The actual commercial value of any customer is always determined by the aggregate of purchases made over their lifetime. An indicator like this presents the companies with an information-driven approach to acquiring and retaining customers based on their lifetime value.
Customer Lifetime Value (CLV or CLTV) is the critical metric in determining marketing strategies based on different categories of data obtained for each customer. Hence, CLV is a decision-making key indicator for companies for any upfront investment. When compared with customer acquisition/retention cost, customer lifetime value gives an actual profitability depiction. The envisaged strategies are then opted to get optimum results from the market.