Customer Lifetime Value
- Social Sciences -
Economics & Business Dictionary
Definition
A strategy and growth concept defining how an organization targets customers and competes to generate sustainable revenue. It specifies choices about value proposition, channels, pricing, and customer management that shape demand and retention. It does not ensure growth without product-market fit, rigorous execution, and measurement of leading indicators.
Customer Lifetime Value
Social Sciences Dictionary
Definition
The present‑value estimate of the total future net profit a firm expects to derive from its relationship with a customer, calculated over an explicit horizon and using a specified discount rate; net profit here typically means contribution margin less incremental servicing and retention costs (acquisition cost may be included or excluded by convention).