Customer Lifetime Value (CLV) Explained: How to Calculate and Improve It
In today’s competitive market, businesses can no longer rely on one-time purchases to stay profitable. Instead, Customer Lifetime Value (CLV) has become a key metric for long-term growth, helping brands understand the total revenue a customer is expected to generate throughout their relationship with a company. But what is CLV exactly, and why does it matter?
Customer Lifetime Value measures how much profit a business can earn from a single customer over time. By focusing on CLV, companies can refine their marketing strategies, improve customer retention, and make data-driven decisions to maximize profitability. Understanding and calculating customer lifetime value allows businesses to shift from short-term gains to sustainable revenue growth.
In this guide, we’ll break down what customer lifetime value is, how to calculate CLV using different formulas, and strategies to improve it. Whether you’re running an e-commerce store, SaaS business, or a subscription service, mastering CLV can give you a competitive edge. Continue Reading