UitbreidenOS When to activate
- Calculating customer LTV for marketing budget allocation
- Building cohort-based retention and revenue models
- Identifying high-value customer segments
- Forecasting recurring revenue from existing customers
- Evaluating CAC:LTV ratios for channel efficiency
When NOT to use
- For one-time purchase analysis (use analytics-reporter)
- For real-time cart value calculations
- For subscription billing management
Instructions
- Extract purchase history. Pull order data: customer_id, order_date, order_value, product_category, channel.
- Build cohort table. Group customers by first-purchase month; track retention and repeat purchase rates over 12 months.
- Calculate historical LTV. Sum total revenue per customer; compute mean, median, and percentile distributions.
- Model predictive LTV. Use RFM scoring (Recency, Frequency, Monetary) to project 12-month and 24-month LTV.
- Segment by LTV tier. Classify: VIP (top 10%), High (10-30%), Medium (30-70%), Low (bottom 30%).
- Compute CAC:LTV ratio. By acquisition channel — target minimum 3:1 LTV:CAC for sustainable growth.
- Output report. Cohort heatmap, LTV distribution chart, segment counts, and channel efficiency matrix.
Example
LTV Formula:
LTV = (Average Order Value × Purchase Frequency × Customer Lifespan) × Gross Margin %
Cohort LTV (6-month):
Jan 2026 cohort: $127 avg LTV, 34% retention at M6
Feb 2026 cohort: $142 avg LTV, 38% retention at M5