# Customer lifetime value (CLV) calculator for shops

Order value, orders a year, years as a customer and margin in; lifetime revenue, lifetime profit and the most you can spend to win a customer out.

Source: https://webkodingtheme.com/tools/customer-lifetime-value-calculator/

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Free tool

# Customer lifetime value calculator

How much a customer is worth over the whole relationship, in revenue and in profit — and so what you can afford to spend to win one.

Average order value (USD) Orders per year Years as a customer Gross margin (%) Currency USD EUR GBP CAD AUD TRY INR AED SAR
Lifetime profit US$180.00
Lifetime revenue US$360.00
Max acquisition cost at 3:1 US$60.00

## How it is calculated

Lifetime revenue = average order value × orders per year × years.
Lifetime profit = lifetime revenue × gross margin.
The 3:1 rule of thumb keeps the cost of winning a customer at no more than a third of their lifetime profit, leaving room for overheads.

## Questions

### How do I find my own numbers?

From your order history: average order value is revenue ÷ orders; orders per year is orders ÷ unique customers over a year. Years as a customer is the hardest — if unsure, use 1 and treat anything more as upside.

### Why use profit, not revenue?

Because you pay for acquisition out of profit. A $300 lifetime revenue on a 20% margin justifies far less ad spend than the same revenue on 60%.

### How can I raise lifetime value?

Bring customers back: follow-up emails, a reason to reorder, a loyalty offer that costs less than acquiring someone new. Small changes to orders per year compound across every customer.

## If you run WooCommerce

WooFinance reports profit per order in WooCommerce, which is the figure lifetime value should be built from. WooFinance is our plugin; the calculator above works the same whether you use it or not.

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