What is Lifetime Value to Customer Acquisition Cost ratio of EarlyTech Company given the following estimates:

• 1) Customers are expected to pay for an annual subscription of $240 at the beginning of the year for a maximum of 3 years
• 2) Each year, 20% of the remaining customers will not renew their subscription
• 3) To determine lifetime value, use a discount rate of 15%
• 4) The company attains customers through Google Ads for which it pays $0.30 a click
• 5) It takes about 1000 clicks to get 2 customers

Answer rating: 100% (QA)

1 First lets calculate the Lifetime Value LTV of a customer To do that we need to determine the expe... View the full answer