Customer Lifetime Value (CLV) Calculator
Estimate customer lifetime value from average order value, purchase frequency, gross margin and retention — and compare it with acquisition cost.
How to use
- 1Enter average order value, orders per year and gross margin.
- 2Enter how many years a customer stays (or monthly churn for subscriptions) and your acquisition cost.
How it's calculated
CLV = average order value × orders per year × gross margin × customer lifespan (years). For subscriptions, lifespan = 1 ÷ churn rate. LTV:CAC = CLV ÷ customer acquisition cost.
Frequently asked questions
What's a good LTV:CAC ratio?
3:1 is a widely used benchmark. Below 1:1 you lose money on each customer; far above 3:1 may mean you're under-investing in growth.
Should CLV use revenue or profit?
Profit (gross margin) gives a more useful number for deciding how much you can spend to acquire a customer.
How do I estimate customer lifespan?
For subscriptions, 1 ÷ monthly churn gives months. For e-commerce, look at how long repeat buyers keep ordering.