What Isabel and Cinnamon Fern said.
I don’t actually track it with a spreadsheet, but think about it in general terms when I’m buying or thinking about buying something.
At a basic level, the CPW of the items in your outfit = the cost per day to get dressed, which then if calculated x number of days in year (or thereabouts) = your clothing budget, kind of. (of course that is based on the “final” CPW you’ve estimated an item will have; if you’re actually tracking something, the CPW can keep coming down.) But most people don’t “buy a wardrobe” and then stop.
So again, at a basic level, the CPW is a guide to how often I’d be able to replace something, or how many new or trending items I can buy, or can show me ways I can reduce my clothing budget if I want.
Also, you can think of CPW with regard to items that are not worn that often, but stay in your wardrobe, vs. items that are worn a few times and then tossed (or should be tossed). Each has its own issues. One person might have a holiday outfit that has good longevity; it may still have a pretty high CPW, but while it’s there, it’s the right thing. So, the “priceless” peace of mind of having something to wear, and not spending even more on mad-dash purchases each year.
Or one party clutch might be inexpensive and therefore low CPW even if seldom used, or it might have been a splurge but serves as the party “jewel” and elevates the rest of the outfit, though at a high CPW.
One thing I’m experimenting with is more cross-over between occasion-capsules. The main reason I think this is a good idea is that all items have a shelf life and I ought to wear them more often during any given year and then have more resources to replace instead of “hoarding” them. Plus, for me it’s somewhat effortful to get all the parts of an outfit together (proportions,footwear) and so I need to be efficient and get not just CPW $$-wise, but leverage the time cost of creating.
My biggest concern is not that I’ll have an item that I wear happily once or twice a year for many years, but that perhaps in just a year or 2 years many items will seem stale or not fit right, and it will have been wasted $$ to have many such items worn only occasionally whilst the clock is ticking down to obsolescence. So my biggest loss in CPW in the past has been overduplication --overestimating the amount of clothes that I need or can wear regularly.