Calculator

Retention vs CAC Spread Calculator

Retention is only useful if it creates enough repeat contribution to clear the acquisition bill. Use this calculator to see whether cohort economics still work once retention rate and repeat contribution are priced honestly against CAC.

Estimate cohort contribution from first order plus repeat behavior
See the spread left after CAC
Measure the retention rate needed just to break even on acquisition

Compare retention contribution against CAC

Enter first-order contribution, repeat-order contribution, retention rate, repeat-order count for retained customers, and CAC. The result shows how much of the acquisition bill retention genuinely repairs.

Three cohort scenarios.

Formula

What the retention spread is measuring

Total expected cohort contribution = First-order contribution + (Retention rate × Average repeat orders if retained × Repeat-order contribution)

Spread after CAC = Total expected cohort contribution - CAC

This model is harsher than a revenue-based LTV/CAC story because it works from contribution, not topline. It is designed to answer one practical question: how much room does retention really buy back after acquisition is paid for?

Where retention stories get loose

Teams use repeat rate as a quality signal without pricing the repeat orders.
LTV/CAC gets discussed from revenue while contribution stays unknown.
Weak first-order economics get excused by vague retention optimism.

Where to go next

Once the retention spread is clear, compare it against first-order versus repeat margin and subscription math to decide whether the model really deserves a higher CAC.