Cost Per Acquisition Calculator
CPA and marketing efficiency.
Calculate cost per acquisition and LTV:CPA ratio for marketing efficiency. Enter marketing spend and new customers to see cpa and ltv:cpa ratio.
What this tool does
This tool calculates CPA, LTV:CPA ratio, and payback period.
Enter Values
Formula Used
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Disclaimer
Results are estimates for educational purposes only. They do not constitute financial advice. Consult a qualified professional before making financial decisions.
Cost Per Acquisition (CPA) = marketing spend divided by customers acquired. Key metric for marketing ROI. LTV:CPA ratio >3 is healthy; <1 means unprofitable growth.
10,000 spend, 100 customers = 100 CPA. At 500 LTV that's 5:1 ratio (strong). Payback in 2.4 months at average 250/year revenue per customer. Poor ratios (<2:1) signal margin pressure or acquisition problems.
Use to guide marketing budget allocation. Channels with LTV:CPA above 5 can absorb more spend; channels below 3 need optimisation or defunding.
Quick example
With total marketing spend of 10,000 and new customers of 100 (plus customer ltv of 500), the result is 100.00. Change any figure and watch the output shift — it's often more useful to see the pattern than to memorise the formula.
Which inputs matter most
You enter Total Marketing Spend, New Customers, and Customer LTV. Frequency and unit price pull the total in different directions. The biggest surprise for most people is how small recurring amounts compound into large annual figures — that's where this calculation earns its keep.
What's happening under the hood
CPA = spend / customers. Ratio = LTV / CPA. Payback months = CPA / (LTV/12). The formula is listed in full below. If the number looks off, you can retrace the calculation by hand — that's the point of showing the working.
What to do with a low result
A disappointing result is information, not a judgement. Pick the single input that dragged the figure down most and focus the next quarter on that one factor. Breadth-first improvement rarely works; depth-first on the worst input usually does.
What this doesn't capture
The score is a composite of the inputs you provide. Life context — job security, family obligations, health, housing — doesn't appear in the math but shapes the real picture. Use the number as a prompt, not a verdict.
£10,000 £ / 100 customers = $100.00.
Inputs
This example uses typical values for illustration. Adjust the inputs above to match a specific situation and see how the result changes.
Sources & Methodology
Methodology
CPA = spend / customers. Ratio = LTV / CPA. Payback months = CPA / (LTV/12).
References
Frequently Asked Questions
What's a good LTV:CPA ratio?
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