3 min read
How to Make more Money WITHOUT Spending A Dollar on Ads: The Power of LTV

If you’re like most business owners, you’re looking to increase profits, right? You probably hear that marketing and advertising are great ways to do that, and it’s true. However, there are some things you can do to make more money without spending a dollar on your marketing. The best part? Once you’ve increased your LTV (Lifetime Value), all your marketing results will be compounded, resulting in much better results!

What is LTV and how does it work?

LTV, or Lifetime Value, is the amount of money that your average client brings you over the course of their lifetime. To get your LTV, you take the average money your customers spend / visit and multiply that by how many visits your average customer has each year. Multiply that by the amount of years your customers stay with you. Then multiply that by the amount of referrals your average customer brings you over that period of time. It sounds more confusing than it is, so let’s take a look at an example.

Let’s say you own a restaurant. Your average customer spends $30 / visit. They come 100 times each year and typically come for about 3 years before they end up moving or frequenting another restaurant. Over those three years, they tend to bring 2 other people.

So the formula is $30(Spend/Visit)  X 100 (Visits/year) X 3 (Years) X 3 (Referrals + Themselves)

$30 X 100 X 3 X 3 = $27,000!

What does that mean? That means that, in this example, the average customer brings this restaurant $27,000 over their lifetime.

Why is this important? This is important for a few reasons. The first is to better understand how your marketing efforts now affect your profits down the line. The second reason is that once you understand this, you can work to increase that number.

How do you increase your LTV?

In this example, there’s 4 ways you can increase your LTV. 

Increase average spend / visit

Let’s start with the amount spent per visit. The average person spends $30 each visit to your restaurant. So how do you increase that? Add-ons! In this example, you could offer your customer special cocktails that complement their food. Or maybe you could offer a dessert! The idea is that you want to offer something that compliments what they are already ordering from you.

Increase frequency of visits

In this example, your customers are already coming pretty often. You can increase this by having weekly specials with food, cocktails, or fun things like Bingo/Trivia!

Increase longevity of customers

There’s always going to be things out of your control when it comes to the length of time someone stays a client. For example, people move & die. Let’s not forget that you also have competition that may be taking some of your business. You can combat the latter with things such as loyalty / rewards programs. Something like “Buy 9 Lunches, Get your 10th Free” could be exactly what you need to get people to come back for years to come!

Increase your referral rate

Every new person your customer brings could multiply your LTV! In this example, you could do something like live music, bingo, or some other entertainment that would entice your customers to bring their friends. 

Every business is different. Roofers, for example, usually only install one roof / client, unless they are in business for decades or their client owns multiple businesses. So for a roofer, it would be wise to increase the amount they make for each roof and the amount of referrals each client brings in.


In summary, enhancing your business's LTV is a powerful strategy to increase profits without pouring extra funds into marketing. By focusing on increasing the average spend per visit, the frequency of visits, the longevity of your customers, and boosting your referral rate, you're not just boosting immediate gains; you're investing in the long-term growth and sustainability of your business. 

Remember, each aspect of improving LTV not only contributes to a richer customer experience but also sets a foundation for more effective marketing efforts, ensuring that every dollar spent in the future works even harder for you. Whether you're serving up memorable meals in a restaurant or installing roofs, understanding and optimizing your LTV unlocks a pathway to greater profitability, making it a crucial component of your business strategy.

Ready to supercharge your marketing? Contact us today to get your complimentary consultation now!