GLOSSARY
Payback Period
What is Payback Period?
DefinitionPayback period is the number of months it takes for a customer’s cumulative gross profit to equal the cost of acquiring them. Shorter payback means faster, less cash-intensive scaling.
Formula
Payback (months) = CAC ÷ Monthly gross profit per customerSubscription health brands live and die on this: a GLP-1 program targeting sub-one-month payback can scale aggressively, while a longevity membership with 12-month payback needs far more working capital and channel discipline. Concretely, a hormone clinic with a $300 CAC (inside the $200–450 blended range across AdBoost Health partner accounts) earning $150 of monthly gross profit per patient pays back in two months. The subscription convention treats 12 months as the outer limit; past that, each new cohort ties up cash you cannot redeploy into the next one.
Related terms
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