Lifetime Value (LTV)

Estimate total revenue from a customer over their lifecycle.

Product Management
IH InterviewHood
Definition

LTV is the total expected revenue from a customer over their relationship with the product.

Definition

LTV is the total expected revenue from a customer over their relationship with the product.

Lifetime Value (LTV) estimates the average revenue a customer generates before churning. It helps quantify customer value and guides marketing, pricing, and retention strategies. PMs and marketers use LTV to determine how much to invest in acquiring and retaining users for profitability.

A high LTV indicates long-term product value and user satisfaction.

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