Customer Lifetime Value (LTV) Calculator
Customer Lifetime Value (LTV or CLV) estimates the total revenue a business can expect from a single customer over the entire duration of the relationship. Enter the average purchase value, purchase frequency (per year), and average customer lifespan (in years), and this calculator shows your LTV.
LTV is calculated as Average Purchase Value x Purchase Frequency x Customer Lifespan. It's one of the most important metrics in business because it tells you how much you can afford to spend acquiring a customer (your CAC ceiling) and which customer segments are most valuable to invest in retaining.
Everything runs in your browser — no data is sent anywhere.
By The Paper Room Editorial Team — Calculators
Frequently asked questions
What inputs do I need for LTV?▼
You need three numbers: the average amount a customer spends per purchase, how many times per year they purchase, and how many years they remain a customer on average. For a subscription business, the 'purchase' is a subscription payment (monthly or annual) and frequency matches the billing cycle.
What's a good LTV:CAC ratio?▼
A commonly cited benchmark is 3:1 — your customer lifetime value should be at least three times your customer acquisition cost. Below 1:1 means you're losing money on every customer. Above 5:1 may mean you're under-investing in growth and could afford to spend more on acquisition.
Is this the same as discounted LTV?▼
No — this is a simple LTV calculation that doesn't account for the time value of money. A more sophisticated model would discount future revenue using a discount rate (net present value), which gives a lower but more financially accurate figure. This simple version is sufficient for benchmarking and comparisons.