Ecommerce Metrics · Updated June 2026
Customer lifetime value (CLV or LTV) is the total profit a business expects from a customer across their entire relationship. It combines average order value, purchase frequency, and customer lifespan — and it sets the ceiling on what you can afford to spend acquiring a customer.
A simple formula: CLV = AOV × purchases per year × years retained × gross margin. Stores with subscriptions or strong repeat behavior can sustainably outbid competitors on ads because each customer is worth more.
Multiply average order value × average orders per customer per year × average customer lifespan in years, then apply your gross margin. Shopify reports "customer lifetime value" cohorts in Analytics for Plus plans, and several apps compute it for all plans.
Average order value (AOV) is total revenue divided by number of orders — the average amount a customer spends per checkout. Raising AOV through bundles, upsells, and free-shipping thresholds grows revenue without acquiring new traffic.
Repeat purchase rate is the percentage of customers who have ordered more than once. Healthy Shopify stores typically see 20–35%. It is the clearest indicator of product satisfaction and retention-marketing effectiveness.
Churn rate is the percentage of customers who stop buying from you over a given period. For subscription commerce it is the single most important health metric: a 5% monthly churn means losing nearly half your subscriber base in a year.