What a customer is worth over their life with you, and the most you can pay to acquire one.
How it's calculated
Margin here means gross margin after product cost, shipping and payment fees, before ad spend.
3:1 on gross profit. Below that, acquisition eats the margin the repeat orders were meant to bring. Well above it, you are probably under-spending on growth.
Gross profit. A customer worth $300 in revenue at a 40% margin is worth $120 to the business, and that is the number CAC has to fit under.
The second order. Post-purchase, replenishment and win-back flows decide most of lifetime orders, which is why email and SMS move LTV more than anything else.
20 minutes on your numbers. We tell you the target we would commit to, or that we would not.
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