Understanding Retention Part 3: LTV and Retention
🚨 Understanding Retention Part 3: LTV and Retention
In my previous posts, I covered the importance of long-term retention and how games with low retention will survive. Now, it’s time to talk about how we can calculate LTV (lifetime value) and its relation to Retention.
⥅ Here’s the formula
LTV = Lifetime ⛌ ARPDAU
👉 Using this formula you can make estimations on your early retention data
❓How Retention Impacts LTV
Retention and LTV are closely linked. The longer players stick around, the more opportunities they have to make in-app purchases or watch ads, increasing their lifetime value.
↳Higher retention naturally translates to a higher LTV.
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