How to Speak CFO: Proving Marketing ROI with LTV and CAC

Hi everyone,

In many boardrooms, there's a classic tension. The marketing team presents their campaigns, proud of the leads, clicks, and engagement they've generated. The finance team looks at the numbers and asks one simple question: "What was the return on this spend?"

For too long, marketing has been perceived as a "cost centre"—a necessary expense with ambiguous value. But what if you could change that narrative? What if you could prove, in the irrefutable language of finance, that your marketing department is one of the most powerful, predictable, and scalable growth engines in the entire business?

You can. The key is to connect your marketing activities directly to the financial metrics that matter most: Customer Lifetime Value (LTV) and Customer Acquisition Cost (CAC). This isn't just about defending your budget; it's about making a data-backed case for more investment.

The Bridge Between Marketing and Finance

In our last newsletter, we did a deep dive into calculating LTV and CAC. To recap, these metrics represent the two most fundamental pillars of a SaaS business:

• Customer Lifetime Value (LTV): The total revenue you expect from a customer. This is the Return.

• Customer Acquisition Cost (CAC): The total amount you spend to get a customer. This is the Investment.

The LTV:CAC ratio is the ultimate measure of your marketing and sales efficiency. A healthy ratio (ideally 3:1 or higher) proves you have a profitable growth model. But to truly justify investment, we need to go beyond a blended, company-wide ratio and apply this framework to our marketing channels.

From Blended Metrics to a Granular Business Case

A company-wide LTV:CAC of 5:1 is great, but it doesn't tell you where to invest your next pound. A powerful marketing engine is built on knowing which channels are performing and doubling down on them.

Here is a step-by-step framework to build an undeniable case for marketing investment.

Step 1: Segment Your CAC by Channel

First, stop looking at your blended CAC. Work with your finance team to accurately attribute all costs (ad spend, salaries, software tools) to the channels they support.

You will quickly see a more detailed picture emerge:

• Google Ads CAC: £850

• LinkedIn Ads CAC: £1,200

• Content Marketing (SEO/Blog) CAC: £400

Immediately, you can see that your content marketing efforts are acquiring customers far more efficiently than paid ads. But this is only half the story.

Step 2: Connect Channels to Customer Value (LTV)

Next, analyse the customers that come from each channel. Do certain channels bring in more valuable customers? You might find that customers who read your blog before signing up are better educated about your product, leading to lower churn.

• LTV of customers from Paid Ads: £5,000 (Average churn rate of 2%)

• LTV of customers from Content Marketing: £6,250 (Lower churn rate of 1.6%)

Now we see that not only is content marketing cheaper for acquisition, but it also brings in customers who are 25% more valuable over their lifetime.

Step 3: Calculate Channel-Specific LTV:CAC Ratios

This is where you build the foundation of your argument. By combining the data from the first two steps, you can showcase the phenomenal ROI of your most effective channels.

• Paid Ads LTV:CAC Ratio = £5,000 : £850 ≈ 5.9:1

• Content Marketing LTV:CAC Ratio = £6,250 : £400 ≈ 15.6:1

A 5.9:1 ratio is healthy and worth maintaining. But a 15.6:1 ratio isn't just healthy—it's a signal of a massive, untapped growth opportunity.

Building Your Investment Proposal

You are no longer just asking for more budget. You are presenting a data-backed investment opportunity with a predictable return. Here is how you frame the proposal for your CEO or CFO:

The Ask: "I am requesting an additional marketing investment of £50,000 for the next quarter."

Conclusion: Marketing as a Growth Investment

When you speak the language of finance, the conversation changes. You move from defending a budget to proposing a growth strategy. Marketing is no longer a line-item expense but a predictable, scalable investment with a clear and compelling ROI.

By mastering your metrics and presenting them effectively, you empower yourself to secure the resources you need to drive meaningful, sustainable growth for your company.

How have you successfully justified your marketing budget? Share your wins and strategies in the comments below!

If you're ready to build a data-driven framework to prove your marketing ROI, get in touch with the team at ZenithHQ.