A CAC–LTV Calculator is a quick decision-making tool for marketing and sales leaders that shows whether their customer acquisition cost (CAC) is sustainable compared to their customer lifetime value (LTV).

Think of it as a profitability checkpoint — it tells you if what you spend to get a customer is justified by what that customer will bring you over their lifetime.

1️⃣ Key Terms

• CAC (Customer Acquisition Cost)
  How much do you spend (marketing + sales) to win one customer?
  Formula: CAC = Total Marketing & Sales Spend / Number of New Customers Acquired
• LTV (Customer Lifetime Value)
  The total revenue you expect from a single customer before they stop buying.
  Formula: LTV = Average Revenue per Customer × Retention Period
• ROI (Return on Investment) in this context
  How much profit (or loss) do you make per customer compared to the acquisition cost?
  Formula: ROI = ((LTV - CAC) / CAC) × 100%

2️⃣ Why It Matters

Marketing managers, CMOs, and CEOs use CAC–LTV ratios to answer:

• Are we paying too much to get customers?
• Do customers stick around long enough to cover acquisition costs?
• Should we spend more, spend less, or shift spend to higher-ROI channels?

A healthy LTV:CAC ratio is usually:

• 3:1 → Very good (each $1 in CAC brings $3 in revenue)
• 1:1 or below → Unsustainable (you break even or lose money)

3️⃣ Example

Imagine:

• Monthly ad spend = $5,000
• New customers acquired = 50
• Average revenue per customer per month = $200
• Average retention = 12 months

Step 1 — CAC:

$5,000 ÷ 50 = $100 CAC

Step 2 — LTV:

$200 × 12 = $2,400 LTV

Step 3 — ROI:

(($2,400 - $100) ÷ $100) × 100% = 2,300% ROI

✅ This tells the marketing manager they can afford to scale because the payback is strong.

4️⃣ Why It’s Perfect for a Homepage

• Instantly Relevant: Every marketing manager wants to know, “Is my spend paying off?”
• Interactive: Visitors put in their numbers, making them more engaged.
• Lead Capture Ready: You can show results and then offer a deeper, emailed breakdown.
• Positioning: Shows your brand is ROI-focused and data-driven from the first impression.