Project Management Answers

What is customer lifetime value?

Q: What is customer lifetime value?


Q: What is the lifetime value of a customer?

  • How much revenue is gained versus how much was spent
  • A business’s total number of customers
  • The process a customer follows to purchase
  • The average revenue generated by customers over a certain period

Explanation: Customer Lifetime Value (CLV or LTV) is a metric that represents the total revenue a business expects to earn from a customer throughout their entire relationship. It is an essential metric to use to have an idea of the customer’s long-term worth to the company. CLV takes into consideration the buying patterns of the client, the frequency of the customer’s transactions, and the anticipated length of the connection between the consumer and the firm.

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