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NPV Contribution LTV Calculator
Evaluate the true Net Present Value (NPV) of your Customer Lifetime Value (LTV) by incorporating gross margins, annual churn, and financial discount rates.
Operational Variables
Average Order Value (AOV)
$80
(Average transaction value per customer purchase)
Annual Purchase Frequency (f)
3.0x
(Average number of purchases a customer makes per year)
Gross Contribution Margin % (m)
60%
(Gross margin percentage left after direct product cost-of-goods-sold)
Annual Customer Churn Rate % (c_a)
20%
(Percentage of customers who stop buying from you annually)
Annual Discount Rate % (d)
8%
(Your cost of capital or interest rate for cash discounting)
Customer Acquisition Cost (CAC)
$40
(Total marketing & advertising spend required to acquire one customer)
Projection Window (T in years)
3 Years
(Evaluation time frame for unit-economic net present value calculations)
Calculated Unit Economics
Net Discounted LTV (NPV)
$0
Simple revenue-only LTV is $0
LTV : CAC Efficiency Ratio
0.0x
Healthy Engine
CAC Payback Duration
0 Months
Time required to break-even on CAC spend