Lifetime value analysis follows cumulative revenue or profit after acquisition, often by acquisition cohort. Acquisition cost alone cannot show whether cheaper customers stay and buy again.
The demo plots cumulative revenue per customer for January and February cohorts against the same months since acquisition. Compare values at equal ages and the slope of each curve to distinguish early purchase from repeat spending.
Do not treat unobserved future months for a young cohort as zero. Include refunds, margin, and acquisition cost separately when evaluating profitability.
When to use
Use it to compare longer-term customer value by acquisition channel or cohort.