CAC vs MRR
CAC (Customer Acquisition Cost) and MRR (Monthly Recurring Revenue) both come up in business conversations and get confused. Here's the plain-English difference, side by side, so you can use each one with confidence.
The key difference: CAC refers to customer acquisition cost, while MRR refers to monthly recurring revenue — they describe different things even when they show up in the same sentence.
CAC — Customer Acquisition Cost
The total cost of acquiring a new customer, including marketing and sales expenses.
MRR — Monthly Recurring Revenue
The predictable revenue a business earns each month from subscriptions or contracts.
When to use CAC
Reach for "CAC" when the conversation is specifically about customer acquisition cost. The total cost of acquiring a new customer, including marketing and sales expenses.
When to use MRR
Reach for "MRR" when the conversation is specifically about monthly recurring revenue. The predictable revenue a business earns each month from subscriptions or contracts.
FAQs
What is the difference between CAC and MRR?
CAC stands for Customer Acquisition Cost — The total cost of acquiring a new customer, including marketing and sales expenses. MRR stands for Monthly Recurring Revenue — The predictable revenue a business earns each month from subscriptions or contracts.
Are CAC and MRR the same thing?
No. They're often used in the same conversation because they're related, but they describe different concepts. CAC = Customer Acquisition Cost. MRR = Monthly Recurring Revenue.
When should I use CAC vs MRR?
Use CAC when you're specifically referring to customer acquisition cost. Use MRR when the topic is monthly recurring revenue.