LTV is the total profit a customer generates over their relationship with the business — the number that determines what you can actually afford to pay to acquire them.
Definition
LTV models future revenue (repeat purchases, subscription duration, expansion) net of costs, usually segmented by cohort, product, or acquisition channel. Paired with CPA it becomes the governing ratio of paid acquisition: LTV:CAC. A channel with a high CPA and high-LTV customers can beat a cheap channel that acquires one-and-done buyers.
Why it matters
First-purchase metrics systematically misprice acquisition. Channels and audiences differ in the quality of customers they deliver, not just the cost — and only LTV exposes that. Feeding LTV or predicted-value signals into bidding is how the difference becomes operational rather than a slide in a quarterly review.
In agentic execution
Adlyse's agents can execute toward value-weighted goals — adjusting targets and value rules as LTV data matures — so acquisition chases the customers worth having, with humans approving each change.
Related terms
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