Acquisition policy

Max acquisition spend as % of predicted LTV: 25%

This case study models 800 prospective customer segments, each with a predicted lifetime value (LTV) from a model, and a true LTV the prediction only approximates. Marketing spends up to a fixed percentage of predicted LTV to acquire each segment; the question is how aggressive that percentage should be.

Portfolio outcome

Total acquisition spend—

Total true LTV acquired—

Net marketing ROI—

Segments: predicted LTV (x) vs. true LTV (y), size = spend