LTV
🚀AdvancedLTV (Customer Lifetime Value) is the total revenue a customer generates over their entire period as an active customer — not just the first order.
Aliases: Customer Lifetime Value · Životna vrednost kupca
What it is
LTV (Customer Lifetime Value) is the total revenue a customer generates over their whole active period, not just their first order. Once you know LTV, customer acquisition cost (CPA) can deliberately run higher than the profit on that first order, because the difference gets recovered through repeat purchases.
My take
In accounts with repeat purchases, I don't kill a campaign the moment CPA passes the price of the first order - I look at whether that order repeats, because that changes how much acquisition is allowed to cost.
Example
A customer whose first order is $50 but who returns and spends $300 total over the year has an LTV of $300 - that justifies an acquisition CPA of $80, even though the first order alone wouldn't cover it.
Read in depth
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