Why LTV is the SME superpower
Once you know LTV, you know how much you can spend to acquire a new customer. Marketing becomes math, not gut feel.
Veira tracks AOV, frequency and retention per customer automatically.
Customer Lifetime Value (LTV) Calculator
LTV = AOV × Purchase frequency × Customer lifetime (years) × Gross margin %. Tells you how much you can spend acquiring a new customer.
Calculator
Result
LTV KES 18,900.00
Annual revenue per customerKES 18,000.00
Lifetime revenueKES 54,000.00
Lifetime gross profit (LTV)KES 18,900.00
Max CAC for 3:1 paybackKES 6,300.00
Healthy SaaS uses LTV:CAC of 3:1. Retail can go higher because margins fund repeat purchase.
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Worked examples
AOV 1,500 · 12/yr · 3 yrs · 35% GM
- LTV = 1,500 × 12 × 3 × 35% = KES 18,900 · Max CAC ≈ KES 6,300
Frequently asked questions
What is CAC?
Customer Acquisition Cost, what you spend to get one new customer.
Why 3:1?
A 3× payback covers all overhead and leaves real profit.
Does retention matter most?
Yes. Doubling retention doubles LTV linearly.
How does Veira measure retention?
Through customer accounts on POS, first-purchase date and last-purchase date.
Can I do this without customer accounts?
Only by survey. Loyalty programmes attribute purchases to identities.
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Jane M.
Verified business
Finally a tool that gets Kenyan tax rules right. Zero KRA rejections since using this.
5/10/2024
Noor A.
Verified business
Accurate and saves me hours every month. The breakdown is clear and my staff finally understand their deductions.
5/20/2024
Ahmed H.
Verified business
Exactly what I needed. Calculated costs before ordering and saved a fortune on import duties.
5/15/2024
David K.
Verified business
Very helpful. Only thing missing is export to CSV but overall excellent.
5/5/2024
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