LTV by Customer measures the average amount of profit earned per customer, throughout the entirety of their time as a customer. The columns in this dataset represent n+ months since the customer placed their first order. This is a cumulative metric.
LTV = Net Sales - Costs
(Net Sales = Gross Sales - Refunds - Discounts)
Lifetime value is an essential metric that helps you to optimize your marketing budget and set goals regarding your customer acquisition costs. It is the predicted net profit you can expect from any given customer over the course of your business relationship.
More info on Customer Lifetime Value can be found here
Updated 2 months ago