Glossary · Sales efficiency
Lifetime value (LTV)
How much gross profit a typical customer brings over their whole relationship with you. It answers whether spending to acquire them makes sense.
Related: Customer acquisition cost (CAC) · Churn rate · Monthly recurring revenue (MRR) · LTV:CAC ratio
A bit more nuance▾
- LTV models assume retention curves — stress-test them.
- Early customers may behave differently than later ones.
Go deeper▾
Discussion questions▾
- What event ends a customer’s “lifetime” for you?
- How would LTV change if your biggest segment doubled?
Educational reference only — not legal, tax, or investment advice. Terms vary by country and deal; ask a qualified professional when it matters.