Breaking Down the Lifetime Value of a Plumbing Customer (and How to Increase It)

For plumbing businesses, understanding the lifetime value (LTV) of a customer is not just beneficial—it’s essential for long-term success. This metric helps you gauge the total revenue a single customer can generate over their relationship with your service. Here’s a breakdown of what LTV is, why it matters, and how you can work to increase it.

Understanding Lifetime Value in Plumbing

Lifetime Value represents the total amount a customer is expected to spend on your services throughout the duration of their relationship with your business. This encompasses everything from the initial service call to any follow-up maintenance, repairs, or additional services like HVAC or remodeling.

Having a firm grasp on this number is crucial to budgeting for customer acquisition through advertising and forecasting sales. As the age old adage goes “what is measured, improves”.

A consistent trend we see when working with plumbing businesses is that the most successful operations have a clean calculated lifetime value number (usually in the range of $4,000 – $5,000) and a systematic approach to increasing it.

Calculating the Lifetime Value

The LTV calculation involves a few key factors:

  1. Average Service Call Value: Typically, this ranges between $600 and $800, but the base cost for any service call is around $200.
  2. Frequency of Service: Determine how often a typical customer might need your services. For most households, plumbing services are required at least once a year, if not more.
  3. Duration of Customer Relationship: On average, a customer might stay with a plumbing service for 5 to 10 years, depending on the quality of the service and customer satisfaction.
  4. Referrals and Additional Sales: Effective upselling or cross-selling services, and gaining new customers through referrals can significantly impact the overall LTV.

To put it into a formula: LTV=(Average Service Call Value×Frequency of Service×Duration of Relationship)+Additional Revenues from Upselling and ReferralsLTV=(Average Service Call Value×Frequency of Service×Duration of Relationship)+Additional Revenues from Upselling and Referrals

Strategies to Increase LTV

1. Focus on Customer Experience

A seamless first experience is critical. Ensuring that the first service call is hassle-free can make the difference in whether a customer decides to return. Homeowners generally prefer to stick with a reliable service rather than risk an unknown alternative.

2. Offer Maintenance Contracts

Regular maintenance helps prevent emergencies and prolongs the life of plumbing systems. Offering service agreements can turn irregular customers into regular ones, providing stable, recurring revenue.

3. Implement Cross-Selling and Upselling

When servicing a call, look for opportunities to introduce other services your company offers, such as HVAC system maintenance or bathroom remodeling. This not only increases the transaction value but also reinforces your value as a full-service provider.

Our favorite simple technique is outreach with a simple text message. Ie. “Hey Jim in case you were unaware, we also do hvac. Would you like to schedule a comprehensive tune up before the weather gets hot?”

4. Utilize Technology

Leverage CRM software to track every interaction with your customers. This can help personalize the service offerings and ensure that you are meeting the customers’ needs more accurately, which can enhance customer loyalty and increase LTV.

5. Keep Communication Open

Regular updates through emails, newsletters, or SMS about upcoming offers, seasonal checks, or simple maintenance tips keep your customers engaged and remind them of your value.


The lifetime value of a plumbing customer provides a clear picture of the potential each customer holds. By understanding and increasing this value, plumbing businesses can significantly enhance their profitability and ensure their growth in a competitive market. Remember, it’s not just about the immediate profit from a job but about cultivating a long-term, profitable relationship.