LTV Calculator
Most store owners calculate their profit from the first order only. This tool calculates total customer value (LTV) from average order value × number of purchases × margin, and compares it to your customer acquisition cost, so you know what this customer really earns you over their whole relationship with you.
AOV × number of purchases—
After margin: net profit from the customer—
LTV minus CAC—
The higher it is, the more you can pay for new ads—
The math assumes margin stays fixed on all future orders from the same customer. In reality the second sale usually has a higher margin because its ad cost is close to zero, so treat this number as a minimum estimate.
How to read the result
Total revenue per customer is all the money a customer will pay you across their whole relationship with you, before any cost is deducted. True customer value (LTV) is that same figure after applying your margin, meaning the actual profit that reaches you from this customer, not just revenue. The gap between the two is the same gap between revenue and profit explained in getting orders and losing money: how to calculate your real profit.
If you enter your customer acquisition cost (CAC), the tool subtracts it from LTV to show your net profit after acquisition. If that number is negative, you are paying more to acquire a customer than they will return, even counting all their future purchases. This usually happens when you calculate CAC on the first order alone without knowing how to measure it properly, as explained in how to read your media buyer's report.
Where does the number of purchases come from?
This number is not a guess. It comes directly from your Returning Customer Rate. The topic is covered in detail in retention: how to get customers buying again without ads, with real numbers from real accounts: a coffee store reached 54.08% Returning in a single month, and a fitness store reached 56.67% over 4 months. The higher your rate, the higher your expected number of purchases, and the more your LTV grows without spending anything extra on ads. The full breakdown is in the game is LTV, not CPP.
Where does the profit margin come from?
Use the real profit calculator first to find your profit in EGP per order after product cost, shipping and delivery rate, then divide it by the selling price to get the percentage to enter here. If your delivery rate is low because of a lot of returns, see why orders get returned in Egypt before you calculate the margin, because the number will change a lot once you improve it.
Growing LTV is not only about retention. Raising the average order value itself multiplies the effect, which is covered in raising average order value (AOV) and selling with an offer, not a discount. The selling-with-an-offer case study raised AOV to 79.91 dollars and reached 40.66% retention at the same time, the same principle this tool measures. If you want to know whether your current ad budget is really the fix, read why raising your ad budget is not always the answer.
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