
When asked about measuring the ROI of marketing initiatives, we recommend starting with the Customer Acquisition Cost (CAC). This figure, along with Customer Lifetime Value (Customer LTV or CLV), are essential indicators in B2B marketing analytics.
Your CAC alone reveals two key insights:
- Which marketing channels warrant increased or decreased investment.
- The strengths and weaknesses of your marketing team. You can gauge these strengths by comparing your CAC with industry standards.
This article aims to clarify what constitutes a competitive CAC within your sector. It might also be useful to compare your CAC with those of related sectors to determine if your expenses are in line with broader B2B market trends.
Calculating your Customer Acquisition Cost.
To compute your CAC, simply divide your total marketing and sales expenditures by the number of new customers you’ve acquired, as per the formula below:

This calculation is best performed on an annual or rolling annual basis to mitigate any seasonal variations in customer acquisition. For B2B companies with steady sales year-round, evaluating CAC quarterly can provide insights into the effects of new marketing or sales strategies.
You can also calculate CAC for each marketing channel separately, allowing for a comparison of different channels’ effectiveness.
After computing your CAC, you can then compare it to the following industry benchmarks.
Average Customer Acquisition Cost (CAC) by sector.
Below is a table showing average CACs across 29 B2B industries. Here are some caveats about our data:
- We present two types of CAC for each industry: Organic and Inorganic. Organic CACs are mainly from SEO and organic social media, while Inorganic CACs are from PPC/SEM and paid social media.
- Our analysis excludes CACs from email marketing, in-person events, direct mail, outdoor advertising, and other lead-generation methods due to data limitations.
- All data is sourced anonymously from client analytics. Inorganic CAC data leans more toward PPC/SEM than paid social. The overall Average CAC is calculated with a 75% weight for organic and 25% for inorganic sources.

Average Customer Acquisition Cost (CAC) for SaaS companies.
We have also reviewed average customer acquisition costs across 22 SaaS sectors to determine the typical B2B CAC for each.

How your CAC relates to customer lifetime value (LTV).
Your CAC indicates the cost to acquire a new customer, whereas the customer’s lifetime value (LTV) shows the average profit each customer generates. The simplest way to calculate this is to divide your monthly or annual profit by the number of unique customers during that period. Multiply this by the number of years a customer typically continues purchasing from your company to get your average customer LTV.
You should aim for an LTV that is at least three times your CAC to ensure a healthy margin, preventing any overspend on marketing. This ratio should also be considered in light of historical trends and competitor data for context. For instance, if your LTV to CAC ratio is 2:1 but shows significant growth compared to past trends, this doesn’t necessarily mean you should decrease your marketing budget to lower your CAC. In such cases, your LTV is likely to increase as new customers become repeat buyers.
This is particularly important if you’ve recently started a new marketing campaign or a long-term strategy, like PPC, which may take 4–6 months to show results. Initially, your LTV to CAC ratio may drop, but it should rise as the campaign progresses and continues to deliver results over time.
How to reduce your CAC.
If you’re interested in leveraging digital marketing to reduce your CAC, feel free to contact us. We have a track record of helping businesses in various B2B sectors achieve higher ROI through PPC than any other lead generation method.

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