Customer Lifetime Value (CLV) Analysis is an important tool for businesses to measure and predict the revenue that a customer will generate over the course of their relationship with the company. By understanding how much a customer is expected to spend, companies can make better decisions about where to invest resources and allocate marketing budget. CLV works by considering factors such as customer purchases, product costs, loyalty scheme usage, utilization of services and other key metrics to put a value on each customer. With this approach, companies can evaluate which customers are worth cultivating and determine strategies to further increase their lifetime value.