What is two points of churn actually worth?
Average lifespan is roughly one divided by monthly churn, which means small improvements compound into large lifetime value gains.
Your numbers
Revenue churn if you have it, customer churn otherwise.
Blended, including salaries, tools and agency fees.
Lifetime value gain
+67%
From 5% to 3% monthly churn, with no change to acquisition.
Lifespan today
20 mo
LTV $2592
Lifespan at target
33 mo
LTV $4320
Extra CAC you could afford
$1728
Maximum acceptable CAC is lifetime contribution — so it moves with lifespan.
Cutting churn from 5% to 3% raises lifetime value 67% and lets you pay up to $1728 more per customer. In a competitive auction that's the difference between winning positions and being outbid — and it costs nothing in media.
Your current payback is about 3.2 months, which is workable. Churn improvements shorten it further.
Calculated in your browser — nothing is sent anywhere, and nothing is stored.
The maths, so it isn't a black box.
Lifespan from churn
Average customer lifespan is approximately 1 ÷ monthly churn rate. At 5% that's 20 months; at 3% it's 33 — a 65% increase from a two-point move.
Lifetime value in contribution, not revenue
Monthly revenue multiplied by gross margin gives what actually comes back each month. Using revenue overstates lifetime value by whatever your cost of delivery is.
The bid ceiling moves with it
Maximum acceptable CAC is lifetime contribution, so improving retention directly raises what you can afford to pay for a customer — which is how retention makes acquisition cheaper.
Payback shown alongside
Lifetime value is the ceiling; payback period is the cash constraint. Both matter, and a healthy ratio with long payback is still a cash-flow problem.
Questions about this calculation
Revenue churn if you have it. Customer churn weights a $50 account identically to a $5,000 one, which distorts the result badly when customer value varies. If the two diverge substantially, that gap is itself worth investigating.
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