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Digital Marketing
Customer lifetime value is the total revenue a business expects from one customer over the whole relationship, not just the first purchase.
A simple estimate multiplies average order value by how often a customer buys and how long they stay. Subscription and repeat-purchase businesses rely on it heavily.
Comparing lifetime value with the cost of acquiring a customer shows whether growth is sustainable.
Example
A client on a monthly SEO retainer pays PKR 80,000 a month and stays 18 months on average, a lifetime value of PKR 1,440,000.
Why it matters
When lifetime value is high, you can afford a higher CPA to win each customer, which lets you outbid competitors who only look at the first sale.
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Digital Marketing
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