CLV / LTV
Category: E-commerce
Also searched as: Customer lifetime value
Definition (plain English)
Customer lifetime value estimates the gross profit or contribution a customer generates across future purchases.
Why it matters commercially
LTV tells teams how much acquisition spend, discounts, samples, and service cost are justified for a customer segment.
Example
A coffee importer accepted a low first-order margin because repeat subscription orders recovered CAC within four months.
Common mistake
Using revenue as LTV instead of contribution after COGS, fulfillment, returns, payment fees, discounts, and churn.
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