Lifetime Customer Value
This chapter, “Lifetime Customer Value,” takes a thorough look at one of the most fundamental concepts in the freemium model: lifetime customer value, or the total value of each customer. Lifetime customer value is an important consideration in freemium products, where user acquisition costs can impact the degree to which products can profitably grow. The chapter begins with an overview of lifetime customer value at a conceptual level, describing its component parts and what it is used for in an organization. The chapter then proceeds into a set of methodologies that can be used to calculate lifetime customer value: the spreadsheet method, in which the product team collects data about the product in a spreadsheet ...
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