Read the equation
Combines average revenue per user, gross margin, retention and lifetime as the poster specifies.
Its role in the build
The MADDIE Equation — Client Conversion Formula
Terms & definitions
| Term | Meaning in this source |
|---|---|
| M | Message score. In its component formula p_i denotes pain points and w_i emotional weight. |
| L | Lead value. In this component v_i is value of outcome i and p_i probability of outcome i. |
| CLV | Customer lifetime value. |
| ARPU | Average revenue per user. |
| GM | Gross margin percent, as labeled. |
| R | Retention, labeled years. |
| L_t | Lifetime, labeled years. |
How it works
Read CLV as the quantity being defined or updated by this relation.
Substitute the source-defined variables or recorded values and follow the displayed arithmetic and indexing exactly.
Use this version’s variable definitions and update order. The same symbol may be assigned a different meaning in another build.
Assumptions & limits
The source labels both R (retention) and L_t (lifetime) in years. Their separate operational definitions and resulting dimensions are not resolved in the image.
GM is labeled Gross Margin %, but whether it is entered as a fraction or a percent number is not stated.
Original context
Read the surrounding source passage
The MADDIE Equation — Client Conversion Formula: Combines average revenue per user, gross margin, retention and lifetime as the poster specifies.
Exact original notation
CLV = ARPU × GM × R × L_t
Related builds
Sources & provenance
CLV = ARPU × GM × R × L_t