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Sales & Retail vocabulary · Account Management

Customer lifetime value

Meaning in sales & retail, with examples

nounAdvanced term

In sales & retail, customer lifetime value means: The total revenue or profit a company expects to earn from one customer over the whole time that customer keeps buying from it.

In Turkish: müşteri yaşam boyu değeri, müşteri ömür boyu değeri

How it is used

Often shortened to CLV, CLTV or LTV. Used to decide how much to spend on winning and keeping customers. Teams compare it with customer acquisition cost (CAC): a healthy business earns much more from a customer than it spends to win them.

Example sentences

  1. Coffee subscribers have a high customer lifetime value because they keep ordering for years.

  2. Improving retention by just 5 percent would raise our customer lifetime value significantly.

Common collocations

  • increase customer lifetime value
  • CLV
  • lifetime value to CAC ratio
  • high-value customers
  • customer retentionA company's ability to keep its existing customers buying over time, instead of losing them to competitors.
  • churnThe loss of customers who stop buying or cancel their subscription or contract during a period; also the rate at which this happens.
  • upsellTo persuade a customer to buy a more expensive version, an upgrade or a bigger package than the one they first planned to buy.
  • cross-sellTo sell a customer a different but related product in addition to the one they are buying, such as a case with a new phone.
  • key accountOne of a company's most important customers, usually because of the size of its orders or its strategic value, which gets special attention and a dedicated manager.

This word in other fields

The same English word can have a different meaning in another field:

More terms: Account Management

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