What is the difference between CLV and LTV?

They usually mean the same thing. In subscription businesses people sometimes compute LTV differently (for example from recurring revenue and churn); this page uses the purchase-based formula above unless you interpret margin as a net-profit overlay.

Why is CLV important for e-commerce?

Repeat purchases drive profitability. CLV helps you size retargeting, email, and loyalty spend against expected long-run revenue from a customer.

Free Business Analytics Tool

Customer Lifetime Value Calculator

This free customer lifetime value calculator helps startups, SaaS, and e-commerce teams estimate how much a typical customer is worth over time. Core math runs locally in your browser; Advanced mode adds profit margin and CAC analysis.

Free Customer Lifetime Value Calculator

Calculator mode

All calculator math runs in your browser. Sign-in is only required if you choose AI insights.

Industry

Not used in formulas. Select one if you want AI suggestions; otherwise you can leave this blank.

Average purchase value ($)

Must be a positive number (average order or contract value per purchase).

Purchases per year

Must be a positive number (purchases per customer per year).

Customer lifespan (years)

Must be a positive number (years the average customer stays active).

Enter average purchase value, purchases per year, and lifespan to see CLV. Industry is only needed for AI insights.

Recommended next steps based on what you're working on — pick up where this tool leaves off.

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How to Use This Customer Lifetime Value Calculator

Enter Purchase Data

Enter average purchase value and purchase frequency—the core inputs every customer lifetime value calculator needs. For SaaS, use annual contract value and renewals per year; for e-commerce, use average order value and repeat purchase rate.

Set Customer Lifespan

Enter how many years, on average, a customer keeps buying before churning. Longer relationships increase CLV.

See Your CLV & Optional ROI

Simple mode shows revenue-based CLV. Advanced mode adds profit margin and optional CAC so you can view LTV:CAC and an estimated payback window when CAC is provided.

Why CLV Matters

Plan Acquisition Spend

Knowing your CLV helps startups and SaaS teams set sensible acquisition budgets. Compare against CAC in Advanced mode to see LTV:CAC ratio and estimated payback period.

CAC Comparison (Advanced)

When you add CAC and a profit margin, the tool estimates LTV:CAC and how many months of profit it may take to recover acquisition cost—useful sanity checks, not a substitute for full finance modeling.

Retention Lever

Higher purchase frequency or longer lifespan directly multiplies CLV, which is why retention work often pays off.

Private by Default

Numbers you type stay in your browser for the calculator. AI insights are off until you click the button; only then is a short summary sent to generate suggestions, and that part requires a free account.

Common questions

What is Customer Lifetime Value (CLV)?+

CLV (or LTV) is the total revenue you expect from one customer over the whole relationship. This tool starts with the common model: average purchase × purchases per year × years active.

How is CLV calculated here?+

CLV (revenue) = Average purchase value × Purchases per year × Customer lifespan (years). Advanced mode can apply a profit margin percentage to approximate net-profit-based CLV before comparing to CAC.

What is a good CLV to CAC ratio?+

Many teams use roughly 3:1 lifetime value to CAC as a rough benchmark, using profit-based CLV when comparing to CAC—not headline revenue alone. Your industry and stage matter; treat it as guidance, not a rule.

How can I increase Customer Lifetime Value?+

Improve retention (longer lifespan), lift purchase frequency, or raise average order value where it fits. Small gains in any of those inputs compound in the formula.