Complete guide
Customer Lifetime Value Calculator: formula, example and decision guide
Estimate gross-profit customer value from order economics, purchase frequency and retention. The result updates instantly and keeps every assumption visible.
What the Customer Lifetime Value Calculator measures
Estimate gross-profit customer value from order economics, purchase frequency and retention.
Use the result to compare scenarios built from the same definitions and time period.
Formula and variables
The calculator applies LTV = order value × gross margin × annual frequency × lifetime. Each variable is entered in a labeled field and remains visible beside the answer.
LTV = order value × gross margin × annual frequency × lifetimeWorked example
$80 × 60% × 4 purchases × 3 years produces $576 gross-profit LTV.
Change one input at a time to see which assumption has the greatest effect on the result.
How to interpret the result
Read the main result together with the detailed rows; the headline number alone does not describe every cost, unit or assumption.
Save comparable scenarios with the copy, link, CSV or PDF controls.
Assumptions and limitations
This simple model does not discount future cash flows or model changing retention by cohort.
Real contracts, measurements, platform rules and professional standards can add inputs that this general-purpose model does not infer.
Accuracy checklist
Confirm units, time periods, fees and source figures before relying on the output.
Round the displayed answer only after the calculation; intermediate values retain full precision.
Calculation audit
| Item | What to review |
|---|---|
| Inputs | Average order value, Gross margin (%), Purchases per year, Average customer lifetime (years), Acquisition cost |
| Equation | LTV = order value × gross margin × annual frequency × lifetime |
| Example | $80 × 60% × 4 purchases × 3 years produces $576 gross-profit LTV. |
| Limit | This simple model does not discount future cash flows or model changing retention by cohort. |
Frequently asked questions
What does this Customer Lifetime Value Calculator calculate?
Estimate gross-profit customer value from order economics, purchase frequency and retention.
Which formula does it use?
LTV = order value × gross margin × annual frequency × lifetime
Does it calculate while I type?
Yes. Valid changes update the result automatically without reloading the page.
Which inputs should I verify?
Verify every unit, period, rate and fee against the source you are modeling.
Is the result exact?
This simple model does not discount future cash flows or model changing retention by cohort.
Can I save or share the result?
Yes. Copy, native sharing, WhatsApp, PDF/Print, CSV, comparison and parameterized links are available.
What to keep in mind
This simple model does not discount future cash flows or model changing retention by cohort.
Results display up to 8 decimal places; exported numbers preserve calculation precision. This is a calculation summary, not an official certificate.