Average Customer Lifetime Value (ACLV) is a metric used in subscription businesses to estimate the total revenue a business can expect to receive from an average customer over the course of their relationship with the business. ACLV is a key metric that helps businesses to evaluate the long-term value of their customer relationships and inform decisions around customer acquisition and retention.
Average CLV takes into account the average lifespan of a customer with the business, as well as the revenue generated from that customer during that time period, minus the costs associated with acquiring and servicing that customer.
ACLV helps businesses with subscription and billing management to make data-driven decisions around pricing, marketing, and customer retention. By focusing on increasing ACLV, businesses can improve their profitability and build stronger customer relationships. Additionally, ACLV can be used to identify high-value customers and tailor marketing and retention strategies to meet their unique needs.