Business Metric Glossary
Short, practical definitions of the metrics behind every calculator on this site.
CAC (Customer Acquisition Cost)
The average cost of winning one customer.
LTV (Customer Lifetime Value)
What a customer is worth over the whole relationship.
MRR (Monthly Recurring Revenue)
Normalized monthly subscription revenue.
ARR (Annual Recurring Revenue)
Recurring revenue annualized.
ROAS (Return on Ad Spend)
Revenue earned per dollar of ads.
ROI (Return on Investment)
Net gain relative to what was invested.
COGS (Cost of Goods Sold)
Direct cost of what you sold.
Gross Margin
Share of revenue left after product costs.
Net Margin
Share of revenue left after everything.
Markup
Profit as a percentage of cost.
Churn
The rate at which customers or revenue leave.
Retention
The share of customers who stay.
Conversion Rate
Visitors who take the desired action.
CPA (Cost per Acquisition)
What each conversion costs.
CPC (Cost per Click)
What each ad click costs.
CPM (Cost per Mille)
Cost per 1,000 impressions.
CTR (Click-Through Rate)
Impressions that earn a click.
Break-Even Point
Where revenue exactly covers all costs.