Is this LTV:CAC Ratio calibrated for e-commerce?

Yes — the formula and inputs are universal, but interpretation, benchmarks, and what good looks like differ by industry. SAZ has run ltv:cac ratio engagements with e-commerce operators and shaped benchmarks accordingly.

What does good look like in e-commerce?

Industry benchmarks vary by sub-segment, deal size, and growth stage. Use the SAZ ltv:cac ratio and compare against the typical range shown on the main tool page, then talk to a senior partner to interpret your specific situation.

Where does 3:1 come from?

3:1 is the benchmark from SaaS Capital and OpenView — it balances acquisition investment with capital efficiency.

LTV:CAC Ratio · E-commerce

LTV:CAC Ratio for E-commerce.

The single most important unit-economics metric.

E-commerce engineered for unit economics.

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Finance & Strategy · E-commerce

Why e-commerce operators use the ltv:cac ratio.

Calculate the ratio of customer lifetime value to acquisition cost. Industry benchmark is 3:1 — below that, you're subsidizing growth; above 5:1, you're probably under-investing in acquisition.

E-commerce has moved from a margin-rich category to one where unit economics decide who survives. SAZ helps DTC, B2B e-com, and marketplaces sharpen positioning, fix margins, and build the demand and retention programs that compound.

Benchmarks

What good looks like — typical ranges to compare against.

< 1×

Losing money on every customer

1–3×

Recovering acquisition — but slow

3–5×

Healthy — keep scaling

> 5×

Likely under-investing in acquisition

The formula

How ltv:cac ratio is calculated.

LTV:CAC = Customer Lifetime Value ÷ Customer Acquisition Cost

Industry context

What changes when ltv:cac ratio is applied to e-commerce.

Unit economics, CAC, and LTV

Site, funnel, and merchandising

Lifecycle and retention

Fulfillment and ops

Run the numbers

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LTV:CAC Ratio · E-commerce

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