Customer Lifetime Value Formula: How to Calculate CLV for SaaS

Customer lifetime value (CLV or LTV) is the total revenue a business expects from a single customer over their entire relationship. The standard customer lifetime value formula for SaaS is ARPA multiplied by gross margin multiplied by average customer lifespan. Learn three CLV calculation methods, understand what LTV means in business, and see how to use the LTV:CAC ratio to evaluate your unit economics.

Topics covered

• customer lifetime value formula
• calculate ltv formula
• what is ltv in business
• LTV CAC ratio
• CLV SaaS