Lifetime value refers to the total worth or value that a customer brings to a business over the course of their entire relationship with that business. It takes into account not only the initial purchase or transaction, but also the potential for future purchases and the overall impact on the company’s bottom line. This metric is crucial for businesses to understand and track, as it helps them determine the effectiveness of their marketing and customer retention strategies. A high lifetime value indicates a strong and loyal customer base, while a low lifetime value may signal the need for improvement in customer satisfaction and retention efforts. Ultimately, the lifetime value of a customer is a key factor in the long-term success and growth of a business.