I had a fun discussion with my accountant's dental client last week. He enquired about doing some pre M&A work.
He does a 'paid clean + check up' as a loss leader productised offer and that's what he sends his traffic to.
He started losing money on his offer and was starting to think he might stop running ads to the offer as the rest of his business was doing well.
I stopped him.
How much is the lifetime value of the customers that come through the offer?
He said he didn't know. So I told him to go to his dental business software and send me his sales data.
He sent me his excel sheet in an email with customer ID column. In Pandas I can do a groupby function and filter by that ID that came through on the ad offer.
He was attributing spend to the offer and not the CLV. So the goal he should have is having a customer for life and not the math of the moment (his ad spend).
If he keeps following-up with phone calls and email he would have a comfortable 1000% return on ad spend (aka 10x ROAS).