🎯 Business Information
📈 Customer Lifetime Value Results
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Customer Lifetime Value
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Max Ad Spend per Customer
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How it works
Formulas
How the CLV Calculator Works
Goal: estimate the profit generated by an average customer over their full relationship (CLV), then infer a sustainable maximum customer acquisition cost (CAC).
Inputs: Industry (for context/benchmarks), Average Order Value (AOV), Gross Margin %, Repeat Purchases per Year, and Customer Lifespan (years).
Core Steps:
- Annual Revenue per Customer:
AOV × Purchases/Year - Annual Profit per Customer:
Annual Revenue × Gross Margin % - Customer Lifetime Value (CLV):
Annual Profit × Customer Lifespan - Max Sustainable CAC (guideline):
CLV × 25%(leaves room for overhead, fees, returns, etc.) - Payback Period:
Max CAC ÷ Annual Profit
You can change the CAC guideline (e.g., 20–30%) based on your risk tolerance, cash flow, and payback targets.
Disclaimer: Results are estimates for planning, not financial advice. If you exclude overhead, fees, refunds, or discounts from margin, actual CAC headroom will be lower. Validate against your own cohort data and attribution.