Root-Causing a Monthly Decline in Subscriber Lifetime Value for Meal Delivery

You are the product manager for a meal delivery business that customers pay for by subscription. Customer lifetime value (LTV) has been falling month over month. Walk through how you would find the cause and what you would do about it. ```hint Split the metric before chasing causes Write LTV as a product of its drivers and ask which driver moved, and whether the change comes from how LTV is calculated, from who is signing up, or from how existing subscribers behave. ``` ### Clarifying Questions - How is LTV calculated: a predicted value for each month's new subscribers, or revenue earned per customer so far? Has the formula or any of its inputs changed recently? - Is LTV based on revenue, or on margin after food, packaging and delivery costs? - How large is each monthly drop, and did the decline begin suddenly or build gradually? - What changed around the time it started: prices, sign-up discounts, the menu, delivery areas, marketing channels or competitors? ### What a Strong Answer Covers - Confirming the decline is real, including definition changes, data problems, seasonality and newer cohorts having less history. - A breakdown of LTV into retention, order frequency, order value and margin, used to locate the driver that moved. - Segmentation by sign-up cohort, acquisition channel, promotion, plan and region to separate a mix shift from a change in subscriber behavior. - Internal and external hypotheses checked in a sensible order, with the evidence that would confirm or rule out each. - Fixes matched to the diagnosed cause and tested with experiments, with success metrics and guardrails such as acquisition volume and margin. ### Follow-up Questions - The whole decline traces to subscribers who joined through a new, deeply discounted sign-up offer. Is that a problem, and what would you do? - Cancellations are flat, but active subscribers skip more weeks than before. Which fixes would you try first, and how would you test them? - Finance proposes cutting the acquisition budget because LTV is falling. How would you respond?