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Marketing ROI, CAC and LTV Calculator

Work out cost per lead, customer acquisition cost (CAC), lifetime value (LTV), LTV to CAC ratio, ROAS, ROI and how many months a new customer takes to pay back what you spent to win them. Change any number to see the effect straight away.

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About this tool

Most marketing reports stop at clicks, leads or ROAS. Those numbers can look healthy while the business still loses money on every new customer, because they ignore margin, other marketing costs and how often customers come back. This calculator joins them up in one place, using gross profit rather than revenue, so the answer reflects what the business actually keeps.

Enter what you spent on ads and on everything else that went into the campaign (agency or freelancer fees, tools, content), how many leads you got, how many became customers, the average order value, your gross margin, and how often and for how long a typical customer buys. The calculator shows cost per lead, CAC, LTV, the LTV to CAC ratio, ROAS, ROI on first orders and over the customer lifetime, and the CAC payback period.

The chart shows gross profit from one customer adding up with each order against the cost of winning them, so you can see when a customer starts to make money. The table underneath shows how lifetime ROI changes if your conversion rate or order value moves up or down by 15 to 30 percent, which is often the quickest way to see where improvement is worth most. All inputs are saved only in your browser.

How to use it

  1. Choose your currency.
  2. Enter ad spend and other marketing costs for the same period.
  3. Add leads, lead to customer rate, order value and gross margin.
  4. Set orders per customer per year and customer lifetime.
  5. Read the results, the payback chart and the what-if table, then download the CSV.

How it works

Cost per lead and CAC
Total marketing cost divided by leads, and by new customers.
LTV
Gross profit a customer brings over their lifetime.
LTV : CAC
How many times a customer's value covers the cost of winning them.
ROAS and ROI
First-order revenue against ad spend, and profit against total marketing cost.
Payback
Months until a customer's gross profit covers their acquisition cost.

Formula and assumptionsTotal cost = ad spend + other cost. Customers = leads × lead to customer rate. CPL = total cost ÷ leads. CAC = total cost ÷ customers. Gross profit per order = order value × margin. LTV = gross profit per order × orders per year × lifetime years. ROAS = customers × order value ÷ ad spend. ROI = (customers × gross profit − total cost) ÷ total cost, on first orders or over the lifetime. Payback = CAC ÷ monthly gross profit per customer (first order if one order covers CAC). No discounting or churn curve is applied.

FAQ

Questions about this tool.

01 What is a good LTV to CAC ratio?

Many teams use about 3 to 1 as a rule of thumb: a customer is worth three times what it cost to win them. Below 1 you lose money on each customer. Well above 5 can mean you are under-spending on growth. The right level depends on your cash position and how reliable your lifetime estimate is.

02 What is the difference between ROAS and ROI?

ROAS compares revenue with ad spend only. ROI compares profit with your total marketing cost. A campaign can have a ROAS of 3 and still lose money if margins are thin or other costs are high, which is why this calculator shows both.

03 Should I use revenue or gross profit for LTV?

Gross profit. Revenue makes every number look better than it is, because part of each sale goes to the cost of goods or delivery. This calculator uses your gross margin so CAC is compared with what you actually keep.

04 How do I estimate customer lifetime?

Use your own data where you have it: how many years an average customer keeps buying, or 1 divided by your yearly churn rate. If you are not sure, start with a cautious number such as one to two years and see how sensitive the result is.

05 Are my numbers stored anywhere?

Only in your own browser, so the form remembers them next time. Nothing is sent to our server.

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