Unit economics
CAC
Everything spent to acquire customers in a period, divided by the number of customers that spending actually produced.
Also called Customer acquisition cost · Стоимость привлечения клиента
Formula
CAC = (Marketing spend + Sales cost) ÷ New customers acquired
- Marketing spend
- media, agency fees, tooling, content production and the salaries of the people doing it
- Sales cost
- salaries, commission and the tooling of anyone who closes
- New customers
- first-time payers, not leads and not repeat orders
Blended CAC divides by every new customer including those who arrived organically. Paid CAC divides paid spend by the customers paid media produced. They answer different questions and are routinely confused.
CAC is the price of a customer, and it is only useful next to two other numbers: what that customer is worth over their life, and how long the money takes to come back. On its own it is a cost with no scale.
It also rises with volume, and rarely in a straight line. The cheapest demand is bought first — brand search, warm audiences, the people already looking. Each increment after that costs more, which is why a channel that works at AED 60,000 a month can stop working at AED 200,000 without anything else changing.
- Paid media
- AED 60,000
- Agency and tooling
- AED 14,000
- Salaries of the two people running it
- AED 26,000
- New customers, all sources
- 250
- New customers attributable to paid
- 140
Blended CAC = 100,000 ÷ 250 = AED 400. Paid CAC = 100,000 ÷ 140 = AED 714. The same month reports either number depending on which question is being asked, and quoting one while meaning the other is how a channel gets scaled into a loss.
Salaries, agency retainers, production and tooling are part of the cost of acquiring a customer whether or not they sit in the ad account. Leaving them out routinely understates CAC by thirty to fifty per cent, which is exactly the margin by which a channel is declared profitable.
Quantities derived from the counts. Each is only as sound as the definitions beneath it.
Is an input to
- Unit economics
- What one unit of the business earns and costs, measured so that the answer to “should we sell more of this” is arithmetic rather than opinion.
- Marginal CAC
- What the next customer costs rather than what the average one cost — the only version of CAC that answers whether to spend more.
- LTV : CAC
- The ratio of what a customer is worth to what they cost — a sanity check on the model, not a target to optimise.
- CAC payback period
- How many months of a customer's contribution it takes to earn back what they cost to acquire.
An error in this figure does not stay in it. It reaches four numbers above it, and each of those is quoted as though it were measured.
A definition proves nothing. These are the places on this site where this quantity was actually computed, with the period and whose figure it is stated beside each one.
AED 278 to acquire one paying student, against an average enrolment of AED 8,900.
AED 1,111 of test spend, AED 35,600 back · 30 April 2025 · our measurement
A definition is free. Being answerable for the figure it produces is the part that is bought, and this term is a working part of the engagements below.
- Taking a product into a new market
- A campaign can only sell what the market is allowed to buy.
- Digital marketing for Dubai and the UAE
- Spend follows contribution margin, not volume.
The definitions are the easy part. Whether the figure on your dashboard was computed this way is a different question, and usually the more expensive one.