Free toolsCustomer lifetime value calculator
Customer lifetime value calculator and max cost per customer
Work out what one customer is worth over time, and the most you can afford to pay to win one.
Change any number and the results update. Everything stays in your browser; nothing is saved or sent.
How to use the lifetime value calculator
- Enter your average order value and how many times a customer orders per year.
- Enter how many years a typical customer keeps buying.
- Add your gross margin and other costs per order.
- Set the share of profit you want to keep: the rest is the most you can spend to win a customer.
The CLV formula
Customer lifetime value = gross profit per order × orders per year × years. Max cost per customer = lifetime value × (1 − the profit share you keep).
Why lifetime value matters for ads
If customers come back, you can afford to pay more for the first order than one order alone would allow. Products that get used up (skincare, supplements, pet food) usually have a higher lifetime value than one-off purchases.
More: subscription revenue calculator and break-even ROAS calculator.
FAQ
Should LTV use revenue or profit?
Profit. Revenue-based LTV makes customers look more valuable than they are and leads to overspending on ads.