Customer Lifetime Value (CLV)

What is Customer Lifetime Value (CLV)?

What is Customer Lifetime Value (CLV)? Customer Lifetime Value (CLV) is the total amount of money a customer is expected to spend on a business’s products or services over their lifetime.

Explanation:

Understanding CLV helps businesses identify their most valuable customers and tailor marketing efforts to increase customer retention and profitability.

Practical Example of CLV:

A subscription service calculates the average revenue per user and multiplies it by the expected number of years a customer will stay subscribed.

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