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When do you earn back the cost of winning a customer?

Quick lesson1 min read

Compare the acquisition cost with the regular contribution after the variable costs of serving the customer. Using revenue instead of contribution makes the period look artificially short.

An example with numbers

Winning a customer costs $180. They pay $50 a month and serving them costs $20, so they contribute $30 a month. You earn back the $180 after six months if they stay and pay. If they leave in month four, you will only have recovered $120.

Try it with your numbers

Work out the period for a typical customer and compare it with how long customers won in the same period actually stayed.

Open the calculator

Example figures for learning purposes. They are not a recommendation and do not replace professional advice.

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