Customer Lifetime Value (CLV) calculator

How It Works:

1. Inputs:
   • Average Purchase Value ($): The average amount spent by a customer per transaction.
   • Purchase Frequency (per year): How often a customer makes a purchase in a year.
   • Customer Lifespan: The average duration a customer continues to buy from your business, selectable in years or months.
   • Average Gross Margin per Purchase (%): The average gross margin made from each sale as a percentage.
2. Process: The calculator takes these inputs and calculates the Customer Lifetime Value (CLV) both as a revenue figure and as a profit margin over the customer’s lifespan. The option to switch between years and months for the customer lifespan provides flexibility, and including the gross margin offers deeper insight into the profitability of customer relationships.
3. Output: Displays the CLV and the total profit margin over the customer’s lifespan, providing a comprehensive view of the value a customer brings to the business.