Typical LTV of customers are calculated based on a 3 year revenue estimate with annual increment of 15-30%. So a $10000 deal in Year 1 will ultimately provide around $38K in revenue.
But there is a secondary revenue source that most calculations miss. This is by the virtue of your champion in the first company leaving for another doing the exact same job. She is likely to buy your product again and according to this article by Jason Lemkin, this happens at least 10% of the time. Add to this the 30% probability of her influencing at least one new buyer. This totals up to a revenue range of $60K. This is much different than the typical $38K calculation.
The key of course is to ensure the customer is super happy and invest in Customer success with your product.
Great read as always and worth examining how you can build this into your revenue flywheel. Saas mostly is low touch. How can we build an 11Star experience which can up the revenue potential by 50%?
Where I learnt it #225
CLTV Isn’t The Whole Story. Don’t Shortchange Second-Order Revenue.
https://www.saastr.com/its-not-just-cltv-its-your-trgcltv-that-matters-total-all-in-revenue-generated-by-your-customer/
