Is your acquisition sustainable?
Does a customer bring in enough compared to what it costs to acquire them? Calculate your LTV : CAC ratio and your payback period.
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Pre-fills the acquisition cost with the industry benchmark. US benchmarks, converted to Canadian dollars.
Goal: get past 3 to 1. A lower CAC slides your marker toward the healthy zone.
Indicative estimate, based on our median results and on market benchmarks (Google Ads, Gartner, 2025 studies). Your real numbers depend on your offer and your starting point. We refine them during an audit.
Customer lifetime value (LTV) and acquisition cost (CAC) are the two numbers that tell you whether your growth is healthy or is quietly draining you. The ratio between the two should aim for at least three to one. This calculator establishes it, and shows the effect of a reduced CAC on your profitability and your payback period.
What you should know
What is a good LTV : CAC ratio?
A 3 to 1 ratio is generally considered healthy: every dollar invested in acquisition returns three dollars of margin over the customer's lifetime. Below 1, you lose money on every acquisition; well above 5, you may be under-investing in growth.
How do you calculate customer lifetime value?
Multiply the average order value by your margin rate, by the annual purchase frequency, then by the average customer lifetime in years. We reason in margin, not revenue, to reflect the value actually generated.
How do you improve the ratio?
By lowering CAC (better-targeted acquisition, tracking, conversion) and raising LTV (retention, upsell, repeat purchase). Our growth leadership works both sides to make acquisition durably profitable.