Why Customer Lifetime Value (CLV) Should Drive Your Strategy

Many firms focus heavily on acquiring new clients, yet it costs five to seven times more to win a new client than to keep an existing one. Without attention to Customer Lifetime Value (CLV), you’re likely leaving revenue, and long-term growth, on the table.

Case example: A firm with untapped potential

A midsize firm we worked with noticed that while clients were satisfied, most didn’t return for repeat matters. Their average CLV was just $15,000, well below the industry benchmark of $25,000.

Here’s what changed:

• Quarterly check-ins with past clients (even when there wasn’t an active case) increased reengagement by 40%.
  

• Bundled services, like combining estate planning with trust administration, raised average revenue per client by 22%.
  

• Referral incentives brought in new, higher-value clients from existing relationships.
  

Within a year, their CLV increased to $28,000.

How to estimate CLV for your firm

Use this formula:
CLV = Average case value × Annual matters per client × Client lifespan (in years)

Example:

• Average case: $5,000
  

• Matters/year: 1.5
  

• Lifespan: 4 years
  CLV = $30,000
  

Why CLV matters

Tracking and improving CLV helps you:

• Invest more confidently in client relationships

• Forecast revenue with greater accuracy

• Prioritize practice areas that deliver long-term value
  

It’s not just about increasing volume. It’s about deepening value per client.

If you’re curious what CLV might look like for your business or want help mapping it out, we’re always happy to take a look.
Schedule a quick consultation to explore what’s possible.