CLV Calculator – Customer Lifetime Value

Published: 2026-04-04 · Tools · Ricky Bandelin

CLV, or customer lifetime value, is the total amount a customer will spend with your company over the lifetime that they are with you. This number helps you understand how much to invest to acquire a new customer, and how much you can invest in keeping them.

Key Takeaways

• Customer Lifetime Value is the total revenue your business can expect from a single customer throughout their relationship with you
• CLV helps you determine how much you can afford to spend to acquire a new customer while remaining profitable
• A higher CLV justifies higher customer acquisition cost, enabling more aggressive marketing investment
• Improving CLV is achieved through retention strategies, upsells, and loyalty programs that increase purchase frequency and average order value
• Comparing CLV by customer segment reveals which types of customers are most valuable to your business

To calculate CLV you will need the average amount of purchase and the number of times a customer buys per year. When it comes to the length of time a customer stays with you, you can use CRM software to calculate your average or find the average for your industry.

CLV = average value of a purchase × number of times the customer will buy each year × average length of the customer relationship (in years). For example, if your store sells an average of $150 worth of product once a year but keeps customers for an average of 10 years, the CLV would be $1,500.

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