Customer Lifetime Value (LTV) Calculator
How much is a customer worth over their whole relationship with you? Compute LTV — and the max you should spend to acquire one.
CRM and retention analytics tools
Learn moreWhy LTV drives growth
Lifetime value tells you how much each customer is truly worth, which sets the ceiling on what you can profitably spend to acquire and keep them. Raising LTV — through retention, higher order value, or better margins — is often more powerful than chasing new customers.
How it’s calculated & sources
LTV = average purchase × purchases per year × lifespan × gross margin. We use margin (not revenue) so LTV reflects real profit per customer.
Benchmark: keep customer acquisition cost under ~1/3 of LTV (an LTV:CAC ratio of 3:1 or better).
Results update as you type and are general estimates, not personalized financial, tax, medical or legal advice. Verify with a professional.
Worked example
An $80 order, 6 times a year for 4 years at 60% margin is about $1,150 of lifetime value — so aim to spend under ~$380 to acquire each customer.
Frequently asked questions
Should I use revenue or margin?
Margin — LTV should reflect the profit a customer generates, not gross sales, so you don’t overspend on acquisition.
How do I estimate lifespan?
Use 1 ÷ your churn rate, or your average observed retention. Even a rough figure makes LTV useful for budgeting.