Lifetime Value

Lifetime Value (LTV) is a measure of the total revenue a business can expect to earn from a customer over the entire duration of their relationship. It helps companies understand how valuable each customer is, considering their repeat purchases and ongoing engagement. For example, if a customer buys a product now and continues to buy or use services over years, the combined revenue from all these interactions represents their LTV. Knowing this helps businesses make informed decisions about marketing, customer retention, and resource allocation to maximize long-term profitability.