Customer Acquisition Cost and Lifetime Value
Every business needs to know how much it costs to acquire new customers and how much profit those customers will generate. In this course we show you how to measure these metrics so that you can make more optimal decisions about how you spend your sales and marketing budget and how you monetize your customers.
Curriculum
01 Introduction
Get an overview of customer acquisition cost (CAC) and lifetime value (LTV) and how they can work together to inform business decisions.
02 Customer Acquisition Cost
Learn the formula to calculate your CAC and how to identify trends over time or by marketing channel.
03 Customer Lifetime Value
Learn the formula to calculate how much money you can expect to make from your customers over time and how the calculation is different based on your revenue model.
04 LTV Demonstrated
Time to practice! Reinforce your knowledge of lifetime value through the example of a lemonade stand.
05 The LTV-CAC Ratio
Put lifetime value and customer acquisition cost together to understand your core business economics and whether you are on a path to sustainable growth.
Meet Your Instructor
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Nic Barnhart
Cofounder & CPO, Pareto Labs
Finance/Analytics, ZipRecruiterNic Barnhart is a cofounder and Chief Product Officer at Pareto Labs. Prior to that he was in finance and analytics at ZipRecruiter and head of operations at a health tech startup acquired by Aetna. Earlier in his career, Nic started a business to teach kids basic finance concepts and founded a nonprofit organization to fund efforts to combat human trafficking. He earned a B.S. from the United States Air Force Academy and an MBA from The Wharton School at the University of Pennsylvania.