Marketing Acquisition (%) Calculator
Customer Acquisition (%) Calculator
1. Are you just starting out, or is your company more established?
Businesses in a launch phase often allocate more to acquisition to gain traction, while mature companies tend to optimize costs.
2. How would you describe your profit margins?
Higher profit margins often justify higher acquisition spending.
3. Do you face intense competition?
Highly competitive markets usually push acquisition costs up.
4. What's your growth strategy?
Aggressive growth often means higher acquisition spend, while profit-first strategies spend less.
Optional: Annual Revenue
Enter your revenue if you'd like to see what this recommended percentage means in dollars.
What are the signs that you’re investing too little in marketing?
If your business isn’t growing, you’re probably not spending enough. Marketing drives new customers, so if you’re not seeing steady growth, it’s a red flag.
If you rely only on word-of-mouth or repeat customers, you're missing out on fresh leads. Every business needs a constant flow of new clients to survive and scale.
When competitors are getting attention, and you’re invisible, that’s a clear sign you need to invest more. If people don’t know you exist, they won’t buy from you.
What are the signs that you’re investing too much or spending marketing money the wrong way?
If your marketing costs are eating up your profits, you’re spending too much. Marketing should fuel your business, not drain it.
If you’re getting leads but they’re not converting into sales, you’re targeting the wrong audience. A big ad budget won’t fix poor targeting.
When your marketing feels random—like you’re just throwing money at ads without a strategy—you need to step back and adjust. Every dollar should have a clear purpose and expected return.
If marketing is profitable, should you keep investing until it stops being profitable?
Yes, as long as every dollar you invest keeps making you more money, keep scaling. Marketing should be treated as an engine for growth, not just an expense.
The goal is to push as far as possible while keeping your returns positive. But don’t get reckless—watch your numbers closely. If your cost per customer starts rising too much, that’s your signal to slow down or optimize.
What types of businesses invest a huge percentage of their revenue in marketing?
Subscription-based businesses, online brands, and startups often spend aggressively on marketing—sometimes over 50% of their revenue. They need rapid growth to survive and dominate their markets.
E-commerce brands pour money into ads because visibility equals sales. Software companies, especially SaaS, invest heavily to acquire long-term customers who bring recurring revenue.
Personal brands, influencers, and digital course creators also spend big, knowing that attention is their main asset. Without marketing, they don’t exist.
Are there businesses that spend zero on marketing and still get customers?
Yes, but they’re rare. Most rely on location, exclusivity, or strong networks to attract clients naturally.
Businesses in high-demand areas—like a coffee shop in a busy train station—can get customers just by being there. Exclusive luxury brands often rely on reputation and word-of-mouth instead of ads.
Some personal consultants or coaches grow through referrals, never needing paid ads. But even they do some form of branding, PR, or networking—so in reality, almost no business truly spends zero on marketing.
How do I know my Target Cost of Customer Acquisition (CAC)?
To find your Target CAC, you need to know your Customer Lifetime Value (LTV). A common rule: your CAC should be no more than a third of your LTV. If you’re spending more, you’re cutting into your profits.
The formula is simple: LTV = Average Revenue Per Customer × Customer Lifetime. Then, CAC = Total Marketing Cost ÷ Number of New Customers. The goal is to keep your CAC low while keeping your LTV high.
Want to calculate your ideal CAC? Use our free tool here.