CAC Calculation Mistakes: The Timing Problem

CAC calculation seems simple but timing errors are common. The wrong approach can make unprofitable channels look great.

The Timing Mismatch

Marketing spend today generates customers months later. Dividing this month spend by this month customers creates misleading CAC.

Match spend to the customers it generated. Use cohort-based attribution: January spend divided by customers who started evaluating in January.

Include all customer acquisition costs: marketing, sales salaries, tools, agencies, events. Exclude customer success and support costs.

Track both overall blended CAC and channel-specific CAC. Blended shows efficiency trends; channel CAC guides budget allocation.

Use sales cycle length. If your cycle is 60 days, customers acquired in March came from January marketing spend.

Yes, include sales and marketing salaries. Some companies also include a portion of executive time spent on sales/marketing.

Accurate CAC requires proper timing attribution. Without it, you cannot make good decisions about where to invest in growth.