---
title: CPC, CPA, ROAS, LTV, CAC — Complete Calculation Guide | RGM®
url: https://realgrowthmatters.com/learn/measurement/cpc-cpa-roas-calculation-comprehensive/
updated: 2026-06-10
source_html: https://realgrowthmatters.com/learn/measurement/cpc-cpa-roas-calculation-comprehensive/
---

# CPC, CPA, ROAS, LTV, CAC — Complete Calculation Guide with Examples

Marketing metric calculations explained with formulas, examples, and benchmarks. CPC, CPA, ROAS, CTR, CVR, LTV, CAC, payback period, MER — all the formulas marketers should know by heart.

Marketing metrics aren't just numbers — they're decision-making tools. Knowing the formulas isn't enough; understanding when to use which metric, what's wrong about the obvious calculation, and what the number doesn't say is what separates operators from button-pushers.

## Cost metrics

- **CPC (Cost Per Click)**: Total Spend / Total Clicks
- **CPA (Cost Per Acquisition)**: Total Spend / Total Conversions
- **CPM (Cost Per Mille)**: (Total Spend / Total Impressions) × 1,000
- **CPV (Cost Per View)**: Total Spend / Total Views (video)
- **CPCV (Cost Per Completed View)**: Total Spend / Completed Views
- **CPL (Cost Per Lead)**: Total Spend / Leads Generated
- **CPI (Cost Per Install)**: Total Spend / App Installs
- **CPS (Cost Per Sale)**: Total Spend / Total Sales (synonym for CPA in commerce)

## Rate metrics

- **CTR (Click-Through Rate)**: (Clicks / Impressions) × 100
- **CVR (Conversion Rate)**: (Conversions / Clicks or Visitors) × 100
- **VCR (Video Completion Rate)**: Completed Views / Started Views
- **Engagement Rate**: (Engagements / Reach or Impressions) × 100
- **Bounce Rate**: (Single-Page Sessions / Total Sessions) × 100
- **Open Rate (Email)**: (Opens / Delivered) × 100
- **Click Rate (Email)**: (Clicks / Delivered) × 100
- **Click-to-Open Rate (CTOR)**: (Clicks / Opens) × 100

## Return metrics

- **ROAS**: Revenue Attributed to Ads / Ad Spend (expressed as multiplier or %)
- **ROI**: (Gain - Cost) / Cost × 100%
- **MER (Marketing Efficiency Ratio)**: Total Revenue / Total Marketing Spend
- **Profit ROAS**: Profit from Ads / Ad Spend
- **Contribution Margin ROAS**: Contribution Margin / Ad Spend
- **POAS (Profit on Ad Spend)**: Synonym for Profit ROAS
- **tROAS Target**: Goal ROAS for bidding strategies (e.g., 4.0 = 400% return)

## LTV and CAC

- **Simple LTV**: Average Order Value × Average Purchase Frequency × Customer Lifespan
- **Cohort LTV**: Sum of revenue from cohort divided by cohort size, projected forward
- **Predictive LTV**: Statistical models (BG/NBD, Gamma-Gamma) estimating future value
- **CAC (paid)**: Paid Acquisition Spend / Customers Acquired Through Paid
- **Blended CAC**: All Marketing Spend / All Customers Acquired (organic and paid)
- **Fully-Loaded CAC**: Total Customer Acquisition Cost including salaries, agencies, tools
- **LTV:CAC Ratio**: Customer Lifetime Value / Customer Acquisition Cost (3:1 is healthy benchmark)
- **CAC Payback Period**: CAC / (Monthly Contribution Margin per Customer), in months

## SaaS-specific calculations

- **MRR (Monthly Recurring Revenue)**: Sum of monthly subscription value across active customers
- **ARR (Annual Recurring Revenue)**: MRR × 12, or sum of annual subscription value
- **Net New MRR**: New MRR + Expansion MRR - Contraction MRR - Churned MRR
- **Net Revenue Retention (NRR)**: (Starting MRR + Expansion - Contraction - Churn) / Starting MRR × 100
- **Gross Revenue Retention (GRR)**: (Starting MRR - Contraction - Churn) / Starting MRR × 100 (no expansion)
- **Quick Ratio**: (New + Expansion MRR) / (Churn + Contraction MRR)
- **Magic Number**: (Current Quarter Revenue - Previous Quarter Revenue) × 4 / Previous Quarter S&M Spend
- **Rule of 40**: Revenue Growth Rate (%) + Profit Margin (%) ≥ 40 indicates SaaS health
- **Burn Multiple**: Net Cash Burn / Net New ARR

#### RGM Experts Say

The metric most marketers calculate wrong is LTV. The simple formula (AOV × Frequency × Lifespan) assumes constant behavior — which is rarely true. Use cohort-based actual LTV for historical analysis and predictive models for forward-looking. Decisions made on the simple formula often dramatically over-state customer value, leading to overspending on CAC.

## Email-specific calculations

- **Email Deliverability Rate**: Delivered / Sent × 100
- **Email Bounce Rate**: Bounces / Sent × 100
- **Hard Bounce Rate**: Permanent bounces / Sent × 100
- **Soft Bounce Rate**: Temporary bounces / Sent × 100
- **Open Rate**: Unique Opens / Delivered × 100
- **Click Rate (CTR)**: Unique Clicks / Delivered × 100
- **Click-to-Open Rate (CTOR)**: Unique Clicks / Unique Opens × 100
- **Unsubscribe Rate**: Unsubscribes / Delivered × 100
- **Complaint Rate (Spam Rate)**: Complaints / Delivered × 100
- **List Growth Rate**: (New Subscribers - Unsubscribes - Bounces) / Previous Total × 100

## Reach and frequency

- **Reach**: Unique users exposed to campaign
- **Frequency**: Total Impressions / Reach (Unique Users)
- **GRP (Gross Rating Points)**: Reach × Frequency × 100
- **TRP (Target Rating Points)**: GRP weighted by target audience
- **Effective Reach**: Reach at minimum frequency threshold (e.g., 3+ exposures)
- **Effective Frequency**: Frequency needed for ad effect (typically 3-7 exposures)

## Related guides

- See [CPM calculations](/learn/measurement/cpm-calculation-comprehensive/)
- See [statistical significance](/learn/measurement/statistical-significance-calculation-comprehensive/)
- See [MMM guide](/learn/measurement/marketing-mix-modeling-guide/)

## Sources

1. [1]IAB standards; SaaS Capital benchmarks; Reichheld NPS framework

### Related guides

- [CPM calculations](/learn/measurement/cpm-calculation-comprehensive/)
- [Statistical significance](/learn/measurement/statistical-significance-calculation-comprehensive/)
- [MMM guide](/learn/measurement/marketing-mix-modeling-guide/)