Free customer economics tool

Customer Lifetime Value Calculator

Estimate how much revenue and gross profit one customer can generate over the relationship, then compare that value with your acquisition cost.

Simple calculator

Enter your customer economics

Updates live

Average purchase value

Average revenue from one order, invoice, job or billing event. Purchases per customer per year

per year

Gross margin

Revenue left after direct costs of delivering the product or service. Expected customer lifetime

years

Customer acquisition cost

Optional, but useful for LTV-to-CAC and net value. Target LTV-to-CAC ratio

Simple CLVAverage purchase value × purchase frequency × expected lifetime. Gross-profit CLV then applies your gross margin.

Customer value result

Lifetime value snapshot

Gross-profit lifetime value $1,650 Expected gross profit from one customer

LTV-to-CAC ratio 4.7×

Above target

Lifetime revenue$3,000

Annual revenue per customer$1,000

Annual gross profit$550

Net value after CAC$1,300

Maximum CAC at target ratio$550

CAC as % of gross-profit LTV21.2%

Value bridge$3,000 lifetime revenue

Direct costs

$1,350

Gross profit

$1,650

Acquisition cost

$350

OfficeQ readout

At the entered economics, one customer is expected to generate about $1,650 in lifetime gross profit before acquisition cost.

Advanced calculator

Model retention and customer economics

Updates live

Revenue & margin

Average purchase value

Purchases per active customer per year

per year

Gross margin

Refunds, credits & discounts

Annual revenue growth per retained customer

Annual service/support cost per customer

Retention & horizon

Annual customer retention rate

Constant annual retention assumption. 70% retention equals 30% annual churn. Analysis horizon

years

Annual discount rate

Reduces the value of future gross profit to a present-value estimate. One-time onboarding / success cost

Acquisition & portfolio

Customer acquisition cost

Target LTV-to-CAC ratio

New customer cohort size

customers

Current active customer base

customers

Used for annualized portfolio-value estimates.

Advanced modelEach future year is weighted by the probability the customer remains active, then future gross profit is discounted back to today.

Advanced result

Retention-adjusted customer value

Discounted gross-profit LTV $1,156 After retention, support cost and onboarding

LTV-to-CAC ratio3.3×Above 3.0× target

Implied lifetime3.3 yearsBased on constant churn

Expected lifetime revenue$3,178

Undiscounted gross-profit LTV$1,470

Net value after CAC$806

Maximum CAC at target ratio$385

100-customer cohort value$115,600

Active-base annual gross profit$235,000

Retention economics30.0% annual churn

Year 2 active70%

Year 3 active49%

Year 5 active24%

OfficeQ readout

Retention-adjusted customer value is above the selected acquisition target, but retention changes can materially move the result.

Sensitivity

See how retention changes customer value

All other assumptions held constant

Scenario	Annual retention	Implied lifetime	Discounted GP LTV	LTV:CAC	Signal

Year-by-year model

Expected customer value by year

Probability-weighted expected economics

Year	Active probability	Expected revenue	Expected gross profit	Discounted gross profit	Cumulative discounted LTV

Reading the result

Revenue is useful. Gross-profit value is usually more useful.

Lifetime revenue tells you how much customer spending may pass through the business. Gross-profit lifetime value removes the direct cost of delivering that revenue, which makes it more useful for acquisition and retention decisions.

The Advanced model adds retention, customer support cost and a discount rate. It is still an estimate, not a prediction. Use cohort data from your own business whenever possible.

Revenue CLVTotal expected customer revenue over the relationship.

Gross-profit CLVExpected revenue less direct cost of delivering it.

Net valueGross-profit customer value after acquisition cost.