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LTV/CAC index

LTV (Life Time Value) is an marketing index which shows an overall quantity of income from one client during all time of work with one.

CAC (Cost of Customer Acquisition) means how much money you spend to attract one customer.

The ratio of these two parameters is very important for business. It is used to count whether the investments into marketing and sales were profitable.

What can you do to improve this index?

1. Create or reconsider your buyer persona Who are your most valuable clients? What do they have in common? How did you attract them and how can you attract more people like them? And don't ever attract people who will never be satisfied with your product.

2. Think about client experience Is your on boarding and after-sales service good enough? What else can you do to make cooperation with you the most comfortable for a client?

3. Ask more! Ask your clients about their opinion about you and your service. Ask your employees, what selling techniques work better in their point of view. Ask more and know more!

4. Use cross-sale and up-sale To increase LTV, try to use cross-sales and up-sales.


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