Customer Lifetime Value (CLV) is a formula used to quantify the long-term benefits of keeping a customer. The formula takes into consideration the customer’s profitability, retention and engagement over time. By calculating CLV, businesses gain insight into how much money they can afford to spend on marketing campaigns, customer acquisition and other activities that generate customer loyalty and satisfaction. Ultimately, understanding your customers’ lifetime value helps you make decisions that will result in higher sales and greater profits.