Calculator
Customer Lifetime Value Calculator
Estimate customer lifetime value from average order value, purchase frequency, lifespan, and optional gross margin. Optionally compare LTV to CAC.
Customer lifetime value
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Average order value, frequency, and lifespan must be greater than 0.
Questions
- How do you calculate customer lifetime value?
- LTV = average order value × purchases per year × expected lifespan in years × (gross margin % / 100). Margin defaults to 100% when you leave it blank.
- What is a healthy LTV to CAC ratio?
- Under 3:1 usually means acquisition is too expensive for the value you keep. Over 5:1 often means you can spend more to acquire.
- Should margin be 0–100 or 0–1?
- Enter percent: 60 for 60%. The calculator converts it to a fraction in the formula.