By Sam Kusinitz, from Inbound Hub – http://bit.ly/1ohBtlR

Lifetime Value (LTV) is one of those metrics that keeps your CEO up a night. It’s the estimated revenue that a customer will generate during the entire span of their relationship with your company. It takes into account not only the initial purchase, but also how much a customer is likely to spend in the future as they purchase more products and services from you.

By understanding how much revenue each new customer will generate, you gain valuable insight into how to properly set your marketing budget and how much you should be spending on customer acquisition and customer retention — all things your CEO will love to see you focus on.

Check out the infographic below, created by KISSmetrics, to learn more about LTV, how you can calculate the lifetime value of your customers, and how you can use that information to optimize your marketing spend.