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You have completed Introduction to Churn and Lifetime Value (LTV) Analysis!
You have completed Introduction to Churn and Lifetime Value (LTV) Analysis!
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We introduce a basic, but ultimately flawed formula for calculating LTV.
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If it's flawed, why am I sharing it?
0:00
Well, because it's a building block for
a model that isn't flawed, and
0:01
it's probably something you'll
come across at some point.
0:05
In fact, I still see people using it
regularly, so just bare with me for a bit.
0:09
A flawed LTV model states that
LTV is calculated by multiplying
0:15
the inverse of churn times
average revenue per user.
0:19
Or again,
LTV = 1 divided by gross customer
0:24
churn times ARPU, why does this matter?
0:28
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