LTV & CAC

LTV & CAC lives in the Business area of the dashboard, under Marketing ROI.

At a glance#

What it does#

LTV and CAC together: lifetime value per user, cost to acquire one, and the ratio between them — plus ARPU, paying profiles and installs, broken down by channel.

The LTV/CAC ratio is the single number that says whether acquisition is a growth engine or a leak. Below 1, every customer costs more than they return.

When to use it#

Before increasing any acquisition budget, and periodically regardless. It is the check that prevents the most expensive mistake available to a growing company: scaling a channel that loses money per customer, which looks like growth for as long as the funding lasts.

Workflow#

1. 1

   Read the ratio per channel, not overall

   A blended ratio hides that one channel is excellent and another is underwater. The blend is what lets a bad channel survive.

2. 2

   Check LTV maturity before trusting it

   LTV to date on a young population understates lifetime value, which makes a good channel look bad. Compare cohorts of similar age — Cohort revenue is the page for that.

3. 3

   Look at paying profiles against installs

   The conversion from install to paying is often the lever, not the price. Improving it lifts LTV across every channel at once.

4. 4

   Then look at payback, not just the ratio

   A healthy ratio with a long payback period is still a cash-flow problem. See Unit economics.

Permissions and prerequisites#

Requires revenue events, identified users, and ad-spend data for CAC. Without spend there is LTV and no ratio.

Limits and edge cases#

• CAC depends on attribution, which is approximate — see Cost & ROAS for why, particularly on mobile.

• Organic users have no CAC, so including them in a blended CAC flatters it.

• The ratio needs volume. Channels with a handful of paying users produce ratios that mean nothing.

• Revenue is client-reported with the usual caveats.

Troubleshooting#

LTV/CAC has no value. CAC is unavailable — no spend data, or no attribution linking users to a paid channel.

A channel's ratio is far better than the others. Check whether it is mostly organic traffic misattributed as paid, or a very small sample.

Where the data comes from#

Served by

• Business impact

• Growth scoring

Related#

• Unit economics

• Cost & ROAS

• Revenue attribution

• Budget pacing

• Business overview