Click here to access the CLV and retention metrics calculator

One dashboard that tracks all your retention metrics

After how long without purchasing can a customer be considered lost forever? What’s your customer lifetime value? Most e-commerce retailers don’t know because the calculations related to these metrics are both complex and time-consuming. That’s why we’ve created a 1-click CLV and retention metrics calculator that measures all of this and more.

There are four main areas of retention addressed:

  1. Customer Lifetime Value (CLV)
  2. Churn (Customers leaving)
  3. Average Order Value
  4. Purchase Frequency

Each area has three sections.

1. Customer Lifetime value calculation

CLV/CLTV

  • The total value of a customer to a store over the entire duration of his or her relationship with the store.
  • Unit of measure: Dollars
  • Interpretation: Arguably the most power metric in e-retail, this metric, when combined with the store’s margin, can inform the retailer of how sustainable his or her business model is, how much to pay to acquire customers, and how to allocate resources. Learn more about customer lifetime value and how to use it to improve your marketing efforts.

CLV (non-repeat customers)

  • The average dollar value of orders from customers who only make a single purchase from the store.
  • Unit of measure: Dollars

CLV (repeat customers)

  • The total dollar value of customers, who have made two or more purchases from the store.
  • Unit of measure: Dollars

2. Churn (customer leaving) calculation

Churned customers

  • Churned customer are customers who have purchased from the store but are not expected to purchase again. The period after which a customer is defined as churned is determined by that customer’s personal buying patterns. If there is insufficient data on a customer the store average is used.
  • Unit of measure: Number of customers

Hope threshold

  • If a customer has not made a purchase within this period of time there is less than a 5% chance of he or she is buying from the store again. This time is calculated by analyzing the buying patterns of all the store’s customers.
  • Unit of measure: Number of days

Lifetime

  • The average amount of time that buyers remain customers of the business.
  • Unit of measure: Number of days

3. Average Order Value calculation outputs

Average Order Value

  • The average order value of all the store’s orders divided by the store’s total number of orders.
  • Unit of measure: Dollars

Average Order Value of bottom quartile

  • The bottom quartile is the grouping of the lowest 25 percent. The average order value of bottom quartile is the average order value of the bottom 25% of orders of the store.
  • Unit of measure: Dollars

Average Order Value of top quartile

  • The top quartile is the grouping of the top 25 percent. The average order value of top quartile is the average order value of the top 25% of orders of the store.
  • Unit of measure: Dollars
  • Interpretation: Average order value by quartile metrics are most useful for stores with a broad product range. If there is a small gap between the bottom quartile and the top quartile there are less likely to upsell opportunities for the retailer based on the store’s current product base. While, if there is a big gap between the bottom quartile and the top quartile then there is more likely to be up-sell opportunities for the retailer based on the store’s current product base.

4. Purchase frequency calculation outputs

Repeat Customers

  • The total number of customers who have purchased from the store two or more times.
  • Unit of measure: Number of Customers

Purchase Frequency

  • The total number of orders divided by the total number of customers.
  • Unit of measure: Number of orders

Order interval

  • The average number of days between purchases made by customers.
  • Unit of measure: Number of days.

Want to calculate your retention? ☞ Calculate my retention now


This tool was created by Beans rewards and loyalty

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FAQ

Who can use the Beans CLV calculator?

It’s available to all WooCommerce and Shopify.

Do I need to be a Beans customer to use the calculator?

No. You do not need to be a Beans customer to use the calculator. You will need to connect your store to Beans, in order to allow the calculator to process your order history. Thousands of e-commerce retailers trust Beans with their data and we will never share data with anyone. Click here to see Beans policies.

How accurate is it?

The calculator has gone through considerable testing to ensure accuracy. However, it is only as accurate as the data you put in. Moreover, if your store is less than 1 year old the data will be less valuable as there hasn’t been enough time for a pattern to develop.