How to calculate CAC and LTV for ads — and when to scale
Clarify which campaigns deserve more budget by measuring customer acquisition cost and lifetime value correctly.
Tecrube team
Marketing automation
Split CAC by channel
Dividing total marketing spend by new customers is not enough. Calculate CAC separately for Google, Meta, LinkedIn and organic. Include agency fees, tools and creative production.
Do not mix paying customers with leads. Cheap leads that never close are expensive.
Keep LTV honest
Use average order value × purchase frequency × gross margin × average customer lifespan. For subscriptions, include churn.
Optimistic LTV fuels reckless bidding. Anchor on realised revenue for the first 90 days, then refresh LTV with cohorts.
Write a scaling rule
Practical rule: if LTV / CAC is at least 3 and payback stays within 3–6 months, increase budget. Below 2, fix creative, bid or audience before scaling.
In Tecrube you see channel CAC beside estimated LTV and get scale-or-pause recommendations when thresholds are crossed.