Free Tool for Calculating Customer Lifetime Value (LTV)
This spreadsheet based tool will help you calculate Lifetime Value of your customer base. Submit the form on the left to be sent the Excel workbook.
As the screengrab shows, you will be expected to enter
- the number of customers you acquired in Year 1 and how many of them returned in Years 2, 3, ... onwards to make purchases
- the revenues this baseline population delivered year over year.
- the costs figures (marketing, cost of acquisition, etc) entered as % of revenues.
The output will be the average lifetime value of your customer base per segment and overall.
How to use the LTV
- Build the business case for acquisition campaigns.
- Assess the cost of customer attrition.
- Build business case for retention campaigns.
- Build product strategy across multiple products/brands (What's the value of acquiring customers on Product A versus Product B?)