Knowing your CLV is critical to knowing how much you can spend to acquire each customer to create a profitable relationship.

The Customer Lifetime Value (CLV) represents the total amount of money a customer is expected to spend with your business during their lifetime.

Here’s how to calculate your customer lifetime value

CLV = average value of a purchase x number of times the customer will buy each year x average length of the customer relationship in years.

For example, your customer average spend is £100.00 x 6 times per year x 5 years which gives you a CLV of £3000.00.

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