The MLV to MAC ratio is the measurement of the relationship between the lifetime value of a member and the cost of acquiring that member. Best Practice: Aim for 3:1 as the target ratio.
CALCULATION: MLV : MAC
Calculate your Member Lifetime Value (MLV) and Member Acquisition Cost (MAC).
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Example: In 2017, the average lifetime value per member was $1,275. $32,000 was budgeted for member recruitment and $28,875 was spent. Breaking down those numbers further means the budgeted recruitment cost was $425/ new member and the actual recruitment spend was $385/ new member.
- Goal ratio = 3 : 1 ($1,275 : $425)
- Actual ratio = 3.3 : 1 ($1,275 : $385)