LTV (Customer Lifetime Value) Calculator
Enter average order value, purchase frequency and customer lifespan to get customer lifetime value (LTV).
Average spend per transaction
How many times per year do they buy?
How many years does a customer stay?
Calculates margin-adjusted LTV
This tool is for information only and doesn't replace professional business or financial advice.
LTV or CLV (customer lifetime value) is the total net revenue a customer brings over their whole relationship with a business. It answers the question 'how much can I spend to win a customer?', which makes it one of the core metrics in growth marketing.
LTV Formula and Key Metrics
Basic LTV Formula
LTV = AOV × Purchase Frequency × Customer Lifespan
LTV needs three inputs: average order value (AOV), purchase frequency and customer lifespan.
LTV and CAC Balance (Unit Economics)
Read LTV together with CAC (customer acquisition cost), not on its own. An LTV:CAC ratio of 3:1 or more points to healthy growth. If what you spend to win a customer (CAC) is more than what you'll earn from them (LTV), the business model needs a rethink.
How Do You Increase LTV?
The most effective way to increase LTV is to keep customers longer (retention). Subscription models, cross-selling, loyalty programs and personalized email get customers to buy more often and for longer, which raises LTV substantially.
LTV and LTV:CAC Ratios by Industry
| Industry | Typical LTV | Typical CAC | LTV:CAC |
|---|---|---|---|
| SaaS (Enterprise) | $50,000+ | $10,000-20,000 | 3-5x |
| SaaS (SMB) | $2,000-10,000 | $300-1,500 | 3-5x |
| Finance & Insurance | $3,000-8,000 | $500-1,500 | 3-6x |
| E-commerce (Electronics) | $500-1,500 | $50-150 | 4-8x |
| E-commerce (Fashion) | $200-600 | $20-60 | 4-8x |
| Restaurant / Cafe | $1,000-2,500 | $10-30 | 40-100x |