Customer Lifetime Value Calculator
Calculate the lifetime value of your pool service customers to make smarter decisions about marketing spend and customer retention.
Lifetime Value Analysis
Understanding Customer Lifetime Value
Customer Lifetime Value (LTV) tells you how much revenue a customer generates over their entire relationship with your business. It's one of the most important metrics for making smart decisions about marketing, pricing, and customer retention.
Why LTV Matters for Pool Service
Pool service is a recurring revenue business—customers pay monthly for years. A customer worth $175/month for 3 years generates over $6,000 in revenue. Understanding this helps you make better decisions:
- Marketing budget: If LTV is $6,000, spending $200 to acquire a customer makes sense
- Customer retention: Keeping existing customers is almost always cheaper than finding new ones
- Pricing strategy: Higher prices may reduce tenure—or may not. LTV helps you test
- Service quality: Every callback, every mistake shortens tenure and reduces LTV
The LTV:CAC Ratio
The ratio of Customer Lifetime Value to Customer Acquisition Cost (LTV:CAC) tells you how efficient your marketing is:
- Below 1:1: You're losing money on every customer acquired—unsustainable
- 1:1 to 2:1: Barely profitable, little room for error
- 3:1 to 5:1: Healthy business, good marketing efficiency
- Above 5:1: Excellent—you could probably spend more on marketing to grow faster
Improving Your LTV
There are three ways to increase customer lifetime value:
- Increase monthly revenue: Raise prices, upsell additional services, add premium tiers
- Improve gross margin: Reduce costs (better chemical pricing, route efficiency)
- Extend customer tenure: Better service quality, relationship building, loyalty programs
Of these, extending tenure often has the biggest impact. A customer who stays 4 years instead of 3 adds 33% to their lifetime value—with zero additional acquisition cost.
Frequently Asked Questions
What's a good LTV for pool service customers?
Most pool service companies see LTV between $3,000 and $8,000 per customer. This depends on your pricing ($150-250/month typical), margin (50-70% typical), and tenure (2-5 years typical). Higher-end markets with better retention can see LTV above $10,000.
How do I calculate my actual churn rate?
Count customers lost in a month, divide by total customers at the start of the month. If you started with 100 customers and lost 3, your monthly churn is 3%. Track this over 6-12 months to get a reliable average. Seasonal businesses should account for seasonal variations.
What should I include in acquisition cost?
Include all marketing expenses: Google Ads, yard signs, door hangers, referral bonuses, lead service fees, and your time spent on sales. If you spend $1,500/month on marketing and acquire 10 new customers, your CAC is $150. Be honest—most service companies underestimate true acquisition costs.
Should I use tenure or churn-adjusted LTV?
Use actual tenure if you have reliable historical data on how long customers stay. Use churn-adjusted LTV (which calculates expected tenure from churn rate) if you're newer or want a more conservative estimate. The formula: Expected tenure = 1 / monthly churn rate.
How does LTV affect route valuation?
Routes are typically valued at 10-14x monthly revenue, which roughly equals 1-1.5x annual revenue. This is actually a discount to LTV because buyers account for churn and risk. If your LTV is significantly higher than typical route valuations, you're building valuable, sticky customer relationships.
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