigger the gap.
Why do tools report different values for the same metric?
Because definitions differ: what counts as active, which attribution window applies, whether organic users are included and how days are cut by timezone. Align the definition before comparing numbers.
Which currency do the calculators use?
The calculators show US dollars, but every formula works in any currency: enter your own figures in the currency you report in and read the results in that currency.
What is the difference between a metric and a KPI?
A metric is any measured quantity; a KPI is a metric a team has chosen as a target for judging performance. Most metrics here become KPIs only for the teams whose work moves them.