Log in with GoogleCustomer value and efficiency
Customer acquisition cost, LTV and marketing efficiency ratio: what a customer is worth and what you can pay for one.
Customer acquisition cost formula for ecommerce
Customer acquisition cost is ad spend divided by new customers. See the formula, a worked example, and the most you can pay for a first order.
LTV:CAC ratio for ecommerce: what a customer is worth
LTV:CAC only means something when LTV is profit, not revenue. See the formula, a worked example and how to derive your own target ratio instead of 3:1.
Marketing efficiency ratio vs ROAS, POAS, ROI and nCAC
Marketing efficiency ratio (MER) is total revenue ÷ total marketing spend. See how it differs from ROAS, POAS, ROI and nCAC, and which to steer by.
Predicted LTV (pLTV): what it is and when to bid on it
Predicted LTV (pLTV) estimates what a customer will be worth. See how it differs from observed LTV, three ways to estimate it and what to check before bidding.