Top 8 Advertising Benchmarks for SaaS in 2025

In the competitive world of SaaS, it's easy to let your media spend run away from you, and that's where benchmarks come in. Benchmarks give clarity. They help CMOs, Growth Leads, and Founders understand whether their ad performance is strong compared to the market, and where budgets are being wasted.

Unlike e-commerce or fintech, SaaS advertising has unique dynamics:

• Longer sales cycles: ads often drive leads rather than instant sales.

• Complex buyer committees: multiple decision-makers and influencers.

• High CAC pressure: with investor focus on efficiency, SaaS firms are expected to grow with lower spend.

Benchmarks set a reference point, but they also surface gaps in efficiency. In 2025, as competition intensifies and channels saturate, having data-driven insights is critical for aligning budgets with realistic outcomes.

1. Average CPC (Cost-Per-Click)

Cost-per-click (CPC) sets the foundation for SaaS advertising economics. It’s the first indicator of how much you’ll pay to bring a potential customer into your funnel and in 2025, it’s more expensive than ever.

• Google Ads Search: B2B SaaS keywords average around £3 - £6 per click. However, for highly targeted campaigns or competitive enterprise keywords can exceed £15 per click.

• Facebook Ads: Lower, at £0.66 per click.

• LinkedIn Ads: Can be expensive given this is not high-intent search clicks, averaging £4.04 per click.

• Microsoft Ads (Bing): generally Microsoft Ads run about 40% less than Google Ads and is often under-utilised but valuable for B2B SaaS.

Why CPC matters in SaaS

CPC is often misunderstood as a “cost to minimise.” In SaaS, it’s more useful to see CPC as the price of access to a qualified audience. This is why SaaS marketers benchmark CPC not in isolation, but in relation to:

• Conversion rates (CVR): How well do those clicks turn into leads?

• Lead quality: Are they ICP-fit or outside your buying committee?

• Customer Lifetime Value (CLV): Could one click eventually represent thousands in ARR?

Rising CPCs: every click must count

Over the past five years, SaaS CPCs have steadily risen across platforms. Increased competition, more sophisticated targeting, and saturation in B2B categories have all driven costs higher year-on-year. That means:

• Budget dilution is real: unqualified clicks now waste more money than ever.

• Ad creative and targeting precision matter: every wasted click is more costly than it was three years ago.

• Higher CPCs force efficiency: you need to align ad spend with segments that can generate long-term ARR, not just short-term leads.

Making CPC work harder

To ensure you’re not just paying for traffic but paying for progress towards revenue:• Prioritise channels where your ICP is active, even if CPCs are higher.• Run negative keyword lists and audience exclusions to prevent wasted clicks.• Use CRM-linked attribution to track which CPC sources actually deliver closed revenue, not just leads.

Ultimately, CPC isn’t about chasing the cheapest clicks. It’s about investing wisely in the right clicks — the ones that represent real pipeline opportunities. And with costs climbing, SaaS companies need to make every single one of those clicks count.

2. Click-Through Rates (CTR) & Engagement

Click-through rate (CTR) is one of the clearest indicators of whether your ads are actually resonating with your target audience. It’s not just about getting impressions; it’s about proving that the message, offer, and targeting are aligned well enough to earn the click.

• Google Search (SaaS): ~4.28% CTR on average

• B2B SaaS Search CTR Median: closer to 8%

• Facebook Ads: ~1.43% CTR

• LinkedIn Ads: just 0.62% CTR, the lowest benchmark across platforms

Why CTR matters in SaaS

CTR reflects more than creative quality; it shows whether you’re reaching the right person at the right moment.

• A high CTR suggests your ad copy, headline, and offer are compelling, and your targeting aligns with the audience’s intent.

• A low CTR can point to mismatched keywords, irrelevant creative, or fatigue in your audience.

For SaaS, CTR is particularly important because clicks often represent the start of a longer customer journey. If you can’t win attention at the top of the funnel, you won’t have the opportunity to nurture buyers through demos, trials, or onboarding.

Channel nuances

• Search ads tend to show higher CTRs because they capture active intent, i.e. the user is already searching for a solution.

• Social ads often show lower CTRs because they’re interruptive in nature, but those clicks can be more valuable for demand generation rather than just lead generation.

• LinkedIn CTRs look poor on paper, but the audience quality (decision-makers, ICP-fit roles) means conversion rates after the click, with a strong enough multi-channel strategy, can still be strong.

How to make every click count

• Match ad to intent: Ensure keywords, ad copy, and landing page messaging line up seamlessly. Misalignment kills CTR.

• Test aggressively: Rotate headlines, creatives, and CTAs regularly. SaaS buyers are discerning and tune out repetitive messaging.

• Optimise formats: On social, experiment with carousels, video, and interactive content. SaaS buyers often need more context before clicking.

• Focus on relevance, not reach: A smaller, high-CTR audience that aligns with your ICP is more valuable than mass reach with a 0.5% CTR.

CTR isn’t just about vanity metrics. In SaaS, it’s a signal of market fit and message clarity. Strong CTRs give you more qualified users entering the funnel, and with rising ad costs, that level of efficiency is what separates sustainable growth from wasted spend.

3. Cost Per Lead (CPL)

Cost per lead (CPL) is a core SaaS benchmark because, unlike e-commerce or retail, leads don’t convert with a single click. In SaaS, advertising is usually driving form fills, demo requests, or trial sign-ups, and every one of those leads represents an investment you’ll carry until (or if) they become a paying customer.

• Average SaaS CPL: around £310 for paid channels. (source First Page Sage)

• Benchmarks vary dramatically by channel and offer: a simple newsletter opt-in may cost far less, while a qualified enterprise demo request could cost well above the average.

Why CPL matters in SaaS

CPL provides a direct link between ad spend and pipeline creation. It tells you how much you’re paying to bring someone into the funnel, but not all leads are created equal.

• A £300 CPL may sound high, but if those leads are from ICP-fit accounts with six-figure ARR potential, it’s good value.

• A £50 CPL could look efficient on the surface, but if those leads are from students, freelancers, or small businesses outside your target market, they’ll rarely convert to revenue.

That’s why SaaS teams should look at CPL alongside:

• Lead quality scores (MQL → SQL conversion rate)

• Pipeline velocity (how quickly leads move through the funnel)

• Downstream CAC (what that CPL becomes once sales costs are included)

Why CPLs have been rising

Similar to cost-per-clicks, over the past few years, CPLs in SaaS have also climbed steadily. Reasons include:

• Increased competition: more SaaS firms chasing the same ICPs across Google, LinkedIn, and Meta.

• Data privacy and targeting changes: reduced tracking precision means wasted impressions that don’t convert.

• Audience fatigue: decision-makers are inundated with SaaS ads, making them less likely to convert without highly relevant, differentiated offers.

As with CPC, this rise means every lead captured must be worth the cost. SaaS marketers can no longer afford to run generic gated content campaigns that flood sales with low-quality names.

How to improve CPL efficiency

1. Tighten targeting: Use exclusion filters and refined ICP lists to avoid paying for irrelevant leads.
2. Qualify with the offer: Position higher-friction offers (like a demo) to deter unqualified clicks, while using lighter offers (ROI calculators, benchmarks, toolkits) to engage top-funnel audiences.
3. Integrate CRM attribution: Don’t just count leads, track which ones actually close. Optimise budgets towards sources with the lowest effective CPL (cost per qualified lead).
4. Nurture properly: A lead with a high CPL can still deliver exceptional ROI if nurtured well through multi-touch campaigns.

In SaaS, CPL is less about chasing the lowest cost and more about balancing lead volume with lead quality. A benchmark of £310 tells you where the market sits but the real measure of success is whether those leads progress into revenue.

4. Conversion Rates (CVR)

If CPC and CPL tell you the “price of entry” into the funnel, conversion rates reveal whether that investment is turning into a qualified pipeline. This is where advertising either proves its worth or exposes inefficiency. But of course when we talk about conversion rate, it's important to understand exactly what you are offering and what you consider to be the conversion metric most important to you. For example:

• Average SaaS CVR for search ads: ~1.65% from ad click to enquiry-based lead.

• Average SaaS CVR for search ads: ~9.24% from ad click to free trial.

‍(Source: Nuoptima)

Why CVR matters in SaaS

Conversion rate benchmarks show how effectively your campaigns are transforming interest into action. But for SaaS, the meaning of “conversion” depends on the funnel stage:

• Top of funnel (TOFU): downloading a guide or calculator has high CVR, but low immediate value.

• Mid-funnel (MOFU): trial sign-up or webinar registration, more friction, lower CVR, but higher quality.

• Bottom of funnel (BOFU): demo request or pricing enquiry, lowest CVR, but most valuable for pipeline creation.

A strong SaaS marketing programme balances all three. You want high CVRs at TOFU for audience building, but also solid performance at BOFU to prove pipeline contribution.

Why CPA matters when looking at CVR

Cost per acquisition (CPA) translates clicks and conversions into the true cost of winning a new customer. It’s a more realistic view of performance than CPL, because it factors in sales involvement, lead qualification, and close rates.

• A £100 CPA could be excellent if your product’s ACV (annual contract value) is £10,000+.

• A £100 CPA might be unsustainable if your ACV is £500 and churn is high.

That’s why CPA must always be evaluated relative to Customer Lifetime Value (CLV) and CAC payback period so you won't find any benchmarks here.

Rising CPA pressure

As CPCs and CPLs have increased over the last few years, CPAs have naturally followed suit. This is particularly evident in crowded SaaS categories (e.g., HR software, project management tools, CRM platforms) where auctions are saturated and competition is fierce.

The challenge is no longer “can we generate conversions?” It’s “can we do it profitably within acceptable payback periods?”

How to improve CVR & CPA efficiency

1. Optimise landing pages: Simple, fast, and trust-building testimonials, logos, and clear CTAs reduce friction.‍
2. Qualify upfront: Use forms and CTAs to filter out poor fits. It’s better to convert fewer high-quality leads than many unqualified ones.‍
3. Retarget intelligently: Warm leads often need multiple touches. Retargeting lowers CPA by re-engaging visitors already familiar with your brand.
4. Align sales & marketing: A tight feedback loop ensures ad-generated leads are properly nurtured, not left to decay.
5. Test offer types: For example, shifting from a generic “Book a Demo” to an “ROI Assessment” or “Free Benchmarking Report” can lift CVRs while keeping lead quality high.

The bigger picture

In SaaS, conversion is a journey, not a single metric. Benchmarks provide a useful comparison, but the true test is whether your CPAs allow you to hit growth targets sustainably. If payback periods stretch too long or CAC edges too close to CLV, even “good” conversion benchmarks won’t protect profitability.

‍5. ROI from Paid Ads

Return on investment (ROI) is the ultimate measure of whether your advertising spend is actually working. It moves the conversation from “how many clicks or leads did we get?” to “did this channel generate meaningful revenue relative to cost?”

• Average SaaS paid ads ROI: ~199% (just under a 2x return) (source: Promodo)

‍• Stronger SaaS benchmarks: closer to 300% ROI (especially when retention and upsell opportunities are strong).

Why ROI benchmarks matter in SaaS

Unlike e-commerce, where ROI can be measured almost instantly at checkout, SaaS ROI plays out over a much longer period:

• Recurring revenue model: A single conversion today may not return its full value until months (or even years) into a subscription.

• Expansion potential: SaaS customers often start small and grow usage, meaning ROI compounds over time.

• Churn risk: If retention is weak, even ads with great initial ROI can underperform in the long run.

This is why SaaS ROI benchmarks can look modest compared to consumer industries, but the compounding nature of subscriptions and upsells means even a 2x ROI today may grow into much higher returns later.

Board-level significance

ROI is also the benchmark most frequently scrutinised by boards and investors:

• It provides clarity when reporting on marketing efficiency.

• It connects marketing spend to ARR growth and CAC payback periods, which investors use to assess scalability.

• It supports decisions on whether to scale, hold, or cut spend in certain channels.

A campaign with a 150% ROI may look “good” in isolation, but if it stretches CAC payback to 18 months, boards may push back. Conversely, a 200% ROI with rapid payback can justify aggressive scaling.

Why ROI is tightening in 2025

As CPCs and CPLs have risen, maintaining high ROI has become harder:

• Auction saturation drives up acquisition costs.

• Privacy and attribution changes make it more difficult to track downstream revenue accurately.

• Buyer fatigue (especially in crowded SaaS categories) reduces conversion efficiency, dragging down ROI.

Improving ROI in SaaS ads

1. Focus on retention & expansion: ROI isn’t just about the first deal; lifetime value from renewals and upsells is where real efficiency is unlocked.
2. Track revenue, not just leads: CRM attribution ensures you’re benchmarking ROI on closed ARR, not just pipeline.
3. Test channels beyond the obvious: Diversifying into Microsoft Ads, niche industry platforms, or partner co-marketing can deliver stronger ROI than oversaturated Google/LinkedIn
4. Prioritise payback period: Faster ROI (within 12 months) strengthens cash flow and investor confidence.
5. Refine messaging: Ads that clearly communicate ROI or problem-solution fit resonate more with SaaS buyers, lifting efficiency.

‍The bigger picture

ROI benchmarks in SaaS aren’t about chasing vanity multipliers. They’re about understanding whether advertising is fuelling profitable, sustainable ARR growth. A 2–3x ROI is strong in this space but only if it’s supported by healthy retention, a manageable payback period, and a scalable pipeline model.

6. CAC Payback

For SaaS businesses, CAC Payback is one of the most closely watched metrics by finance teams, boards, and investors.

Why CAC payback is critical

CAC payback tells you how long it takes to recoup acquisition costs through subscription revenue.

• A 6–12 month payback is typically considered strong for SaaS.

• Beyond 18 months, cash flow becomes strained meaning you’re funding growth with capital rather than revenue.

• The benchmark ~12 months average highlights the industry’s growing challenge: it’s taking longer to earn back what’s being spent to acquire paying customers.

Boards and investors scrutinise this metric because it ties directly to cash efficiency. If your payback period is too long, even strong revenue growth may not be sustainable without external funding.

7. LTV:CAC Ratio

If CAC and payback tell you how much you’re spending to acquire a customer, the LTV:CAC ratio tells you whether that spend is justified in the long run. It’s the benchmark most investors look at first when assessing SaaS business health, because it shows the balance between customer value and acquisition cost.

• A healthy LTV:CAC ratio in SaaS typically falls between 3:1 and 5:1 .

• Ratios below 3:1 signal that customer value isn’t high enough relative to what you’re spending to acquire them.

• Ratios above 5:1 may sound positive, but they can actually indicate under-investment in growth (i.e. you’re leaving potential market share untapped).

Why the ratio matters in SaaS

The LTV:CAC ratio goes beyond short-term ROI to assess sustainable growth potential:

• If LTV:CAC is strong (e.g. 4:1): every £1 you spend on acquisition is returning £4 in lifetime revenue. This suggests your marketing machine is efficient and can be scaled.

• If LTV:CAC is weak (e.g. 2:1): you’re spending heavily on acquisition but not retaining or expanding customers long enough to justify the cost.

For SaaS, this ratio is critical because most companies rely on recurring revenue. Losing customers early or failing to expand them will collapse the ratio, even if CAC benchmarks look good on paper.

Why it’s tightening in 2025

Several macro trends have put pressure on LTV:CAC ratios across SaaS:

• Rising CACs: Higher CPCs, CPLs, and CPAs inflate acquisition costs.

‍• Retention challenges: Benchmarks show gross revenue retention (GRR) decreasing.

‍• Greater competition: Buyers have more SaaS options than ever, making churn more likely.

‍• Economic scrutiny: CFOs and boards are prioritising efficiency, making poor LTV:CAC ratios more visible and less acceptable.

How to improve LTV:CAC

1. Reduce churn: Strengthen onboarding, customer success, and support to increase average lifetime value.
2. Drive expansion revenue: Upsells, cross-sells, and tier upgrades expand LTV without additional acquisition spend.
3. Target high-value ICPs: It’s better to win fewer, higher-value accounts than chase cheap leads that won’t last
4. Shorten payback: Faster recovery of CAC keeps the ratio healthier and cash flow stronger.
5. Align sales & marketing: Misaligned teams inflate CAC and hurt conversion efficiency, weakening the ratio.

‍The bigger picture

The LTV:CAC ratio is often described as the heartbeat of SaaS growth. It doesn’t just show how efficient your marketing is, it reflects the overall health of your go-to-market strategy, product stickiness, and retention strategy.

A 3–5x ratio remains the benchmark to aim for in 2025. Below that, you’re leaking too much value. Above it, you might be too conservative in your ad investment. The goal is not just to maintain the ratio but to use it as a decision-making compass for scaling spend, improving retention, and balancing efficiency with growth.

8. Retention & Expansion Metrics (NRR)

Retention and expansion metrics reveal whether you’re keeping and growing them. In SaaS, these are arguably the most important benchmarks of all, because even the best acquisition machine is useless if customers churn quickly.

• Net Revenue Retention (NRR): ~103% - 105% indicating most SaaS firms are holding steady, with expansion revenue just offsetting churn. (source: Metric HQ)

Why NRR matters in SaaS

NRR shows the combined effect of churn plus expansion revenue. If NRR is >100%, it means your existing customers are growing with you, which is the healthiest signal of all.

For SaaS businesses, investors and boards often see NRR as a stronger predictor of long-term success than any other metric. A company with 130% NRR can grow healthily even with slower acquisition.

The link to advertising benchmarks

Advertising ROI, CAC payback, and LTV:CAC ratios are all influenced by retention and expansion:

• High churn shortens customer lifetimes, pulling down LTV and weakening the LTV:CAC ratio.

• Strong expansion boosts ROI, because the revenue per acquired customer grows far beyond the initial deal.

• Payback periods shrink when existing customers expand quickly, because the acquisition cost is recovered faster.

Put simply: good retention makes your acquisition spend more efficient; poor retention makes even cheap clicks a waste.

The bigger picture

In SaaS, retention is the ultimate multiplier of advertising efficiency. High NRR and GRR make every click, lead, and customer acquisition more valuable over time. Weak retention, on the other hand, can collapse ROI benchmarks turning even the most efficient paid campaigns into a net loss.

SaaS companies with NRR above 120% (common among best-in-class enterprise SaaS) are often able to scale faster and more profitably than peers, even if their CACs are higher. That’s why in 2025, retention and expansion metrics aren’t just benchmarks, they’re the foundation of sustainable SaaS growth.

Emerging SaaS Advertising Trends in 2025

1. AI-driven targeting and creative testing: more SaaS firms are using AI to run micro-tests on copy, creative, and bidding strategies.
2. Content-driven lead ads: instead of just demo CTAs, SaaS advertisers are promoting calculators, ROI tools, and interactive benchmarks.
3. LinkedIn & Google Search cost pressure: despite high CPC and low CTR, these channels remain a benchmark for enterprise SaaS leads because of lead quality
4. Privacy changes: SaaS firms are increasingly using server-side tracking and CRM integration to benchmark ROI properly.

Practical Tips for SaaS Marketers

• Don’t chase cheap clicks: prioritise platforms where your ICP actually converts.

• Use benchmarks as directional, not absolute: compare within your niche (e.g., DevOps SaaS vs HR SaaS).

• Track CAC payback relentlessly: it’s the true indicator of sustainable ad spend.

• Double down on retention: pair acquisition benchmarks with NRR/GRR.

• Experiment across channels: Microsoft Ads and niche communities are often under-invested in compared to Google/LinkedIn.

Benchmarks aren’t just numbers. They’re a framework for smarter strategy, tighter budget allocation, and better board conversations.

By knowing the benchmarks that matter CPC, CTR, CPL, CAC payback, LTV:CAC SaaS marketers in 2025 can make informed, data-driven advertising decisions that fuel growth sustainably.

👉 For SaaS companies looking to benchmark their advertising performance and improve efficiency, our team at Lever specialises in SaaS digital marketing and paid acquisition strategies. Get your free proposal today.‍

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