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How do I work out the maximum I can afford to spend to acquire a customer?

Maximum affordable CAC is your customer lifetime value divided by the LTV:CAC ratio you are targeting — most operators aim for at least 3:1, so if a customer is worth 3,000 AED over their lifetime, you should not pay more than roughly 1,000 AED to acquire them. The exact figure also depends on margin, payback tolerance and cash constraints, which is where manual math gets error-prone.

Kando's Growth Economics Calculator does this for you: input AOV, margin and retention, and it outputs your maximum affordable CAC alongside LTV and payback period, so you can set acquisition budgets with a number you trust instead of a guess.

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Growth Economics CalculatorCAC — definition

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