Now let’s see how Sergio uses CLV to help him convert potential customers. Sergio realized that he could use his 1,250 Euro CLV to evaluate which of his marketing efforts are most effective in attracting new customers. Currently, his advertising budget is evenly divided among these three channels: billboards near the start-up company’s office, mobile advertising for company owners, and search engine marketing for business keywords and businessmen. To find out which is more suitable for him, Sergio calculated the CLV of each advertising channel. He first grouped current customers according to the channels through which they found the company. Then, he uses a reliable formula to calculate the CLV of each customer group, which then becomes the CLV of that marketing channel.


business management

customer lifetime value calculation

growth hacking