Some customers may buy one product
Posted: Tue Feb 18, 2025 9:35 am
So which customer is more valuable to you? Of course the second group. But you need to measure something called lifetime value to know that. We call this measurement CLV (Customer Lifetime Value) or customer lifetime value.
Sometimes you may see this referred to as LTV. Knowing the lifetime value of a customer lets you know how much you can spend on advertising to acquire one customer. Coming up with this number can actually get quite complicated, so I would encourage you to explore CLV calculations in more detail, but generally you can get close with the following data.
You will need: Average annual purchases lebanon whatsapp number data per customer Mark your average And the average number of years you keep a customer Example of how to calculate CLV ( Customer Lifetime Value) Let's say we're selling dog toys online. So we pull up our ecommerce data and we see that most of our customers have made two purchases over the past few years.
So we can say that our average annual purchases per customer is two. all orders in our store is 80k. So we multiply the annual purchases by the average order value.
Sometimes you may see this referred to as LTV. Knowing the lifetime value of a customer lets you know how much you can spend on advertising to acquire one customer. Coming up with this number can actually get quite complicated, so I would encourage you to explore CLV calculations in more detail, but generally you can get close with the following data.
You will need: Average annual purchases lebanon whatsapp number data per customer Mark your average And the average number of years you keep a customer Example of how to calculate CLV ( Customer Lifetime Value) Let's say we're selling dog toys online. So we pull up our ecommerce data and we see that most of our customers have made two purchases over the past few years.
So we can say that our average annual purchases per customer is two. all orders in our store is 80k. So we multiply the annual purchases by the average order value.