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Customer Lifetime Value Calculator
Use this customer lifetime value calculator to estimate how much value a customer generates across their lifespan.
Customer Lifetime Value Calculator
Enter your numbers and the result updates straight away.
Outputs
Planning estimate only. Verify assumptions before making a financial decision.
If average order value is $85, purchase frequency is 4 per year, gross margin is 0.55, and customer lifespan is 3 years, estimated CLV is $561.
How this calculation works
This calculator applies the stated clv = average order value * purchase frequency * gross margin * customer lifespan formula to the values entered above.
How to interpret the result
Estimate customer lifetime value. Compare the result with your own historical performance, operating assumptions, and downside case before acting.
Limitations
Results are educational planning estimates. They do not include every tax, legal, accounting, financing, or business-specific consideration and are not professional advice.
Formula and example
If average order value is $85, purchase frequency is 4 per year, gross margin is 0.55, and customer lifespan is 3 years, estimated CLV is $561.
Common use cases
- Compare customer value against CPA or CAC.
- Forecast the payback of acquisition programs.
- Model retention improvements and their financial effect.
Customer Lifetime Value Calculator FAQ
Should gross margin be entered as a percentage or decimal?
This calculator accepts a percentage input and converts it internally to a decimal.
Is CLV always precise?
No. CLV is an estimate based on averages, so it is best used for planning and comparison.
Can I use months instead of years for lifespan?
Yes, as long as purchase frequency uses the same time basis. Keep the units consistent.
Why is CLV useful?
CLV helps you understand how much you can spend to acquire and retain customers responsibly.