Company Context
FitMeal is a 6-year-old direct-to-consumer healthy meal subscription company operating in 20 U.S. metro areas. It generated $96M revenue last year, is growing 18% annually, and has a strong position in premium urban households, but growth has slowed over the last two quarters. Management is deciding where to allocate the next growth budget and wants a rigorous view of LTV versus CAC across multiple opportunities rather than simply chasing top-line volume.
Strategic Situation
You are the incoming Head of Growth Strategy. The CEO has asked you to recommend which of three growth opportunities FitMeal should prioritize over the next 12 months. The options are materially different in acquisition cost, retention quality, and operational complexity:
- Paid social expansion into 10 new metro areas
- Employer wellness partnerships targeting mid-sized companies
- Referral-led growth in existing markets through member incentives
The core question is not just which channel adds the most customers, but which one creates the most durable and scalable value once customer lifetime value, payback period, and execution risk are considered.
Data Points
| Metric | Current Business | Paid Social Expansion | Employer Partnerships | Referral Program |
|---|
| Average order value per week | $68 | $64 | $72 | $69 |
| Gross margin | 42% | 39% | 45% | 43% |
| Avg. customer lifespan | 8 months | 5 months | 11 months | 9 months |
| Fully loaded CAC | $118 | $165 | $310 | $55 |
| Estimated year-1 new customers | — | 18,000 | 7,500 | 10,000 |
Additional facts:
- Customers order 4.1 weeks per month on average.
- The company has $6M incremental growth budget for the next 12 months.
- Operations estimates paid social expansion would require $1.2M in new city-launch costs.
- Employer partnerships would require $900K in B2B sales and onboarding investment.
- Referral growth would require $400K in product and incentive setup costs.
- Finance wants all growth bets to target payback within 12 months.
Deliverables
- Calculate and compare the LTV, CAC, and LTV:CAC ratio for each growth opportunity.
- Assess whether LTV:CAC alone is sufficient for prioritization, or whether other metrics should materially influence the decision.
- Recommend which opportunity FitMeal should prioritize first, and whether the company should sequence or combine bets.
- Identify the most important risks, assumptions, and sensitivity drivers behind your recommendation.
- Propose a high-level go-to-market plan and success metrics for the chosen path.
Constraints
- Recommendation must fit within the $6M budget.
- Leadership wants visible growth impact within two quarters.
- Operations can support only one major new capability build this year.
- The board is concerned about pursuing channels with attractive headline growth but weak retention economics.
