Customer lifetime value calculator

Lifetime value is the gross profit a typical customer brings over their relationship with you.

Your answer

Customer lifetime value$320.00
Expected lifespan3.3 years
Gross profit per year$96.00
CLV : CAC7.1 : 1
CAC payback5.6 months

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How we worked it out

Updated as you change the numbers.

  1. CLV = order value × orders per year × margin × years. With churn c, expected years = 1 ÷ c.

Method and assumptions

A CLV:CAC ratio around 3:1 is a common benchmark for a healthy business. This simple model ignores discounting future profit.

Questions

What is the lifetime value of a $60, 4-times-a-year customer at 40% margin and 30% churn?

About $320 over 3.3 years.

Sources

Method and figures checked on . Every worked answer on this page is covered by an automated test. Found a mistake? Tell us.

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