Renewal Rate, in business and subscription-based models, refers to the percentage of customers or subscriptions that renew within a given period. This metric measures customer retention and the effectiveness of a business in retaining its existing customer base. It tracks churn and retention for the invoicing month.
Typically, a renewal rate above 80% is seen as highly favorable. It signals the effectiveness of a company’s efforts in retaining customers. The ultimate goal for every company is to maximize its customer retention rate, striving to bring it as close to 100% as possible.
ƒ Count(Customers Renewed) / Count(Total Customers Up for Renewal)
Typically, a renewal rate above 80% is seen as highly favorable. It signals the effectiveness of a company’s efforts in retaining customers. The ultimate goal for every company is to maximize its customer retention rate, striving to bring it as close to 100% as possible.
Logo Churn
Propensity to Renew
The Rule of 40
A renewal rate above 80% is generally considered favorable, indicating strong customer retention efforts.
In insurance, the renewal rate refers to the percentage of policyholders who renew their insurance policies at the end of the policy term.
The retention rate measures overall customer retention, while the renewal rate focuses on the percentage of customers renewing subscriptions or policies.
The revenue renewal rate measures the percentage of recurring revenue retained from existing customers after renewing subscriptions or contracts.