Plain-language meaning
Customer lifetime value, often shortened to CLV or LTV, estimates how much value a customer may generate before they churn. It is often compared with acquisition cost to judge whether growth is economically sustainable.
Example
A subscription customer paying 40 per month with 80% gross margin and an expected lifetime of 24 months has an estimated gross LTV of 768.
Limitations
LTV is highly assumption-sensitive. Retention, gross margin, expansion revenue, discounts, support cost and cohort quality can all change the result, and early-stage businesses often have limited retention history.
How this term affects your result
Customer lifetime value affects the result through the units, time period, rate, threshold or method used by the related calculator. Read it together with the page's formula and assumptions before comparing results across tools or sources.
What to check
- Use the same unit system, currency and time period as the related calculator.
- For regulated, health, tax, finance, safety or live-data topics, check the primary source named on the related page.
- If the term is used as a threshold, rate or category boundary, confirm the exact definition before relying on the estimate.
FAQ
Is Customer lifetime value defined the same way everywhere?
Not always. Some terms are mathematical and stable, while others vary by country, institution, industry, product or data source.
Why link glossary terms to calculators?
Calculator users often need the term at the moment they interpret a result. Linking the definition to the calculator reduces ambiguity.