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Miraç Özdemir
Digital Marketing Metrics

Customer Acquisition Cost (CAC) and Lifetime Value (CLV) Calculator

Calculates customer acquisition cost (CAC) from marketing spend, customer lifetime value (CLV) from purchase data, the LTV/CAC ratio and the CAC payback period.

Version 1

Things to keep in mind:

  • CLV is undiscounted and assumes constant values; order value, frequency and lifespan change over time.
  • CAC covers only the costs you enter; excluding branding, tools and team costs understates it.
  • Blended and channel-level CAC differ; separating organic from paid changes the result.
  • Include returns and discounts in the margin.

Calculator

Acquisition

TRY

Advertising and marketing spend to acquire customers in the period (TRY).

TRY

Optional: sales salaries/commissions and other acquisition costs for the same period (TRY).

Number of new customers won in the same period (at least 1).

Customer value

TRY

Average spend per purchase (TRY, VAT-exclusive).

How many times a customer buys per year on average.

Gross profit percentage after product cost, commission and shipping.

Customer lifespan input

Enter lifespan in years or derive it from the annual churn rate.

How many years a customer keeps buying on average.

After the first calculation, the result updates automatically when you change a value.

Result

Enter the values and press Calculate to see the result here.

About this tool

Customer acquisition cost (CAC) shows what you spend to win a new customer; customer lifetime value (CLV) shows the gross profit a customer will bring over their lifetime. The ratio of the two tests whether your marketing spend is sustainable.

Formulas

  • CAC = (Marketing spend + Sales/other acquisition cost) / New customers
  • Annual revenue = Average order value × Purchases per year
  • Annual gross profit = Annual revenue × Gross margin / 100
  • Lifespan = entered in years or 100 / annual churn rate (%)
  • Lifetime revenue = Annual revenue × Lifespan
  • CLV = Annual gross profit × Lifespan
  • LTV/CAC = CLV / CAC
  • Payback (months) = CAC / (Annual gross profit / 12)

CLV is an undiscounted simple sum of gross profit. Amounts are rounded to cents and ratios to 2 decimals (payback to 1 decimal), half up (HALF_UP). New customers must be at least 1; with zero annual gross profit the payback shows 0.

Example 1 (lifespan in years): 80,000 marketing + 20,000 sales cost for 400 new customers: CAC 250.00. Order value 500, 4 purchases a year, 30 % margin and a 3-year lifespan: annual revenue 2,000.00, annual gross profit 600.00, lifetime revenue 6,000.00, CLV 1,800.00, LTV/CAC 7.20, payback 5.0 months.

Example 2 (lifespan from churn): 150,000 marketing for 300 new customers: CAC 500.00. Order value 350, 6 purchases a year, 25 % margin and 40 % annual churn give a lifespan of 100 / 40 = 2.50 years; annual gross profit 525.00, CLV 1,312.50, LTV/CAC 2.63 and a payback of 11.4 months.

How to read the result: CAC is the cost of winning a customer; CLV is the total gross profit expected from that customer. If LTV/CAC is below 1 you lose money per customer. A commonly cited rule of thumb is an LTV/CAC of about 3 or more; it is not a legal or mandatory value. Payback shows in how many months the acquisition cost is recovered from gross profit; a short payback matters for your cash flow. CAC covers only the costs you enter, and CLV assumes constant values: order value, frequency and lifespan change over time.

How to use

  1. Enter period marketing spend, any sales cost and the number of new customers won.
  2. Enter average order value, purchases per year and gross margin.
  3. Enter customer lifespan in years or via churn rate.
  4. Press Calculate.

Notes

CLV is an undiscounted simple sum of gross profit (no cash-flow discounting). Amounts are rounded to 2 decimals and ratios HALF_UP (payback to 1 decimal). With zero gross profit the payback shows 0.

Sources

Frequently asked questions

5 questions

  1. Total acquisition spend in a period divided by the new customers won in that period. For example, 80,000 marketing and 20,000 sales cost for 400 customers give a CAC of 250.00.

Next step

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