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CAC:LTV Ratio

The ratio of the cost of acquiring a customer to the lifetime value of a customer.

If Acme's CAC is $100 and LTV is $300: CAC:LTV Ratio = $100 / $300 = 0.33. Acme aims for a lower ratio for better ROI.

Divide the Customer Acquisition Cost (CAC) by the Customer Lifetime Value (LTV).

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