Govur University Logo
--> --> --> -->
...

When analyzing customer churn, why is it necessary to compare the cost of customer acquisition to the customer lifetime value to determine a startup's viability?



Customer acquisition cost, or CAC, is the total amount of money a business spends on marketing and sales efforts to gain one new customer. Customer lifetime value, or LTV, is the total net profit a business expects to earn from a single customer over the entire duration of their relationship. Comparing these two metrics determines startup viability because it reveals whether the business model is financially sustainable. A startup is only viable if the LTV exceeds the ....

Log in to view the answer



Community Answers

Sign in to open profiles and full community answers.

No community answers yet. Be the first to submit one.

Redundant Elements