Analytics•3 min read
Customer Lifetime ValueAlso known as: LTV or CLV
Definition
Total revenue expected from a customer over their entire relationship with a business.
Detailed Explanation
Lifetime Value (LTV or CLV) is a prediction of the total revenue a business can expect from a single customer account throughout their business relationship. Understanding LTV helps determine appropriate customer acquisition costs and identify the most valuable customer segments to target.
Key Points to Remember
- 1Helps determine sustainable CAC
- 2Higher LTV = more acquisition budget
- 3Retention improves LTV
- 4Segment by customer type
- 5Critical for subscription models