Lifetime Value (LTV) plays a crucial role in pricing strategy as it helps in determining the total revenue a business can expect from a single customer over the course of their relationship. It takes into account the revenue, the frequency of purchases, and the expected relationship length. By understanding the LTV, businesses can make informed decisions about how much money to invest in acquiring new customers and how to price their products to maximize profit.
Need to evaluate the best pricing strategy for a product? This Pricing Strategy spreadsheet includes...
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