CLV Calculator
Estimate Customer Lifetime Value from average purchase value, purchase frequency, and customer lifespan.
CLV : CAC Ratio
Healthy — strong return on acquisition spend
How Customer Lifetime Value (CLV) is calculated
Customer Lifetime Value estimates the total revenue (or profit) a business can expect from a single customer over the entire span of the relationship. The core formula multiplies three inputs together:
CLV = Average Purchase Value × Purchase Frequency × Customer Lifespan
Average purchase value and purchase frequency combine into the annual customer value — how much revenue one customer generates per year. Multiplying that by the average number of years a customer stays gives the lifetime total. Enabling the gross margin toggle converts the revenue-based figure into a profit-based one, since not every dollar of revenue is a dollar of profit.
Comparing CLV against Customer Acquisition Cost (CAC) tells you whether your growth spend is sustainable. A CLV:CAC ratio below 1:1 means you lose money on every customer; a ratio of 3:1 or higher is the commonly cited benchmark for a healthy, scalable business.
Private & free — this tool runs entirely in your browser.