Definition Compares the value of a customer with the cost of acquiring them. A higher ratio means more profitable growth.
Example A CLV of €600 and a CAC of €100 gives a ratio of 6:1.
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Why it matters It shows whether spending on growth is paying off.
Where it is used Growth dashboards and investor updates.
How to calculate it Customer lifetime value ÷ customer acquisition cost
Worked example A CLV of €600 and a CAC of €100 gives a ratio of 6:1.
