CAC Payback — Customer Acquisition Cost Payback Period
Definition: The number of months it takes for a new customer's gross profit to cover the cost of acquiring them.
Example
If CAC is $1,200 and gross profit per customer per month is $100, payback is 12 months. Under 12 months is healthy for SaaS.
When you'll hear it
CAC Payback shows up most often in board meetings, quarterly business reviews, and strategy off-sites. When someone uses it, they're usually referring to customer acquisition cost payback period — and they expect the room to already know what that means.
FAQs
What does CAC Payback stand for?
CAC Payback stands for Customer Acquisition Cost Payback Period.
What does CAC Payback mean in business and finance?
The number of months it takes for a new customer's gross profit to cover the cost of acquiring them.
Where will I hear CAC Payback used at work?
CAC Payback comes up most often in board meetings, quarterly business reviews, and strategy off-sites. It's used as shorthand for customer acquisition cost payback period, so people assume you already know the term.