Core Business KPIs Explained: LTV, CAC, and Churn

Understanding your business's health requires more than just looking at the top-line revenue. The true story is told through your Key Performance Indicators (KPIs).

## 1. Customer Acquisition Cost (CAC) CAC represents how much you spend on sales and marketing to acquire a single new customer. It's calculated by dividing total sales and marketing expenses by the number of new customers acquired during that period.

## 2. Lifetime Value (LTV) LTV is the projected revenue a single customer will generate over the entire duration of their relationship with your business. An ideal LTV:CAC ratio is generally considered to be 3:1 or higher.

## 3. Churn Rate This is the percentage of customers who cancel their subscription or stop buying from you within a given timeframe.

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Monitoring KPIs with AI

Traditionally, tracking these metrics required complex BI dashboards that only analysts could update. Now, you can simply ask your database.

By connecting your production database to SUDTCore Analyst, you can type "Show me the CAC to LTV ratio for Enterprise customers this quarter"and get an instant, presentation-ready chart.

Not sure where your business stands? Use our Free KPI Checker to benchmark your current metrics against industry standards.