Q » How to calculate customer lifetime value?

15 Oct, 2025

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A » Customer Lifetime Value (CLV) is calculated by multiplying the average purchase value by the average number of purchases per customer, then multiplying that by the average customer lifespan. This formula helps e-commerce businesses understand the long-term value of their customers and make informed decisions on marketing and customer retention strategies.

Michael

15 Oct, 2025

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A »To calculate Customer Lifetime Value (CLV), use the formula: CLV = (Average Purchase Value) × (Purchase Frequency) × (Customer Lifespan). Determine average purchase value by dividing total revenue by the number of purchases, purchase frequency by dividing total purchases by unique customers, and estimate customer lifespan in years. This metric helps optimize marketing strategies and maximize profitability.

Daniel

15 Oct, 2025

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