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Customer lifetime value calculator

Lifetime profit per customer and your max CAC.

Quick answer

LTV = order value × orders per year × years × margin. A 41 € order, 3 times a year for 2 years at 40% margin is 99 € of profit; at 3:1, pay up to 33 € per customer.

Start from an example:

Customer

$
orders
years
%
Share of each order left after product, shipping and fees.

Compare (optional)

$
Ad spend ÷ new customers. Leave 0 to skip.

A simple model. It assumes steady order value and retention and does not discount future profit.

How customer lifetime value is calculated

  • Revenue LTV

    order value × orders per year × years

    Total a typical customer spends with you.

  • Profit LTV

    revenue LTV × gross margin

    What that customer is really worth after product and fulfillment costs. Use this one for ad budgets.

  • Max CAC

    profit LTV ÷ 3

    A common rule of thumb is to earn 3× what you pay to get a customer, leaving room for overhead and profit.

Frequently asked questions

What is a good LTV to CAC ratio?

3:1 is a common target. Below 1:1 you lose money per customer; far above 5:1 you may be underspending on growth.

How do I find years as a customer?

Use your repeat data. A rough guide is 1 ÷ yearly churn rate; 50% churn a year means about 2 years.

Should LTV use revenue or profit?

Profit. Revenue LTV looks bigger but does not tell you how much you can afford to spend on ads.

Related free tools

→ROI calculatorReturn on investment and annualized ROI.→Conversion rate calculatorYour conversion rate and the traffic you need.→TikTok Shop profit calculatorProfit per order after every fee.
Updated ·By the Deviantly data team