CAC Payback Calculator
CAC payback is how many months of gross profit from a customer it takes to earn back what you paid to acquire them.
What is CAC payback period?
Payback months = CAC ÷ monthly gross profit per customer. Shorter payback means cash comes back faster and growth can be funded from revenue.
How to use the CAC payback calculator (formula)
What each field means
- Customer acquisition cost — Customer acquisition cost.
- Average order value — Average order value.
- Orders per customer per month — Average orders per customer per month.
- Gross margin — Gross margin percentage.
Worked example
Using these numbers: customer acquisition cost $40.00, average order value $35.00, orders per customer per month 0.6, gross margin 50%.
The cac payback period is 3.8 months.
- Gross profit per customer per month: $10.50
What is a good CAC payback?
Under 12 months is a common target; ecommerce brands relying on first-order profit aim for payback on the first order.
Tips to improve your result
- Shorter payback means safer scaling.
- Raise AOV or margin to shorten payback.
- Retention offers speed up payback.
- Compare payback by channel.
Frequently asked questions
How do I calculate CAC payback?
CAC ÷ (AOV × orders per month × gross margin).
Why does CAC payback matter?
It shows how long cash is tied up in each new customer.
CAC payback vs LTV?
Payback is time to recover CAC; LTV is total value over the relationship.
How can I shorten payback?
Increase first-order profit, AOV and repeat purchases.
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