Free Tool
CPA and CAC Calculator
Work out your cost per acquisition, your customer acquisition cost, and the most you can pay for a customer before the math stops working.
What you spent on ads over the period.
Conversions in the same period: leads, calls, or sales.
Your CPA
You spend $200 on ads for each conversion.
If your conversion is a lead, this is a cost per lead, and many leads never buy. Bid on what a customer is worth to you: .
CPA is ad spend divided by conversions. It uses ad spend only, and it counts whatever you define as a conversion.
What Each Tab Tells You
Each tab answers a different question. CPA asks what a conversion costs. CAC asks what a new customer costs once you count everything. Max affordable CPA asks what you can pay and still make money.
CPA: cost per conversion
Ad spend divided by conversions. Google Ads reports it as Cost / conv. It is only as useful as the conversion behind it. A cheap lead that never buys still costs money.
CAC: cost per new customer
Ad spend plus agency fees, tools, and sales cost, divided by new customers. It shows what growth costs the business, and it is usually higher than the CPA in your ad account.
Break-even CPA
Customer value multiplied by gross margin. For repeat buyers, multiply by expected purchases too. Pay more than this for a customer and you lose money on them.
Where Target CPA fits
Target CPA tells Google Ads the average cost per conversion you want. Set it from your break-even CPA minus your margin of safety. The ROAS target calculator does the same job for value-based bidding.
The target is only as good as the conversion under it. Our Target CPA guide explains what happens when a lead-gen account sets its target against form fills: the CPA looks fine, and the cost per signed client goes up, because the bidding never learns which leads bought. When you bid on value instead, our value-based bidding guide covers the setup, and the conversion value calculator sets a value for each funnel stage.
Formulas and Benchmarks
How do you calculate cost per acquisition?
Divide your ad spend by the number of conversions in the same period. $10,000 of spend and 50 conversions is a $200 CPA. Google Ads shows the same number in the Cost / conv. column. Google calculates it as total cost divided by the number in the Conversions column.
How do you calculate customer acquisition cost?
Add every cost you pay to win new customers, then divide by the number of new customers. That includes ad spend, and it can include agency fees, tools, and the cost of your sales team. $10,000 of ad spend plus $4,000 of other costs, divided by 20 new customers, is a $700 CAC.
What is the difference between CPA and CAC?
CPA counts the cost of one conversion, and a conversion can be a lead, a call, or a sale. It usually uses ad spend only. CAC counts the cost of one new paying customer, and it usually includes costs outside the ad account. When your conversion is a lead and some leads do not buy, CAC is higher than CPA.
What is a good cost per acquisition?
A good CPA is one below your break-even CPA, with room left for profit. Break-even CPA is the customer value multiplied by your gross margin. Industry averages do not know your prices or your margins, so use them as context only. The third tab of this calculator gives your break-even CPA and a target at the margin of safety you choose.
What is cost per acquisition in Google Ads, and how does it relate to Target CPA?
In Google Ads, CPA is the Cost / conv. metric. Target CPA is a bid strategy where you set the average amount you want to pay for a conversion. Some conversions cost more and some cost less, and Google Ads tries to keep the average at your target. The recommended target is your average CPA from the last 30 days, adjusted for conversion delays.
That number describes your past results. Your break-even CPA describes your economics. Google also notes that a target set too low can cost you conversions. Our Target CPA guide covers the settings in detail.
How do you reduce customer acquisition cost?
Start with what your bidding optimizes toward. Target CPA and Target ROAS only optimize for the conversion actions included in the Conversions column. If that column counts form fills, the bidding finds cheap form fills, whether or not those people buy. Import the qualified or closed outcome back against the click, so bidding learns which leads become customers. Our value-based bidding guide covers the next step.
Google Documentation Referenced
Platform claims on this page come from Google's documentation: Understand your conversion tracking data (how Cost / conv. is calculated) and About Target CPA bidding (how Target CPA and its recommended target work).
Next Step
Is Your Target Set Against Customers or Against Leads?
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