Over the years, marketing experts have made their own definitions for what customer lifetime value, or LTV, is. However, all of these definitions boil down to the same common theme: LTV is the projected net profit contribution of a customer over time. It's basically the estimated dollar value attributed to each customer or client relationship.

As a business owner, you must have a LTV that's much higher than the cost of acquiring a customer. Otherwise, you'll continue to lose money over time. When you increase customer lifetime value, you protect the long-term profitability of your business.