Definitions and Glossary
Customer Lifetime Value

The net present value of a customer based on his or her projected future relationships with an organisation. This measure is regarded as a more accurate method of understanding a customer’s true value to the organisation than current profit.

The customer lifetime value can be difficult to determine because its value will depend on how long a customer stays with your organisation and what they purchase from you. However, the free Genroe Return on Retention tool provides a good initial estimate.