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The number of days it takes for a customer cohort’s cumulative contribution margin to equal the cost of acquiring them.

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Formula

Payback Days = Days until Cumulative Contribution Margin ≥ CAC

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Formula Components

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Example

Your January cohort of 500 new customers cost $25,000 to acquire (CAC = $50/customer): Payback Days = 75 — it took 75 days for this cohort to generate enough contribution margin to cover their acquisition cost.

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How It Works

Payback Days tracks a customer cohort from acquisition through subsequent purchases, summing the contribution margin from each order. The metric identifies the day when cumulative contribution margin equals or exceeds the original customer acquisition cost. Shorter payback periods indicate healthier unit economics and faster reinvestment of marketing capital.

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When to Use

See all Lifetime Value metrics →