LTV (Lifetime Value)
Total revenue a customer generates over their lifetime.
LTV (sometimes CLV / Customer Lifetime Value) is the total gross profit a customer is expected to generate during their entire relationship with you. For a one-time-purchase business, LTV ≈ AOV × margin. For subscription or repeat-purchase businesses, LTV = AOV × margin × purchase frequency × retention.
LTV is the ceiling for how much you can pay to acquire a customer. Most MENA e-commerce dropshipping has LTV ≈ AOV × margin because repeat rate is under 10%. Repeat-driven businesses (cosmetics, supplements) can hit 35–50% repeat, dramatically raising LTV and allowable CAC.