Marketing · Tool
ROAS / CAC / LTV Calculator
Calculate return on ad spend, CAC, and lifetime value.
ROAS inputs
CAC & LTV inputs
What is ROAS / CAC / LTV Calculator
Return on ad spend, customer acquisition cost, and lifetime value are the three numbers that decide whether a paid channel is worth scaling. Enter your spend, revenue, customers, and retention inputs to see all three with formulas shown — so the math is never a black box.
The ROAS / CAC / LTV Calculator computes the three most important paid-media unit-economics metrics from a small set of inputs: spend, revenue, customers acquired, average order value, and retention months. It shows each formula alongside the result so the math is auditable.
ROAS (return on ad spend) measures revenue per dollar spent. CAC (customer acquisition cost) measures spend per new customer. LTV (lifetime value) estimates how much a customer is worth over their relationship with you. The LTV:CAC ratio combines the last two into a single health metric.
It's built for founders and operators evaluating channel performance, growth marketers preparing for budget discussions, and finance partners stress-testing a paid plan before approving spend.
How to use ROAS / CAC / LTV Calculator
- 1Enter total ad spend and the revenue attributed to it.
- 2Enter new customers acquired to compute CAC.
- 3Optionally add AOV, retention months, and gross margin to compute LTV.
- 4Review ROAS, CAC, LTV, and the LTV:CAC ratio.
Why ROAS / CAC / LTV Calculator matters
Paid acquisition is one of the few business decisions where you can change the answer with a daily budget knob. That makes the unit economics behind the spend critical: you'll either scale a channel into profit or scale it into a loss faster than you can react. ROAS without margin context, CAC without LTV context, and LTV without payback context all lie in characteristic ways.
Strong paid-media decisions look at all three numbers together. ROAS tells you the immediate return; CAC tells you what each customer cost to acquire; LTV tells you whether that cost is justified. Calculating them in one place keeps the relationships honest and prevents the common failure of citing a channel-level ROAS to justify a spend level that the blended business economics don't actually support.
ROAS / CAC / LTV Calculator use cases
Monthly paid-media performance review
Pull spend and revenue from each channel for the month and run them through the calculator. The output gives you a one-page view of channel ROAS, CAC, and (if you have retention data) LTV:CAC for the team review.
Stress-testing a proposed budget increase
Before raising paid budget by 50%, model what CAC and ROAS would need to hold at to keep the channel above break-even. The calculator makes the relationship explicit so the budget conversation is grounded in math, not vibes.
Comparing channels with different cost structures
A 4× ROAS in paid search is not the same as a 4× ROAS in influencer marketing because the cost-to-serve and LTV profiles differ. Calculating CAC and LTV alongside ROAS clarifies which channel is actually contributing more to the business.
Preparing for a board or investor update
Investors want to see CAC, LTV, and the ratio between them. Run your numbers here and walk into the meeting with the formula visible, the inputs documented, and a defensible answer to the obvious follow-up questions.
Example
$10,000 spend driving $35,000 revenue with 250 new customers, $80 AOV, 6 months retention, and 60% margin gives ROAS 3.5, CAC $40, LTV $288, LTV:CAC 7.2.
FAQ
- What is a healthy LTV:CAC ratio?
- A common benchmark is 3:1 or higher. Below that, you are spending too much to acquire each customer relative to what they are worth.
- Should I include gross margin in LTV?
- For most subscription or e-commerce businesses, yes. LTV without margin overstates how much each customer actually contributes to the bottom line.
- Why does ROAS look fine when LTV:CAC looks bad?
- ROAS is a single-purchase metric — it can be strong even when retention is poor. LTV:CAC catches the difference because it accounts for repeat revenue.