CLV (Customer Lifetime Value)

Also known as: Customer Lifetime Value, LTV, Customer Value

Total economic value a customer will generate for a company over the entire course of their commercial relationship.

Customer Lifetime Value (CLV or LTV) is the total net economic value a customer will generate for a company over their entire commercial relationship. It is one of the most important KPIs in customer-centric marketing because it allows prioritizing acquisition and retention based on long-term profitability.

Simplified formula: CLV = (Average purchase value × Purchase frequency) × Relationship duration - Acquisition and retention costs.

In market research, CLV informs segmentation decisions (prioritize high-CLV segments), product decisions (what features increase retention), and pricing decisions (what price maximizes CLV without sacrificing volume).

Atlantia integrates CLV estimates in its segmentation analyses to identify the most valuable segments for its clients.