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Wizzy Ai

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Abhilash Banerjee
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51 views3 pages

Wizzy Ai

Uploaded by

Abhilash Banerjee
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Key Metrics Formulas

1 Customer Lifetime Value (LTV)


• Basic Formula:

LTV = Average Purchase Value×Average Purchase Frequency×Average Customer Lifespan

• Alternative Formula (using churn rate):

Average Revenue Per Customer


LTV =
Churn Rate

2 Customer Acquisition Cost (CAC)


• Formula:
Total Sales and Marketing Expenses
CAC =
Number of New Customers Acquired

3 LTV to CAC Ratio


• Formula:
LTV
LTV to CAC Ratio =
CAC

4 Churn Rate
• Formula:
Customers Lost During Period
Churn Rate = × 100
Total Customers at Start of Period

5 Monthly Recurring Revenue (MRR)


• Formula:

MRR = Number of Customers × Average Revenue Per User (ARPU)

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6 Average Revenue Per User (ARPU)
• Formula:
Total Revenue
ARPU =
Total Number of Users

7 Average Purchase Value


• Formula:
Total Revenue
Average Purchase Value =
Number of Purchases

8 Average Purchase Frequency


• Formula:
Total Number of Purchases
Average Purchase Frequency =
Total Number of Customers

9 Average Customer Lifespan


• Formula:
Total Duration of Customer Relationships
Average Customer Lifespan =
Total Number of Customers

10 Conversion Rate
• Formula:
Number of Conversions
Conversion Rate = × 100
Total Visitors

11 Summary of Formulas
• LTV measures the total revenue expected from a customer.
• CAC calculates the cost of acquiring a new customer.

• LTV to CAC Ratio indicates customer acquisition efficiency.


• Churn Rate assesses customer retention.
• MRR gauges predictable monthly revenue.
• ARPU reflects revenue generation per user.

• Average Purchase Value and Frequency help estimate LTV.

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• Average Customer Lifespan gives insight into customer longevity.
• Conversion Rate measures the effectiveness of turning visitors into cus-
tomers.

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