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CAC vs Funnel Conversion Rates

What is the difference between CAC and Funnel Conversion Rates? Side-by-side definitions, formulas, and benchmarks for two of the most-watched SaaS metrics.

Definitions

What is CAC?

CAC is customer acquisition cost, the sales and marketing investment required to acquire customers.

Full CAC definition →

What is Funnel Conversion Rates?

Funnel Conversion Rates measure how prospects move from one stage of the marketing and sales funnel to the next.

Full Funnel Conversion Rates definition →

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CAC vs Funnel Conversion Rates at a Glance

CAC Funnel Conversion Rates
Category Metrics Formulas
Formula Overall CAC = S&M Spend / New Customers
Benchmarks target: 20–30%; target: 10–20%; target: 5–10%; target: 1–2%
Calculator CAC calculator

When Each Matters

CAC and Funnel Conversion Rates answer different questions. CAC is customer acquisition cost, the sales and marketing investment required to acquire customers. Funnel Conversion Rates measure how prospects move from one stage of the marketing and sales funnel to the next. In practice, healthy SaaS operators watch both, because each one catches failure modes the other misses.

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