The advantage of using CLTV

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The customer lifetime value is a forecast of the amount of money the company expects to receive from a user, for as long as the user remains its customer. In business, it is not enough to say that time is worth money . It is necessary to quantify as precisely as possible the monetary value that a consumer represents for the company while a commercial relationship exists. For example , are you a Netflix user ? So your customer lifetime value is the projection that Netflix makes to try to predict how long you will remain a subscriber and how much money you will spend in the company from the moment you subscribe to the moment you abandon the subscription.

The CLTV is the value of income that a customer generates while maintaining a satisfactory Cambodia WhatsApp Number Data commercial relationship with the brand in a period of analysis. So, the CLTV is nothing more than the value that you manage to obtain from each customer throughout their life linked to your product/service, understanding value as margin (gross margin for example) and the customer's life as recurrence (the number of times that buys you).  is that it allows us to know which are the most valuable customers for our company or business, this being the main function of this metric, as its name indicates.



Knowing who our most valuable customers are allows us to have a diverse relationship with them and allows us to use different loyalty methods . Another advantage is that CLTV can help us find user profiles likely to generate more income for our brand. By directing our efforts to this new identified segment, it is possible that we will increase our profits since we will find clients that generate greater income for us over time. We can also use this metric to improve our customer acquisition budget. 3 Types of CLTV and their formulas