In marketing, the CLV is one of the key metrics to have and monitor. The CLV measures customers' total worth to the business over the course of their lifetime relationship with the company. This metric is especially important to keep track of for acquiring new customers. It is generally more expensive to acquire new customers than to keep existing customers, so knowing the lifetime value and the costs associated with acquiring new customers is essential in order to build marketing strategies with a positive ROI. For example, if the average CLV of your customer is $100 and it only costs $10 to acquire a new customer, then your business will be generating more revenue as you acquire new customers.
However, if it costs $150 to acquire a new customer and the average CLV of your customer is still $100, then you will be losing money for each acquisition. Simply put, if your...
