Teaching · For Tutors · Growth

What one family
is worth, start
to finish.

Type your rate, how often a typical family meets and how long it stays. The calculator gives the profit from that family, adds the families it refers, and sets a ceiling for what to spend on winning the next one.

Value a familyWhat you get
$12one-time · every device you sign in on
Buy · $12

Included with Caveat Classroom and Whole-school licenses. Or get it in the Tutoring business kit, $69 for 64 items.

The client value calculator

The worked example is made up: $65 a session, six sessions a month, families staying about nine months, and roughly one in three referring another. Nothing you type leaves this browser.

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What you get

Teaching · For Tutors$12 · included with Classroom and Whole-school licenses

What you finish with
Revenue and profit from a typical family over its stay, the value with referrals, the most to spend to win a family, the worth of one more month and a table of profit by length of stay. It prints as a one-page summary and downloads as a spreadsheet.
Who it is for
Independent tutors and small tutoring businesses deciding how much to spend on advertising, free first sessions or referral thank-yous, and how much effort keeping families is worth.
Format
Browser calculator for a phone, tablet or computer, by touch or keyboard. Prints a summary; downloads a spreadsheet (.csv); export and import a file.
Access
$12 one-time, yours on every device you sign in on; the tool opens once you are signed in with it. Included with Caveat Classroom and Whole-school licenses. Also in the Tutoring business kit ($69) and the Teaching Suite pass ($199), and 1 more bundle. Everything you type stays in this browser; nothing is sent to Caveat.
Where it lives
The For Tutors space in Caveat Teaching.
Support
Questions, a correction or a request: team@caveatacademic.com.

How to use it

  1. Type your rate, sessions a month and cost per session.
  2. Type how many months a typical family stays, or the share who continue each month.
  3. Add the new families each family refers, on average, and choose a spending ceiling.
  4. Read the value of a family and the most to spend to win one.
  5. Print the summary or download the spreadsheet.

Value a family

How the value is worked out

A month of profit, times the months a family stays.

A typical family in the worked exampleA month$3606 × ($65 − $5)Over 9 months$3,240profit per familySpend to win one$1,080a third of itA typical familyA month$3606 × $609 months$3,240profitSpend to win one, at most$1,080a third of its profit
In the example a family brings $360 of profit a month and stays nine months, $3,240 in all; spending up to a third of that, $1,080, to win one leaves two thirds as profit.

The arithmetic

A month of profit is the rate minus your cost per session, times sessions a month. Lifetime profit multiplies that by the months a family stays. If you know the share of families who continue from one month to the next instead, the average stay is 1 ÷ (1 − that share): 90% continuing means about ten months. Referrals add each referred family’s value once, without counting the families they refer in turn.

Using it

The value sets a ceiling on what winning a family should cost: if a family brings $3,240 of profit, spending $1,080 to find one still leaves two thirds of it. The same number shows why keeping families matters: one more month together is worth as much as a full month of a new family, with none of the cost of finding them.

Sources

  1. Gupta, S., and Lehmann, D. R. (2003). Customers as assets. Journal of Interactive Marketing, 17(1), 9–24: customer lifetime value and retention.
  2. Farris, P. W., Bendle, N. T., Pfeifer, P. E., and Reibstein, D. J. (2010). Marketing Metrics, 2nd ed. Pearson: customer lifetime value, retention and acquisition cost.
  3. U.S. Small Business Administration, Marketing and sales guidance (sba.gov): budgeting for marketing.
  4. Internal Revenue Service, Publication 334, Tax Guide for Small Business: advertising and referral costs as business expenses.

The worked example is made up. Use averages from your own records; this page does arithmetic on them. Your figures stay in this browser. Support: team@caveatacademic.com.