Observation and definition of the question Although, often over quoted, the term LTV (Life Time Value) is one of the most underutilized but fundamental marketing concepts.. The concept is ( see Customer Equity - ) based on the belief that the customer is the unit value for an enterprise and the sum total of customer value [...]
Category Archives: Lifetime Value
LTV is a neat concept, and extensively written and talked about by the buzzword consultants and academia, but actually calculating it and using in marketing is very hard and impractical. First of all, the future value of a customer is very much dependent on the marketing spend for that customer. So this is the biggest [...]
LTV is defined as expected profits (gross margin minus direct costs) from customers over their lifetime, discounted with WACC, adjusted by subtracting the acquisition cost of customers.