Unit economics

Are you paying too much for customers?

Punch in your spend, your new customers and your lifetime value. Zyro shows your customer acquisition cost and LTV:CAC ratio instantly. In plain English, in dollars.

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Include ad spend, agency fees and software costs.

Total paying customers gained in the same period.

How much a customer spends with you over their whole life.

The basics

What CAC is, and why it decides everything

Every dollar you spend to win a customer has to come back, and then some. Get this number wrong and growth quietly loses you money. Get it right and you know exactly how hard you can push.

What is CAC?

Customer Acquisition Cost (CAC) is the total cost of the sales and marketing effort needed to win one new customer. It is one of the clearest signals of whether your business model actually works.

Formula: Total marketing spend ÷ new customers acquired = CAC.

What is a good LTV:CAC ratio?

The LTV:CAC ratio compares what a customer is worth to what they cost to acquire. The figures below are common rules of thumb, not guarantees, your real numbers depend on margins and overheads:

  • Around 1:1 usually means you are losing money once other costs are counted in.
  • About 3:1 is the level most people treat as healthy: you make roughly three times what you spend to acquire a customer.
  • 5:1 or higher can be a sign you are under-investing and could afford to grow faster.

How do you lower your CAC?

The fastest lever is rarely cheaper ads, it is a better conversion rate. If you turn more of the same traffic into customers, your cost per customer falls without spending an extra dollar. Double your conversion rate and you effectively halve your CAC on the same ad budget.

That is exactly what Zyro is built to do: A/B test your pages to find what sells, show the right on-site offer at the right moment, and trace every sale back to the ad that earned it, so you spend where the buyers actually are.

Fair questions

The things you're right to ask

What is CAC?

Customer Acquisition Cost (CAC) is the total cost of the sales and marketing effort needed to win one new customer. You calculate it by dividing your total marketing spend by the number of new customers acquired in the same period.

What is a good LTV:CAC ratio?

A 3:1 ratio is the figure most people treat as healthy. Around 1:1 usually means you are losing money once other costs are counted, while a very high ratio such as 5:1 can mean you are under-investing and could grow faster. Treat these as rules of thumb, not hard rules.

How do I lower my CAC?

The fastest lever is usually your conversion rate, not cheaper ads. If you convert more of the same traffic into customers, your cost per customer falls without spending an extra dollar. That is what Zyro's A/B testing and on-site offers are built to improve.

Stop overpaying for customers.

Knowing your CAC is step one. Lowering it is the work. Put one snippet on your store and let Zyro test, catch leavers, and follow your money. The first answer is on us.

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