Value Throughout Customer Lifetime
Estimate contribution from recurring customer relationship wey remain stable.
Your numbers
Lifetime contribution value before discounting
E assume constant churn and margin, no expansion and no discounting. Small churn changes fit cause big value changes.
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Formula
Use LTV = Rm/c−S. R na monthly revenue per customer, m na contribution-margin fraction, c na monthly churn fraction, and S na one-time servicing cost. Constant churn give expected lifetime of 1/c months; this model no discount future contributions.
Estimate contribution from recurring customer relationship wey remain stable.
Example wey show the calculation
- Revenue from each customer every month
- 50
- Margin wey remain for contribution (%)
- 60
- Customers wey leave every month (%)
- 5
- Cost to serve customer just once
- 0
- Lifetime contribution value before discounting
- 600
- How long customer fit stay on average
- 20 months
Where e fit work and limits
E assume constant churn and margin, no expansion and no discounting. Small churn changes fit cause big value changes.
We check inputs for missing values and allowed ranges. Result wey pass the finite numeric range no go show. Rounding affect wetin display, while calculation use the model numeric precision.
Check your units and assumptions before you rely on result. Changing label no convert currency or physical unit.
Version of di formula: 09c3b081862a · Example don get check: