Customer Lifetime Value Calculator – LTV
Calculate customer lifetime value (LTV or CLV) to guide acquisition cost and retention decisions.
About This Calculator
Calculate customer lifetime value (LTV or CLV) to guide acquisition cost and retention decisions. Use the calculator above for instant results.
Worked Examples
- Annual: $400 | LTV: $1,200 | Max CAC: $400
Answer: LTV = $1,200
- Annual: $600 | LTV: $1,200 | Max CAC: $400
Answer: LTV = $1,200
- Annual: $150 | LTV: $750 | Max CAC: $250
Answer: LTV = $750
Who Uses This Calculator?
Set customer acquisition budgets.
Optimize LTV:CAC ratio.
Understand customer economics.
Evaluate unit economics.
Common Mistakes to Avoid
❌ Not including churn
LTV assumes average lifespan. Higher churn = lower LTV. Improve LTV by reducing churn.
❌ Confusing revenue LTV with profit LTV
LTV should be based on gross profit, not revenue. A $1,200 LTV with 40% margin = $480 profit LTV.
Frequently Asked Questions
LTV:CAC ratio?
Target 3:1 or higher. LTV $1,200 / CAC $400 = 3:1. Below 3:1 means slow payback or unprofitable growth.
CAC (Customer Acquisition Cost)?
Total marketing and sales spend divided by new customers acquired. CAC = $100,000 spend / 200 customers = $500 CAC.
Payback period?
CAC / monthly gross profit per customer. CAC $500, monthly gross $50 = 10-month payback.