You know it’s easier to sell to an existing client than to acquire a new one. For this reason, you want to ensure that your clients are satisfied with your products or services so that you can keep them long enough to recoup your initial investment in earning their business.
Below is a fundamental client lifetime value calculator that you can use to calculate your clients’ lifetime value.
Start by entering:
- Your the average billing cost for your services
- How many sales do you make a year on average
- How many years do you retain that client on average
- How many referrals do you get from your clients on average
- What percentage do you convert your referrals?
Amount of Average Sale
$
Number of Sales per Year
Number of Years a Client
Additional Client Referrals per Year
Percentage of Referral Conversion
%
Gross Sales per Year
$
Gross Sales Over Lifetime
$
New Clients Annually From Referrals
Lifetime Sales From Referrals
$
Total Lifetime Valuse of a Client
$