Business Growth Calculators
Customer Acquisition Cost (CAC)
CAC is a great metric that allows you to see exactly how much you're spending to acquire a customer, however it doesn't mean a ton without comparing it to other metrics like CLV.
A lower CAC is better, as it suggests your marketing/sales are efficient and properly scaled.
Customer Acquisition Cost (CAC) =
(Sales Spend + Marketing Spend) ÷ New Customers Acquired
Note: You should include all the expenses related to sales and marketing in your CAC. This includes: Ad Spend, Salaries, Commission, Creative Costs, Software Costs, etc.Customer Lifetime Value (CLV)
CLV is the revenue an average customer will provide a company before they discontinue.
A higher CLV is better, as it indicates customers are valuable and loyal to your business.
Customer Lifetime Value (CLV) =
Average Annual Revenue Per Customer × Average Lifetime (Years)
Note: This is a simplified formula. You can also calculate CLV using monthly recurring revenue, gross margin, and churn rates for more accuracy.