Increase the customer lifetime value

Business Benefits

Improve customer experience and increase your income stream.


Segment your current customers by their behavior, demographics, or business model.

For example, if you run a gym and want to know the lifetime value of your members, you’d have to consider the customer segments that:

  • Pay for personal training and group coaching
  • Buy supplements
  • Pay for additional classes
  • Buy t-shirts, gear or refreshments.

Calculate your current customer lifetime value for each segment.

For a basic calculation, use this equation:

(Average value of a sale) X (Number of repeat transactions) X (Average retention time in months or years)

Identify high-value customers and demographics, and concentrate on marketing to them.

These are your customer segments with the highest customer lifetime value. For example:

  • IBM increased revenue by 10x by correctly identifying and marketing to high spending customers.
  • SurveyMonkey increased LTV by 150% by identifying its most profitable geo-demographics.
  • HubSpot reduced churn by 57% and increased LTV by 215.72% in a year and a half.

Use email to answer common questions in advance, upsell, and provide customer education.

Cross-market and provide lead generation for companies with similar customer bases.

View every customer interaction as an opportunity to improve customer loyalty.

Find ways to build habits around your product.

Make customer service easy to access and interact with.

According to Harris Interactive, 56% of customers will switch brands if the alternative offers more ways to connect.

Incorporate customer feedback to improve everything from user experience to product features and design.