Calculating customer ROI involves determining the revenue generated from a customer and subtracting the costs associated with acquiring and serving that customer. The formula is: Customer ROI = (Customer Lifetime Value - Customer Acquisition Cost) / Customer Acquisition Cost Customer Lifetime Value (CLV) is the total revenue a business expects to earn from a customer over their entire relationship. Customer Acquisition Cost (CAC) encompasses all costs related to acquiring a new customer, including marketing expenses and sales efforts.