Mastering Subscription Metrics: Decoding CAC, LTV, and Profitability
Update: 2025-05-27
Description
Understanding the financial metrics behind your subscription business is crucial for sustainable growth. In this episode of Subscription Prescription, we delve into the core numbers that drive profitability:Â Customer Acquisition Cost (CAC) and Customer Lifetime Value (LTV).
We'll explore:
How to accurately calculate CAC and LTV
The significance of the LTV:CAC ratio and what it reveals about your business health
Common pitfalls in interpreting these metrics Strategies to optimize your customer acquisition and retention efforts
Whether you're a seasoned entrepreneur or just starting out, this episode will equip you with the insights needed to make informed financial decisions for your subscription model.
đź“© Subscribe to the newsletter for more in-depth discussions: https://newsletter.thesubscriptiondoc.com/subscribe
The LTV calculation sheet I mention in the show: https://docs.google.com/spreadsheets/d/1NH1yJgEHaLFjsNDZ1FWAkXm7YfOr82e-8rjth6QFekU/edit?usp=sharing
We'll explore:
How to accurately calculate CAC and LTV
The significance of the LTV:CAC ratio and what it reveals about your business health
Common pitfalls in interpreting these metrics Strategies to optimize your customer acquisition and retention efforts
Whether you're a seasoned entrepreneur or just starting out, this episode will equip you with the insights needed to make informed financial decisions for your subscription model.
đź“© Subscribe to the newsletter for more in-depth discussions: https://newsletter.thesubscriptiondoc.com/subscribe
The LTV calculation sheet I mention in the show: https://docs.google.com/spreadsheets/d/1NH1yJgEHaLFjsNDZ1FWAkXm7YfOr82e-8rjth6QFekU/edit?usp=sharing
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