What Is Ecommerce LTV?
Ecommerce LTV is the total a customer spends at a store across all their orders over time, built from average order value and how often they buy again, not from recurring subscription revenue retained until churn. It is a projection of repeat purchase behaviour, so it is only as reliable as your history of buyers actually coming back.
For a store the arithmetic runs off two numbers: average order value, and how many times a buyer orders in a period. Multiply them for annual spend, then extend across the years a buyer keeps returning. Worked through: a $40 average order value with three orders a year gives $120 a year. If that buyer stays active for two years, LTV is roughly $240. Push average order value to $55 with the same three orders and the year is worth $165 instead. The levers are order size, order frequency, and how long the relationship lasts, and for most stores frequency is the hardest of the three to move. This is a different engine from subscription LTV. A membership or an app plan bills on a schedule and you multiply revenue per period by average lifespan. A store earns nothing automatically between orders, so every repeat purchase has to be won again with a reason to return. Here is the caveat that gets skipped: most stores have very few repeat buyers. If a shopper buys once and never comes back, the store's LTV for that customer is a single order, so a $40 first order means an LTV of $40, full stop. That is not a failure to calculate, it is the real number, and it changes everything downstream. A store whose customers mostly buy once cannot afford to pay as much to acquire them as a store with a loyal base, because there is no second order to earn the acquisition cost back. Before trusting a lifetime figure, check what share of your buyers actually place a second order. If that share is small, plan against the value of one order, not a hopeful multiple of it.
Why it matters
LTV sets the ceiling on what a store can afford to spend to win a customer. If a merchant's real LTV is one $40 order because repeat purchase is rare, a $45 cost per acquisition loses money on every sale no matter how good the ad is. A store with genuine repeat buyers worth $240 over two years can spend far more up front and still come out ahead. Knowing which store you are, and being honest about the repeat rate rather than assuming loyalty, keeps the acquisition budget tied to what customers actually spend. Infinall's Strategy Agent factors your pricing into how it splits budget across funnel stages, but the repeat rate that decides your true LTV is something only your own order history can tell you.
Related terms
Frequently asked questions
How do I calculate LTV for my store?+
Multiply average order value by how many times a typical buyer orders in a year, then extend across the years they keep returning. A $40 average order value at three orders a year is $120 a year, and about $240 if the buyer stays two years. If most of your buyers only ever place one order, your real LTV is that single order, for example $40, not the multi year figure.
What if my store has almost no repeat buyers?+
Then your LTV is close to the value of one order, and you should plan against that number. A store with no repeat purchase has an LTV equal to a single sale, so a $40 first order means $40 of lifetime value. That caps what you can pay to acquire a customer far lower than a store with loyal buyers, so check your actual second order rate before assuming any repeat revenue exists.