Free tool
Customer cost and payback calculator
Winning a customer costs money, and what they buy over the months after has to pay it back. See what a customer costs you, how many months of their buying earn it back, and what they're worth if they stay.
Example numbers to start (example number: Made up to show how the calculator works). The starting numbers are a made-up small shop, not real figures. Type your own: they stay on this page and aren't sent anywhere.
Ads, first-order discounts, free samples: what you paid to win new customers over a stretch of time, like a month.
Over the same stretch of time.
On average. If they buy every few months, spread it out: a $60 order every 3 months is $20 a month.
Your margin on what they buy, after the product, packing, shipping and fees.
How long they keep buying, on average. Leave it blank to skip.
Cost to win a customer
$50.00
$2,000 of marketing for 40 new customers. Owners call it the customer acquisition cost.
Pays back in
5 months
Each customer leaves $10.00 a month after what they buy costs you. It takes until month 5 to earn back the $50.00, so their first month of buying doesn't cover it.
Lifetime value, over 8 months
$80.00
What a customer leaves you while they stay. After the $50.00 to win them, that's $30.00 each.
How it's worked out
Cost to win a customer = marketing spend ÷ new customers. → $2,
Left a month = what a customer spends a month × the share left. → $25.00 × 40% = $10.00
Payback = cost to win a customer ÷ what's left a month, in months. → $50.00 ÷ $10.00 = 5 months
Lifetime value = what's left a month × months they stay. → $10.00 × 8 = $80.00
Learn the idea behind it
A calculator gives you the number. The lesson shows you what it means and what to do about it.
Lesson
What does a customer cost?(members-only)
Follow a shop's ads from click to customer, see why a first order may not pay for winning a buyer, and decide whether an ad pays.
Take the lesson
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For learning, not financial advice. See all the tools.