CAC < 25% of LTV

Source

What's the Right Customer Acquisition Cost for Your Business?

I've written before about managerial ratios like the spend on employee development. One of the metrics that has come into vogue in recent years is something called customer acquisition cost (CAC), which is the ratio of dollars you spend to acquire a new customer to the revenue from that customer.

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What's the Right Customer Acquisition Cost for Your Business?

"when it comes to assessing how much you're spending on acquiring new customers, keep the 25 percent of lifetime margin as a customer acquisition cost rule in mind. If you can do that, the sky's the limit in terms of your future growth."