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Glossary · Metric

What is CAC Payback Period?

CAC payback period shows how many months it takes to earn back the money spent acquiring a customer. For cash flow it matters even more than the LTV:CAC ratio: the ratio can look fine, but if payback takes 18 months you will run short of cash as you grow.

Detail

In e-commerce the target is usually payback on the first order or within the first 3 months. Subscription models tolerate 6–12 months. For brands holding stock, a longer period means a bigger inventory financing need — which is how fast-growing brands with slow payback can look profitable and still go under.

Formula

Payback period = CAC ÷ Monthly gross profit per customer

Example

150 TL CAC, with the customer leaving 50 TL of gross profit a month → 3 months.
FAQ

Common questions on this topic.

How is CAC Payback Period calculated?

Payback period = CAC ÷ Monthly gross profit per customer

150 TL CAC, with the customer leaving 50 TL of gross profit a month → 3 months.

Why does CAC Payback Period matter?

In e-commerce the target is usually payback on the first order or within the first 3 months. Subscription models tolerate 6–12 months. For brands holding stock, a longer period means a bigger inventory financing need — which is how fast-growing brands with slow payback can look profitable and still go under.

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