The LTV to CAC ratio compares the lifetime value of a customer to the cost of acquiring them. It is used to assess the sustainability of growth.
Higher ratios generally indicate healthier economics.
Examples in Action
- Evaluating long-term acquisition viability
- Comparing channels or segments
- Informing growth strategy decisions
- Assessing profitability thresholds
Typical Outcomes / Results
- Improved financial sustainability
- Better prioritisation of acquisition efforts
- Clearer understanding of growth economics
- Stronger strategic alignment
This glossary entry reflects standard growth metric usage.