Understanding the Lifetime Metrics Analytics View

The Lifetime Metrics drill down in your Analytics Overview measures customer Life Time Value (LTV) and Life Time Revenue (LTR). This is the amount of revenue you can expect per customer, and overall for your business.

Understanding Lifetime Averages

The metrics displayed in Lifetime Metrics are averages. They represent all customers as a singular group, regardless of activity, subscriber status (active or churned), spending amount, or other factors.

For a more specific breakdown of lifetime analytics, consider focusing on particular subscriber segments:

• Subscriber Status: Active or Churned. Active customers will, on average, have higher LTV and LTR
• Amount Spent: Group subscribers into revenue tiers based on how they compare to the average LTR
• Time (Sign Up Date): Filter revenue by including only data after a specific date. LTR will vary based on the time elapsed since subscriber sign-up

Calculating LTR and LTV

The Lifetime Metrics analytics tab gives you an estimate of revenue to expect per customer. We provide that information through Lifetime Value and Lifetime Revenue:

Lifetime Revenue

The total amount of revenue generated from a customer over their entire relationship with your business. This includes all transactions such as initial purchases and recurring subscription payments, and any additional upsells or add-ons. We do not include any costs when calculating LTR.

Calculated by:

LTR = Amount of Revenue (over a specific period) / # of Customers

Example Calculation:

• Over a two year period from 1/1/2022 to 12/31/2024
• $150,000,000 in total revenue
• 185,000 total subscribers during that time period
• Average LTR = $150,000,000 / 185,000 = $810.81

Or for an individual subscriber:

LTR = Average spend per order * Number of orders

Example Individual Calculation:

• Average spend per order: $50
• Number of orders: 6
• LTR = $50 * 6 = $300

Lifetime Value

The total value a customer will contribute to your business over their entire lifespan as a customer. LTV factors in not just revenue but also costs, such as customer acquisition and retention expenses, to help your business understand the long-term profitability of a customer.

Calculated by:

LTV = The amount of profit (revenue - cost of goods sold) over a specific timeframe* / # of customers

*You can filter Profit by particular groups of customers based on additional criteria like specific products subscribed to. These groups act as cohorts of customers, and you can compare the cohorts.

Example Calculation:

Let’s look at the same example we used for LTR, but factor in costs now:

• Over a two year period from 1/1/2022 to 12/31/2024
• $150,000,000 in total revenue including expenses during the time period
• $50,000,000 in total expenses during the time period, for cost of goods sold and shipping
• 185,000 total subscribers during that time period
• LTV = ($150,000,000 - $50,000,000) / 185,000 = $540.54

For an individual customer:

LTV = (Average spend per order - cost of goods and shipping) * number of orders

Example Individual Calculation:

• Average spend per order: $50
• Total order cost (including cost of goods sold and shipping): $20
• Number of orders: 6
• LTV = ($50 - $20) * 6 = $180

1 - Key Lifetime Metrics

The Lifetime Metrics widget displays two high-level metrics:

1. Lifetime Value: The predicted total value a customer will contribute to your business over their entire lifespan as a customer, minus costs of goods sold.
2. Lifetime Revenue: The total amount of revenue generated from a customer over their entire relationship with your business.

2 - Lifetime Value Chart

Tracks how your subscription program’s average Lifetime Value (LTV) changes over time.

3 - Lifetime Revenue Chart

Tracks how your subscription program’s average Lifetime Revenue (LTV) changes over time.

4 - LTV Distributed by Revenue Tier

Shows the distribution of subscribers across different lifetime revenue tiers and their average LTR. We include the chart and the data breakdown in a chart beneath.

The chart is split by:

• Active customers: Customers who have at least 1 active subscription with your store. We include a total up to the current point in their lifetime, but they will spend more.
• Churned customers: Customers whose lifetime is complete, they have no active subscriptions. They will not contribute to any additional revenue unless they reactive and return to your program.