Customer lifetime value is sometimes referred to as lifetime customer value or life time value. In terms of marketing to customers it is important to understand the potential that exists for the customer to make future, further purchases and to what extent this might develop. The lifetime value of the customer is different depending on the type of products on offer. It can also be defined as the monetary value of a customer relationship.
The lifetime value of the customer is directly proportionate to the amount of marketing a company will spend money on to get future business from that customer. The reason the lifetime value is considered is to allow for rationale behind the marketing mix.