Work out what a customer is really worth over their lifetime — revenue LTV, profit LTV, and the maximum you can afford to pay to acquire one on Google Ads.
Get a free PPC auditA simple, robust LTV: AOV × orders per year × lifespan (years). Multiply by your profit margin to get profit LTV — the figure that actually matters for ad budgets.
If a customer is worth £288 in profit over their life, you can afford far more than one order’s margin to acquire them. Businesses that bid on LTV out-compete those bidding on first-order ROAS.
Multiply average order value by purchase frequency per year by customer lifespan in years. Apply your margin for profit LTV.
It sets the true ceiling on your cost per acquisition — bidding to LTV lets you win customers competitors can’t afford.
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