Retention Rate is closely related to other metrics – NPS, Churn Rate, Repeat Purchase Rate and LTV. Therefore, its value can be increased only if it is clear what exactly is pushing the client away and why there is no desire to make a repeat purchase.
Where can I see the average CRR value?
Marketing research from organizations such as Profitwell or Lennysnewsletter will help you understand this issue in more detail and study the average value of indicators for specific business niches.
For what period should CRR be calculated?
First, you need to understand how the Retention Rate is calculated. To calculate it correctly, you need to select a time period, which can be a week, month, quarter or year. And then segment customers based on behavioral scenarios and conduct analysis for specific audience segments.
The determining factor in algeria email list choosing the length of the analyzed period is the transaction cycle, in other words, how much time passes from the first contact with the company to the purchase. The shorter it is, the more often you need to calculate RR. In addition, the indicator is also affected by the frequency of purchases, the speed of development and growth of the company itself and the industry in which the business is conducted.
What does a high indicator mean?
In marketing, Retention Rate is a certain level of development of a company. It shows how professionally it develops and how it manages to maintain the loyalty and trust of customers throughout its existence. The priority areas of work of any business should be activities to return old customers, motivate them to make repeat purchases and increase profits.
If the CRR value is low, it means that the company spends huge resources on promoting its product, which can later turn into losses. Interaction with clients is too expensive, but it should be the other way around.
With the help of RR, an entrepreneur will be able to understand what the current relationship with clients is, where it is necessary to improve, so that the profit becomes greater, and the expenses on advertising and promotion are less. If the relationship with users is built on the principles of trust and care, then they make purchases more often, and therefore the profit steadily grows.