Customer Lifetime Value Calculator
Customer lifetime value, or LTV, estimates how much one customer brings in over the time they stay with you. Enter what a typical customer spends, and the page works out the total, then the part you keep after costs.
- Free
- Works offline after your first visit
- Saves on this device
- No sign-up
- Updated
How it works
Revenue per customer is the average order, times orders per year, times the years a customer stays. The margin-adjusted value takes off the share of that revenue spent making the product or service.
To compare with acquisition cost, divide the margin-adjusted value by what it costs to win one customer. If you leave the cost at zero, the ratio shows zero rather than a number.
Worked example
A typical customer brings in $720.00 in revenue. After margin, that is $432.00 of lifetime value, which is 3.6 times what it cost to win them.
Questions
Where should the years figure come from?
Use real data where you have it, such as how long past customers kept buying. A rough guess is fine for a first look, but say so when you share the number.
Why is margin included?
Revenue is not profit. Part of every sale pays for the product, so the margin shows what the customer leaves you to spend.
Does this allow for repeat buying?
Yes, through the orders per year. It assumes the same pattern each year, so change the inputs to test a bigger or smaller group.
More like this
- Average Order Value CalculatorWhat a typical order is worth.
- Customer Acquisition Cost CalculatorWhat it costs to win one new customer.
- Sales Tax CalculatorAdd sales tax to a price, or take it out of a total.
- Net Promoter Score CalculatorPromoter share minus detractor share, from survey counts.
- Markup CalculatorMarkup and margin from cost and selling price.
- Lead Time CalculatorExpected arrival from order date, production and shipping days.