lifetime-value

Vocabulary Word

Definition

'Lifetime Value' commonly known as 'Customer Lifetime Value' or 'CLTV', is a prediction of the total revenue a business can expect from a single customer account. It calculates the monetary value of a customer relationship.

Examples in Different Contexts

In nonprofit organizations, 'lifetime-value' of donors helps plan future projects. A fundraiser might share, 'Our recent campaigns have boosted the LTV of our supporters, allowing more impactful initiatives.'

Practice Scenarios

E-commerce

Scenario:

Our sales figures are impressive. However, I wonder if there's a way for us to retain customers for a longer period?

Response:

By curating personalized shopping experiences, we could potentially enhance the lifetime value of our customers.

Marketing

Scenario:

Our marketing campaigns are bringing in a lot of new customers. Should we now shift focus to strengthening our relationships with existing customers?

Response:

Yes, investing in customer relationship management could help increase customers' lifetime value.