LTV: What a Customer Is Worth Over Time
Lifetime value turns a single sale into a long view. It tells you how much you can afford to spend winning a customer and still come out ahead.
What is the Lifetime Value Calculator?
Enter average monthly revenue per customer, gross margin, and average lifetime in months, and the tool estimates lifetime value. This is an estimate that assumes steady revenue and margin, so check it against real customer records before using it for budgets.
How to use it
- Enter monthly revenue per customer.
- Enter gross margin and average lifetime in months.
- Click Calculate LTV.
Worked example
With 50 monthly revenue, 60% margin, and 24 months, monthly gross profit is 30 and lifetime value is 720.
Why does margin matter for LTV?
Revenue alone overstates value, because costs eat part of every sale. Margin leaves only the profit a customer actually contributes.
Frequently asked questions
How do I find average lifetime?
Divide total customer-months by the number of customers, or use the average months between first and last purchase.
Does LTV include referrals?
Not here. This is direct value only; referrals are a bonus on top.