What is a good customer acquisition cost?
Posted: Wed Jan 22, 2025 10:11 am
That’s why the LTV/CAC ratio is so important. This ratio compares the revenue a customer generates over the course of their relationship with you (customer lifetime value or LTV) to what you spent to acquire them (CAC).
Here's a widely accepted rule: **A solid LTV/CAC ratio is typically 3:1 for a SaaS company
Every dollar you spend on acquiring a customer should generate at least three dollars in lifetime revenue.
The cost of acquiring customers (CAC) in the industry varies widely by sector and features unique marketing channels, customer behaviors, and competitive landscapes. Let’s explore them below:
Average customer acquisition cost by industry sector
via FirstPageSage Below is a breakdown of average CAC by industry in the US for B2B companies, according to a report by FirstPageSage .
SaaS: $205-$450 is the average CAC. This sector has a higher CAC due to complex sales processes and vp risk email lists investment in marketing to build trust for long-term subscriptions.
Healthcare: This sector has an average CAC of between $600 and $1,200. The complexity of the purchasing processes and strict compliance with regulations increase procurement costs.
Manufacturing: The average CAC for this industry is $250-$500. Relatively lower CAC as direct sales and fewer middlemen typically drive relationships
Real estate companies: The average CAC for this sector is $400-$900. This is due to long sales cycles and high-value transactions, which require more personalized marketing.
Here's a widely accepted rule: **A solid LTV/CAC ratio is typically 3:1 for a SaaS company
Every dollar you spend on acquiring a customer should generate at least three dollars in lifetime revenue.
The cost of acquiring customers (CAC) in the industry varies widely by sector and features unique marketing channels, customer behaviors, and competitive landscapes. Let’s explore them below:
Average customer acquisition cost by industry sector
via FirstPageSage Below is a breakdown of average CAC by industry in the US for B2B companies, according to a report by FirstPageSage .
SaaS: $205-$450 is the average CAC. This sector has a higher CAC due to complex sales processes and vp risk email lists investment in marketing to build trust for long-term subscriptions.
Healthcare: This sector has an average CAC of between $600 and $1,200. The complexity of the purchasing processes and strict compliance with regulations increase procurement costs.
Manufacturing: The average CAC for this industry is $250-$500. Relatively lower CAC as direct sales and fewer middlemen typically drive relationships
Real estate companies: The average CAC for this sector is $400-$900. This is due to long sales cycles and high-value transactions, which require more personalized marketing.