Customer Acquisition Cost and Payback Period: How to Calculate CAC (Worked Example)

What does it really cost to win a new customer, and how long until they pay you back? This plain-English guide explains customer acquisition cost (CAC) the way Shopify defines it, why blended CAC beats ad-platform numbers, and how to work out the CAC payback period using gross profit, not revenue. A worked example with a sample window-cleaning business adds up every cost, from ads to the owner's time and first-clean discounts, then checks payback with customer drop-off and up-front cash. Includes Google Ads cost-per-lead benchmarks, vendor rules of thumb, four mistakes and a checklist. 0:00 Intro 0:48 Part 1: The basics 2:10 Part 2: How it works 3:41 Part 3: Worked example 6:31 Part 4: Mistakes 7:36 Do this week SOURCES (all diagrams and examples are our own, made from these): Shopify (vendor blog): Customer Acquisition Cost https://www.shopify.com/blog/customer... Polar Analytics (vendor blog): Customer Acquisition Cost (CAC): Formula, Benchmarks and How to Lower It on Shopify https://www.polaranalytics.com/post/c... ChartMogul (SaaS metrics vendor): CAC Payback https://chartmogul.com/saas-metrics/c... Orb (billing vendor blog): CAC payback: What it is and how to calculate it https://www.withorb.com/blog/cac-payback WordStream (LocaliQ): 2025 Google Ads Benchmarks https://www.wordstream.com/blog/2025-... US Small Business Administration (SBA.gov): How to Get the Most From Your Marketing Budget https://www.sba.gov/blog/how-get-most... Littledata: Shopify benchmarks https://www.littledata.io/benchmarks Shopify (vendor blog): How to Calculate Customer Lifetime Value https://www.shopify.com/blog/customer... Benchmarks change over time and differ by industry; the worked examples use a clearly labelled sample business. Platform menus and settings change, so check the official help pages linked above. This video is education, not legal or financial advice. Narration uses an AI voice. #CustomerAcquisitionCost #SmallBusiness #FunnelNotes