Metrics and measurement
Customer lifetime value (LTV, also CLV) estimates the total profit a company can expect from a single customer across the whole relationship.
It sets how much is worth spending to win that customer: it sits on the other side of acquisition cost, and with that figure alone in view spending gets judged on the price of the entry.
An example
A subscription services company finds that customers from one channel are cheap to win and cancel quickly, while customers from another cost twice as much and stay for years. Acquisition cost favours the first channel, lifetime value favours the second, and the decision comes from reading both.
What are your business challenges?
Tell us about your priorities and the objectives you want to reach.
You will receive a free, targeted answer within one working day.