Skip to content
Back to glossary

Glossary

LTV (Life Time Value)

LTV measures the total value a customer generates throughout their entire relationship with your company.

KPIkundvärdeSaaS

Life Time Value (LTV) is the total value of a customer over their entire relationship with your company. Instead of using only one transaction for ROI calculations, you calculate the sum of all transactions the customer completes.

Why is LTV important?

LTV helps you understand how much you can invest in acquiring new customers. A common rule of thumb is that the LTV:CAC ratio should be at least 3:1 for a sustainable business model.