Lifetime value

Lifetime value, or LTV, is an estimate of the average revenue a customer will generate over the time that they use a given product or service.

What is LTV?

Lifetime value, or LTV for short, is a core metric in mobile business growth, often used to determine how valuable a user is over the span of time that they’re using an app. 

LTV helps marketers properly optimize revenue streams like in-app purchases, in-app advertising, and subscriptions, by pinpointing exactly how much money they can afford to spend on user acquisition while remaining profitable.

LTV vs CLV

You may also have heard the term CLV, or customer lifetime value, and be wondering how it differs from LTV.

In truth, the two metrics are very similar, and in some companies the terms are used interchangeably. 

If you want to get technical about it, though, it’s generally agreed that CLV measures the value an individual customer will bring over the time they spend with you, whereas LTV looks at the average value across your entire customer base. 

What about ARPU?

ARPU — average revenue per user

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