Customer retention rate (CRR) measures the percentage of customers a brand or retailer retains over a given period of time.
Measuring your brand’s customer retention rate can help you gain valuable insights into customer behaviors — and the factors that are resulting in successful engagement and advocacy. Though a quantitative metric, CRR becomes a relative measure with customer experiences and the buying journey, as brands and retailers seek to increase customer loyalty through effective customer relationship and growth strategies.
To calculate CRR, identify the period of time you will measure, the number of existing customers at the start of this time period (S), the number of customers at the end of this time period (E), and the number of new customers (N). The formula appears as CRR = ((E-N)/S) x 100.