How to Calculate “Customer Life”
The Single Metric That Predicts Your Company’s Future
The Hidden Signal in Your Data
Here’s something wild: With just a few months of customer data, you can predict where your business will be in two years.
One company we analyzed showed a customer life of 1.6x purchases in January 2021. Nearly two years later? They landed at 1.7x. The early signal was almost perfect.
That’s the power of understanding customer life, it’s the metric that tells you if you’re building something sustainable or just churning through customers.
Why Every Founder Should Obsess Over Customer Life
Customer life isn’t just another vanity metric. It’s the foundation of your unit economics:
Double your customer life, double your LTV (without touching pricing)
Your LTV:CAC ratio lives or dies here (VCs know this)
It predicts cash flow better than any forecast (because it IS your forecast)
Yet most founders calculate it wrong, or worse, don’t calculate it at all.
The Two Ways to Calculate Customer Life (And When to Use Each)
Method 1: The Cumulative Approach (Your North Star)
This is your signal in the noise, the metric that actually matters:
Pull all your invoices (ever, or at least 12+ months)
Count total orders
Count unique customers
Divide: Total Orders ÷ Unique Customers = Customer Life
Real Example: A company from January 2024 to September 2025:
374 unique customers
2,192 total purchase months
Customer Life = 5.9 months
This number moves slowly. That’s the point. It’s your true signal.
Method 2: Monthly Sampling (Your Early Warning System)
This is where things get interesting, and slightly weird.
Calculate your repeat rate each month:
Repeat Rate = Returning Customers This Month ÷ Total Customers Last Month
Customer Life = 1 ÷ (1 – Repeat Rate)
The dotted line in this chart shows monthly sampling jumping around like crazy:
See that spike in March 2025? With a 92% repeat rate, the math suggests a 12-month customer life. And September? It goes negative.
Wait, Negative Customer Life?Don't panic. Negative customer life = negative churn = very good news. In September 2025, this company had 69 returning customers versus only 63 total customers the previous month. More customers came back than existed before. That's the holy grail of retention. When customer life goes negative, you've essentially achieved infinite LTV. The math gets wonky, but your bank account will thank you. |
The Predictive Power That Changes Everything
Remember that company showing 1.6x customer life in early 2021? Here’s their full journey:
With barely any data, the early signal predicted the future within a few percentage points. That’s not luck, that’s math.
The Customer Life Diagnostic: Your 10-Minute Audit
Here’s exactly what to do, in order, to master your customer life:
Calculate & Segment (Do This Today)
☐ Calculate cumulative customer life for your entire history
☐ Set up monthly tracking going forward
☐ Separate Shopify, Amazon, and Wholesale customers (they’re different universes)
☐ Tag SMB vs Enterprise customers, the difference will shock you
Diagnose What Your Numbers Mean (Do This Tomorrow)
☐ Under 6 months? You have a product-market fit problem
☐ 6-12 months? Your onboarding is probably broken
☐ 12-24 months? You’re average, time to become exceptional
☐ 24+ months? You have pricing power you’re not using
☐ Negative churn? You’ve built a compound growth machine
Find Your Biggest Leak (Do This Week)
☐ If months 1-3 are weak: Fix your Day 1, 7, and 30 experience
☐ If months 4-6 drop off: Your product isn’t delivering its promise
☐ If months 7-12 decline: Competitors are eating your lunch
☐ If it’s declining overall: Your market might be leaving you behind
Fix One Thing First (Do This Month)
☐ 90% of the time, it’s onboarding, seriously, yours probably sucks
☐ Kill the confusing features nobody uses
☐ Add one check-in that actually helps customers succeed
☐ Make sure people experience value in week one, not month three
Track What Matters to Investors (Do This Quarter)
☐ Show cumulative (proves stability) AND monthly (shows trajectory)
☐ Compare cohorts, newer customers should retain better
☐ Calculate the revenue impact: +1 month of life = $X in LTV
☐ Know your number versus competitors (VCs will ask)
The Million Dollar Question
Every month your customer life improves is pure profit. It’s the only metric where improvement flows straight to your bottom line without additional cost.
A founder once told me: “We spent six months trying to reduce CAC by 20%. Then we improved customer life by two months and achieved twice the impact in six weeks.”
That’s the leverage of customer life.
Most founders are fighting on the wrong battlefield, grinding to acquire customers 10% cheaper when they could be keeping them 50% longer.
Your Move
Right now, you fall into one of three camps:
You don’t know your customer life (calculate it today, the formula is Orders ÷ Customers)
You know it but aren’t tracking it monthly (set up tracking, future you will thank present you)
You’re tracking but not improving it (pick ONE thing from the diagnostic and fix it)
The companies that compound are obsessed with customer life. The companies that struggle are obsessed with new customer acquisition.
The math is clear. The path is simple. The only question is: Will you take it?
P.S. – That predictive power I mentioned? It works because customer behavior is remarkably consistent once you have enough data points. Usually 100+ customers and 3+ months tells you everything. If you have that much data and aren’t calculating customer life, you’re flying blind with your eyes closed.
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