Customer lifetime value (LTV)
Customer lifetime value (LTV or CLV) estimates the gross margin a customer brings in over their life: average monthly revenue per customer × gross margin ÷ monthly churn. Compared with the cost to acquire a customer (CAC), it shows whether growth pays: 3:1 is the common benchmark, with CAC earned back within about 12 months.
Related terms
A/B test
An experiment that shows two versions to comparable groups at random and compares how each converts, to learn whether a change caused a difference.
Activation rate
The share of new sign-ups who reach the moment they first get real value from a product, such as creating a first project.
Churn rate
The share of customers (or revenue) lost in a period. Monthly customer churn of 5% means losing nearly half your customers in a year.
Net Promoter Score (NPS)
A loyalty score from −100 to +100: the share of promoters (9–10 on “how likely are you to recommend us?”) minus the share of detractors (0–6).
RICE scoring
A prioritization method from Intercom: Reach × Impact × Confidence ÷ Effort, so ideas can be compared on one scale.
Assumption
A belief a solution depends on. If it turns out to be wrong, the solution fails — so the risky ones are worth testing first.