LTV:CAC (Lifetime Value to Customer Acquisition Cost Ratio)
Definition
A metric that compares the revenue a customer brings over their lifetime (LTV) to the cost of acquiring that customer (CAC). It helps determine whether the long-term value of a customer justifies the expense of acquiring them.
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Translation
The number that tells you if all the money you’re spending to get customers is actually worth it—or if you’re just throwing cash down a well and hoping for the best.