FREE TOOLCalculator
Calculate what each customer is really worth — and whether your acquisition costs make business sense.
Describe an average customer — what they spend, how often they buy, and how long they stay.
Every figure comes from your own five inputs — this tool uses no benchmark data beyond the 3:1 rule of thumb noted above. The formulas, exactly as computed:
Worked example (the tool’s defaults): ₹3,500 order value × 4 purchases/year × 3 years = ₹42,000 CLV; at 40% margin that’s ₹16,800 profit → against a ₹2,500 CAC the ratio is 6.7x, with a max safe CAC of ₹5,600 at the 3:1 target.
The gauge bands carry over from the original tool: 3x and above is healthy, 1–3x is acceptable but thin, and below 1x means each customer costs more to acquire than they ever return. A thin ratio is usually improved fastest on the retention side — lifting purchase frequency or lifespan compounds through the whole formula, while cutting CAC has a hard floor. If most of your value arrives in year two or three, make sure your cash flow can carry the acquisition cost that long before scaling spend. Once you know your ratio, cross-check it against the return your ads must clear with the Break-Even ROAS Calculator.
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