Customer Lifetime Value Calculator
Simple CLV
Calculate CLV using average purchase value and customer lifespan
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CLV with Profit Margin
Calculate CLV based on profit margin, not just revenue
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CLV:CAC Ratio
Calculate the ratio of customer lifetime value to acquisition cost
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Formula
Simple CLV = Avg Purchase Value × Frequency × Lifespan | Profit CLV = Gross Profit × (Retention / (1 + Discount - Retention)) | CLV:CAC Ratio = CLV / CAC
Frequently Asked Questions
What is Customer Lifetime Value (CLV)?
CLV is the total revenue or profit a business can expect from a single customer over their entire relationship. It helps determine how much you can spend to acquire customers (CAC) while remaining profitable. CLV = Average Purchase Value × Purchase Frequency × Customer Lifespan.
What is a good CLV:CAC ratio?
A CLV:CAC ratio of 3:1 or higher is considered healthy. This means each customer generates 3x what it costs to acquire them. Below 1:1 means you're losing money on each customer. SaaS companies typically target 3:1 to 5:1. Above 5:1 may mean you're underinvesting in growth.
How can I increase CLV?
Improve retention (reduce churn), increase purchase frequency (loyalty programs, email marketing), increase average order value (upsells, cross-sells, bundles), improve customer experience, and build switching costs into your product.
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