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Customer lifetime value (CLV)

Customer Lifetime Value is a metric, displaying the profit that a customer has brought during the whole time of interaction with a company or a brand. The easiest way to calculate CLV is to multiply average annual customer profit with an average customer retention duration.

 

CLV provides an understanding of necessary expenses on customer acquisition, segmenting clients through their value for creating better offers and effective targeting. Finally, it helps to enhance the user experience for all customers’ categories.

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