The Metric That Determines Your Retreat Business Success

What if I told you there are people out there who give 100% of the purchase price to the person who refers them the customer?

Not 10%.


Why would they ever do something like this? You’d think it would sink their business, right?


These people understand CLV.

Customer Lifetime Value (CLV)

Customer Lifetime Value is the value of a customer to your business over their lifetime.

Say I send you a customer and that customer buys a $1000 retreat from you.

But then they love your retreat so much that they come back next year and go on another $1200 retreat.

Then they come back again and spend another $1000.

The gross revenue you’ll receive from that customer over their lifetime shoots up from $1000 to $3200.

When you start seeing the bigger picture, it opens up your mind to pay more money to acquire a customer.

And make no mistake, you are paying in some way to acquire your customers. Whether it is time you spend on social media or your blog, putting up flyers, or paying others to do work for you.

Either way you are paying.

Customer Acquisition Cost (CAC)

CAC stands for Customer Acquisition Cost.

It’s the amount of money it costs to acquire a customer.

Ideally you are able to spend $1 and get $2 back. When you do that, you’ve got a business with a solid foundation.

If you spend $100 to make $1000, does that sound like a good deal? Something you’d do over and over again?

Of course.

In this case, the Customer Acquisition Cost is $100.

In reality, you should be ok with spending $1000 to make $1000 on the first purchase. Why?

Because you’ve gained a customer. And that customer may tell their friends about you. That customer may come back and book another retreat with you.

If you want to grow your business, you need to start seeing the bigger financial picture of spending money on marketing.

Customer Lifetime Value Fully Explained

Key Highlights

  1. Determine your average order value. For retreats it is usually from $300 – $3000
  2. Determine how many times on average customers will come back and buy another retreat or other product from you
  3. Determine how much your customer will spend with you over their lifetime
  4. Determine how much overhead (your costs including the center, food, materials, etc.) per student you have for each retreat you run
  5. Determine how much margin you have, which you can use to pay to acquire a customer. This is the customer acquisition cost you can afford.


  1. Average order value = $1000
  2. Average repeat buys = 2
  3. Average lifetime spend = $2000
  4. Overhead per student for each retreat = $300 each (for 15 students)
  5. Margin available to pay to acquire customer who only buys 1 retreat = $700
  6. Margin available to pay to acquire customer who buys 2 retreats = $1700 (you just need to ensure you have the proper cash flow for this)

I know it might be a bit confusing, but it’s actually fairly simple.

If I make $700 per student, I can pay up to $700 to acquire that student. Why?

I am building my business by gaining customers who may purchase again, and tell their friends.

It’s ok to break even as you’re building.

Even better, utilize a great marketing channel like where you can pay $10 to make $100.

That’s good business.

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