Customer Lifetime Value (CLV) is the dollar value of a customer relationship based on the present value of the projected future cash flows from the customer. Focusing on CLV shifts the focus from quarterly to the long-term health of customer relationships. CLV = margin ($) *(retention rate (%) / [1 + discount rate (%) - retention rate (%)]). The components of CLV work together to create the best customers for your business. Retention rate, discount rate, and margins are good metrics to track.

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Customer value, projecting future cash flows, relationships rule