EStore Tools

Customer Lifetime Value Calculator

Get a margin-based CLV, built from profit per order rather than revenue, and compare it with what you spend to acquire a customer.

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Your numbers

Per-order numbers
$

Price minus product cost, as a share of price. This is what makes it a margin-based CLV, not a revenue-based one.

%
How long customers stay
Compare to acquisition cost

Ad spend and other marketing cost to win one new customer. Leave at 0 to skip the ratio.

$

Your result · updates as you type

Customer lifetime value

$281

$29.25 profit per order × 3.2 orders/year × 3 years.

Profit per order
$29.25
Profit per customer per year
$93.60
LTV : CAC ratio
6.2×

This is margin-based CLV: it already accounts for product cost, so it's the number to compare against acquisition cost, not revenue-based CLV.

Breakdown

Average order value
$65.00
Gross margin
45%
Profit per order
$29.25
Orders per year
3.2
Years active
3
Customer lifetime value
$280.80
Customer acquisition cost
$45.00
LTV : CAC
6.24×

Why margin, not revenue

A lot of CLV calculators multiply revenue by lifespan and stop there, which overstates what a customer is actually worth: revenue still has to pay for product cost. This one starts from gross margin, so the result is directly comparable to what you spend to acquire a customer.

Customer lifetime value = average order value × gross margin × orders per year × years active

Example: the default numbers

Average order value
$65
Gross margin
45%
Orders per year
3.2
Years active
3

Profit per order is $65 × 45% = $29.25. Lifetime value is $29.25 × 3.2 × 3 = $280.80. Against a $45 acquisition cost, that's a 6.24× LTV:CAC ratio.

Using LTV:CAC

  • A ratio above 3:1 is a commonly cited rule of thumb for a healthy acquisition channel, leaving room for overhead beyond marketing spend. It's a rough guide, not a rule everyone agrees on.
  • If you don't know your average customer lifespan, switch to the churn-rate mode: lifespan is estimated as 1 ÷ annual churn rate.
  • Recalculate by channel if you can: a customer from an organic search result often behaves very differently from one who arrived through a discount-led paid ad.

Questions people ask

What's the difference between margin-based and revenue-based CLV?

Revenue-based CLV multiplies revenue by lifespan and ignores product cost, which overstates value. Margin-based CLV (this tool) starts from profit per order, so it's the number to compare directly against acquisition cost.

What's a good LTV:CAC ratio?

3:1 or higher is a commonly cited rule of thumb, leaving room for overhead beyond raw marketing spend. Treat it as a guide, not a hard rule, since it varies by business model and how CAC is measured.

How do I estimate customer lifespan?

If you don't track it directly, use 1 divided by your annual churn rate. A 25% annual churn rate implies an average 4-year lifespan.

Should CLV include shipping and payment fees?

Build them into your gross margin figure before entering it here, so the margin represents what's actually left after every per-order cost, not just product cost.

Related tools

Referral Program CalculatorFind the largest reward you can afford to pay per referred customer, based on what that customer is worth over their lifetime.Loyalty Program ROI CalculatorCompare the extra profit from members buying more often against the real cost of the points and the program itself.Repeat Purchase Rate CalculatorSee what share of your customers bought more than once, and track it against your own history over time.Subscription Revenue CalculatorProject your monthly recurring revenue forward from today's subscribers, signups, churn and skipped orders.

Want this builtinto your store?

I'm Emmanuel, a Shopify and WooCommerce developer. If this tool pointed at something you'd rather have fixed for you (a faster store, cleaner product data, a migration, a custom feature), send me a note.

Emmanuel Asika

Emmanuel Asika

Shopify & WooCommerce developer, Dublin

I build and fix online stores: new builds, migrations, speed, SEO and the custom bits apps can't do.

hello@emmanuelasika.com
See my work

Last reviewed 30 September 2026.