Subscription Scorecard Metric Deep Dive: Customer Lifetime Value and Customer Acquisition Cost

3/14/2016

 

In previous Subscription Scorecard articles, Waterstone established that in order to manage and predict future revenue growth and profitability, a company must have a detailed understanding of its relationship with its customers. At the heart of that understanding are two key metrics that often are—and should be—evaluated together: customer lifetime value (CLTV) and customer acquisition cost (CAC). In this paper, Manger Andrew Loulousis and Associate Aman Singh outline the purpose of these two metrics, highlight various ways each can be calculated, and provide examples of real world applications.

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