Question 1

What is a good LTV:CAC ratio?

Accepted Answer

Three to one is the standard benchmark for a healthy business. Below one you lose money on every customer. Far above five and you are probably underspending — there is profitable volume you are leaving on the table.

Question 2

Should I use revenue or profit for LTV?

Accepted Answer

Gross profit, always. If your margin is 30%, a customer worth $1,000 in revenue is worth $300 to the business, and paying $400 to acquire them is a slow way to go broke.

Question 3

My conversion rate drops when I raise budget. Is that normal?

Accepted Answer

Completely. Platforms serve your cheapest, highest-intent audience first. Model the scaled campaign with a lower conversion rate and a higher cost per click, not the numbers from your current spend.