How to use this customer lifetime value calculator
Enter values from the same reporting period and use consistent definitions. Then select Calculate. The tool performs the calculation locally in your browser and shows the result immediately.
Formula
Example
An $85 AOV, three purchases per year and 2.5-year lifespan gives $637.50 in lifetime revenue. At 55% gross margin, estimated gross-profit CLV is $350.63 before acquisition and overhead.
What this metric tells you
CLV puts first-order acquisition cost in a longer-term context. It is most useful for businesses with meaningful repeat purchase behavior and reliable cohort data.
How to interpret the result
- Use observed cohort retention when possible rather than optimistic assumptions.
- Gross-profit CLV is more decision-useful than revenue CLV when margins vary.
- Do not use future value estimates to justify unlimited acquisition spend; cash flow, payback period and uncertainty still matter.
Frequently asked questions
Is CLV the same as LTV?
In ecommerce, the terms are often used interchangeably, although companies may define them differently.
Should I include gross margin?
Including margin creates a more economically useful estimate than revenue alone.
What if customers buy only once?
Use a purchase frequency and lifespan that reflect that behavior; in a one-time purchase business, lifetime value may be close to first-order value.