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13 January 2025

Customer Lifetime Value (CLV) (Glossary)

iROI Digital Marketing Automation Digital transformation eCommerce and digital commerce Sanjay Sauldie Glossary

The term Customer Lifetime Value (CLV) is particularly at home in the fields of eCommerce and digital commerce, digital marketing and digital transformation. It describes the estimated total value that a customer brings to a company throughout the entire business relationship.

In practical terms, this means that customer lifetime value provides information on how much a customer spends on products or services on average over time. Companies use this figure to better plan how much they should spend on acquiring and supporting a customer. If the CLV is high, it is usually worth investing more in customer loyalty.

An illustrative example: an online shop recognises that regular customers spend an average of 300 euros per year and stay for an average of 5 years. The customer lifetime value is then 1,500 euros. This helps the company to optimise its marketing and service costs.

To summarise: Customer Lifetime Value (CLV) is an important tool for determining the long-term value of a customer and building successful customer relationships in a targeted manner.

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Sanjay Sauldie

Sanjay Sauldie is a digital strategist, speaker and developer of the transruption toolkit, which companies can use to make their digital transformation measurable, human and sustainable. With kiROI - the AI-based approach to value creation in the digital age - he helps self-employed people and companies to integrate artificial intelligence into their processes in a practical way. With his outstanding marketing strategy iROI, he has already led countless companies to greater visibility and thus more profits. He combines digital innovation with disruptive thinking models for a sustainable business strategy. He studied mathematics and computer science at the University of Cologne, completed a Master of Science in Digital Disruption at the University of Salford (UK) and a Design Thinking programme at MIT/EMERITUS Singapore. As a multiple award-winning expert - including the Golden Web Award and the Innovation Award of the Initiative Mittelstand - he advises SMEs and corporations. His motto: "Digitalisation is not an end in itself - it must serve people."

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