Are You Including Re-Upgrades in Your Customer Lifetime Value Estimates?

Customer lifetime value is an important metric because it allows you to estimate the ROI on your marketing spend, explained Bakley Smith, CFO of and guest speaker on this week’s Webinar for Subscription Site Insider members.Usually, customer lifetime value for subscribers can simply be calculated as total all-time revenue/total all-time number of paid subscribers.But certain subscription sites, especially those that see subscribers cancel and then rejoin (e.g., dating and seasonal sites, like, may want to take into “re-upgrades”. Re-upgrades are when a previous subscriber re-subscribes.During the Tuesday Webinar, Smith spoke about how one site realized they were crushing their competition once they included re-upgrades in their customer lifetime value estimates. Thus, the site was also able to justify a higher marketing budget for new subscriber acquisition.Of course, customer lifetime value isn’t the only metric you should be looking at to judge the success and worth of your subscription site. To discover simple formulas for calculating four key financial metrics, view the instant replay of Smith’s Webinar after joining Subscription Site Insider today!

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