When churn occurs, not only does your marketing team have to dedicate time and resources to bringing in new leads and prospective customers, but also refocus on re-attracting customers lost.
For most of today’s businesses, majority of the value from a consumer is generated not during the initial purchase; but in course of the customer’s journey. The Consumer Lifetime Value (LTV) has to be higher than the Customer Acquisition Cost (CAC); in order to sustain a business.
The LTV/CAC ratio, therefore, is indeed the most powerful and versatile diagnostic tool. It not only provides a clear view of a product’s/ business’ financial health and value creation, but also guides decision making. It has changed the way many leading companies evaluate and develop their offerings, take them to market, and manage their portfolio.
Propellor provides an accurate read into your LTV/CAC Ratio.