You calculate your maximum customer acquisition cost from your margin: it equals the profit per customer after deducting all variable costs. From this number, you derive your max cost per order or lead, target PNO (ad cost share of revenue) and ROAS, and a sensible budget. Here we show one method for both e-shops and B2B services, with two model examples.

Start with a limit, not a budget

Don't guess your ad budget; start with your limit per customer. This number decides three things:

• how much to spend on ads so it pays back,
• which channel brings customers below your limit and which exceeds it,
• when to adjust or pause a campaign.

Don't confuse "what we spend" (accounting data) with "what we can afford" (profit limit). Without the second number, you can't tell whether ads generate profit or just unprofitable revenue.

Pull data from your accounting, e-shop admin, carrier and payment gateway invoices, and your CRM or lead sheet. Use a 12-month average so seasonality doesn't skew the result.

Margin, markup, and contribution margin

Base your math on profit, not revenue. Don't confuse margin (share of selling price) with markup (share of purchase price). If you buy goods for CZK 70 and sell them for CZK 100 excluding VAT, markup is 30 / 70 = 43%, while margin is only 30 / 100 = 30%. Using 43% overstates profit by over a third and makes you overpay for ads.

Next, subtract variable order costs from your margin: shipping not paid by the customer, gateway fees, packaging, marketplace commissions, and return or cancellation costs. What remains is contribution margin—it funds marketing, fixed costs, and profit. Calculate everything excluding VAT. For services, take the contract price excluding VAT and subtract materials, labor hours, and subcontractors.

Terms we use:

Distinguish CAC from CPA: CPA counts every order, including repeat buyers, and works for daily campaign management. CAC counts only new customers and includes all acquisition costs—use it for budget planning.

E-shops: max cost per order, PNO, and ROAS

Your maximum cost per order equals the contribution margin of an average order. Above this limit you lose money; below it you generate profit.

Model e-shop example (illustrative figures excluding VAT):

At break-even, ads earn nothing, so keep a buffer. To retain half the contribution margin as profit, an order can cost at most CZK 110 (target PNO 11%, target ROAS 909%—spending at most 11 haléřů on ads per koruna of revenue).

PNO shows ad spend as a share of revenue; ROAS shows how much revenue one koruna of ad spend brings. At 500% ROAS (CZK 5 in revenue per CZK 1 in ads), PNO is 20%; at 10% PNO, ROAS is 1,000%. Google uses the same formula in its Target ROAS guide (USD 5 in sales per USD 1 in ads = 500% ROAS).

In Google Ads, set Target ROAS (available for Search and Shopping campaigns from 15 conversions in 30 days); on comparison shopping sites, set target PNO. Make sure platforms track revenue excluding VAT. Monthly, compare campaigns against your limit: scale those below it, and adjust or pause those above it.

Services and B2B: what a lead can cost

In services and B2B, the key metric is maximum cost per lead: max cost per customer multiplied by close rate. Take a firm with an average contract of CZK 40,000 excluding VAT that closes one in four leads:

1. Average contract: new customer invoices over the past year average CZK 40,000.
2. Profit per contract: after materials, labor, and direct costs, 30% remains, or CZK 12,000 (use profit, not revenue).
3. Maximum cost per customer: the share of first-contract profit allocated to acquisition—one-third, or CZK 4,000.
4. Close rate: one in four leads becomes a contract, so 25%.
5. Maximum cost per lead: CZK 4,000 × 0.25 = CZK 1,000.

If better sales execution (fast replies, clear quotes, references) lifts conversions to one in three leads, your limit rises to about CZK 1,333. Count only genuine leads, not general messages (opening hours, supplier pitches) that distort close rates. If deals take weeks, measure close rates over six months rather than last month.

Returning customers: LTV and payback

With repeat purchases, the first order may lose money. Customer lifetime value (LTV) is the sum of contribution margins across all of a customer's purchases. Knowing it lets you pay more than competitors counting only the first order.

Model example (fictional figures): a cosmetics e-shop buyer orders three times in two years with a CZK 220 contribution margin (CZK 660 total). If acquiring her costs CZK 300, the first purchase loses CZK 80, but after the second the e-shop profits CZK 140.

The payback period shows when acquisition costs return. Here, on the second order—if she buys every eight months, you wait eight months. Yet you pay for ads upfront, so rapid growth risks paper profits and an empty bank account. Therefore:

• Use your own data, not estimates. Track cohorts (e.g., buyers first ordering in March one or two years ago) to see if ad-acquired customers return like others.
• Use a shorter window, like 12 or 24 months, not "lifetime" value.
• Watch how much cash you have tied up in new customers.

Hidden customer acquisition costs: VAT, management, and returns

True customer acquisition cost exceeds the spend in your ad account—tax, management, and returns are often left out.

Customer acquisition cost also includes:

• Campaign management: agency fees or specialist time (CZK 10,000 monthly across 100 ad orders adds CZK 100 per order).
• Tools and tracking: paid feed, analytics, or onboarding email tools for new buyers.
• Discounts and gifts: a 10% first-order discount cuts your margin.
• Returns and cancellations: a returned order cost ad spend but brought zero revenue.

Watch for the opposite error too: ad platforms sometimes claim purchases from loyal customers searching your brand name. We explain more in Conversion attribution: why ad numbers exaggerate.

What to do next: three scenarios

Compare your limit with actual campaign costs:

Below the limit: scale up. Ads are profitable. Raise the budget, add keywords, or add a channel—see Google Ads or Sklik?, and for e-shops, product comparison sites and marketplaces. Watch that costs don't pass your limit as spend grows.

At the limit: tune your site and offer. Ads barely break even. Make your site faster and clearer, lift conversion rates, raise order value (bundles, free shipping thresholds), and drive repeat sales via email. Lifting average orders from CZK 1,000 to CZK 1,100 at the same margin and costs raises contribution margin and your limit by CZK 30 to CZK 250. Setup tips: How to run a successful PPC campaign.

Above the limit: change channel, price, or product. Every order loses money. Advertise only highest-margin items, test another channel, or adjust prices; if that fails, cut the budget.

We cover overall budgets and brand building in Marketing budget. To calculate your limit and set up campaigns with us, explore our marketing campaigns or tell us what you sell.

Frequently asked questions