Reactivation Monthly Recurring Revenue (Reactivation MRR) quantifies the monthly recurring revenue generated from customers who were previously inactive or lapsed but have been successfully re-engaged or reactivated. In subscription-based businesses, reactivation refers to bringing back customers who had stopped using or subscribing to a product or service.
It is calculated by adding the total revenue generated from the customers who have reactivated their subscriptions. For example, if three customers, each paying $200 MRR, had canceled their subscription last month but reactivated it this month. Your total Reactivation MRR would be $600.
ƒ Sum(Reactivation MRR)
In many businesses, the most significant portion of Monthly Recurring Revenue (MRR) comes from new business. More precisely, for startups with MRR less than $10,000, new business MRR constitutes 77.7% of the total MRR added. However, as businesses expand, the proportion of revenue originating from new business tends to decrease. For startups with MRR surpassing $1 million, this proportion drops to nearly half at around 50.7%.
Monthly Recurring Revenue
Customer Acquisition Cost
Expansion MRR Growth Rate
Reactivation MRR is vital as it provides insights into the financial impact of reactivating customers, measures the success of re-engagement efforts, and enhances customer lifetime value.
A high Reactivation MRR suggests that the business has successfully reactivated previously inactive customers, contributing positively to the monthly recurring revenue.
Reactivation MRR contributes to revenue growth by capitalizing on the re-engagement of customers, effectively turning them into revenue-generating customers again.