How does Braavo calculate LTV?

An explanation of Braavo's predictive LTV methodology

Graham Gnall avatar
Written by Graham Gnall
Updated over a week ago

Braavo's LTV is a predictive, retention-based model for subscription-based apps, consisting of lifetime and average subscription price (ASP) inputs, for monthly subscriptions.

Using Braavo's Lifetime & LTV reports

Under the Cohorts > LTV tab, the first thing you'll be presented with is the Lifetime trend chart. This displays the predicted lifetime (in days) for daily cohorts and grouped by your various subscription durations.

Clicking on a single cohort will display the retention profile for that cohort, consisting of subscription billing periods where subscribers either renew their subscription or churn:

The metric toggle lets you switch between Lifetime and LTV:


Read on below to learn about how each of these metrics is calculated.

Lifetime

The average length of time your subscriptions last. This is calculated on the cohort level, based on when a subscriber initiated their subscription.

Calculation
Lifetime is calculated as the integral of a given cohort’s retention profile. The retention profiles - shown when clicking on a point on the Lifetime chart - is based on renewal/churn events that occur at each renewal period. For retention profiles with 2-5 events, Braavo projects the rest of the profile based on historical averages by subscription and country.

Potential Delays
Lifetime reports may be delayed due to the durations of your subscriptions. Retention can only be calculated once there has been at least one renewal period since a subscription was initiated. For this reason, Lifetime is not available for annual subscriptions.

LTV

The average lifetime value of a subscription. This is calculated on the cohort level, based on when a subscriber initiated their subscription.

Calculation
Retention-based approach. The Lifetime of each cohort is multiplied by the average subscription price (ASP) applied on a daily basis. ASP is used to account for multiple currencies or rates that subscribers may pay for the same subscription.

Potential Delays
LTV reports may be delayed due to the durations of your subscriptions. Lifetime can only be calculated once there has been at least one renewal period since a subscription was initiated. For this reason, LTV is not available for annual subscriptions.
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