Customer Lifetime Value
Calculator
Results
- Customer lifetime value
- 612
- Lifetime revenue per customer
- 1,020
- Annual value per customer
- 204
Results
| Customer lifetime value | 612 |
| Lifetime revenue per customer | 1,020 |
| Annual value per customer | 204 |
formula-map diagram
- Customer lifetime value
- 612
- Lifetime revenue per customer
- 1,020
- Annual value per customer
- 204
Formula breakdown
Formula
CLV = AOV × Purchase frequency × Lifespan × Gross margin%= 612
Note
This is a simplified model. Results use standard textbook definitions and ignore taxes, seasonality, attribution lag, discounting and accounting policy differences. Use them as an estimate, not as accounting, tax or investment advice.
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See all →Frequently asked questions
What does customer lifetime value (CLV) represent?+
CLV estimates the total revenue (or profit) a business can expect from a single customer over the entire duration of their relationship with the company. It helps businesses decide how much they can afford to spend acquiring and retaining customers.
How is a basic CLV formula calculated?+
A common simplified formula is CLV = average purchase value x purchase frequency x average customer lifespan. More advanced versions also factor in profit margin and discount future cash flows to present value.
How does churn rate affect customer lifetime value?+
Higher churn (customers leaving faster) shortens the average customer lifespan, which directly reduces CLV, since a customer generates revenue for fewer total purchase cycles before leaving. Reducing churn is one of the most effective ways to increase CLV without acquiring more customers.
Why is CLV usually compared against customer acquisition cost (CAC)?+
Comparing CLV to CAC shows whether the cost of acquiring a customer is justified by the revenue they'll eventually generate; a CLV:CAC ratio below 1 means the business loses money on every customer acquired, regardless of how much revenue they eventually bring in.
Is CLV a guaranteed prediction of future revenue?+
No — CLV is an estimate based on historical averages (purchase frequency, retention rates, order values), and actual customer behavior can shift due to market changes, competition, or product changes, so CLV should be revisited regularly rather than treated as a fixed number.