How do you calculate retention rate?

Take customers at the end minus new ones acquired, divide by customers at the start, times 100.

Is retention rate the opposite of churn rate?

Yes — they sum to 100% for the same period and cohort.

What is a good retention rate?

It varies by model; many B2B SaaS firms target ~90%+ annually. Compare to your own segment.

Growth Marketing Glossary

Retention Rate

re·ten·tion rate/rɪˈtɛn.ʃən reɪt/noun

The share of a cohort still active at the end of a period — retention, expressed as a number.

Schematic — share of cohort retained

Term: Retention Rate
Part of speech: Noun
Field: Growth & Lifecycle
Also written: Customer retention rate

Forms & parts of speech

retention rate · noun

The percentage of customers kept across a period.

"A 90-day retention rate of 70% is strong for our category."

retain · verb

To keep a customer active.

"Better onboarding helps us retain more of each cohort."

Definition in plain terms

Retention rate puts a number on retention: of the customers you had at the start of a period, what share were still active at the end. It is the direct inverse of churn rate — a 95% monthly retention rate means a 5% monthly churn rate — and is usually measured by cohort to reveal the real trend.

The mechanics

Take the customers at the start, subtract any new ones acquired during the period, count how many of the original group remain, and divide by the starting number. Measuring by cohort and at consistent intervals (day 30, 90, 365) keeps the comparison honest as the business grows.

When it matters

Retention rate is the cleanest single read on whether a product delivers lasting value. Small improvements compound enormously: lifting monthly retention a couple of points can nearly double average customer lifetime, which in turn lifts lifetime value and the acquisition cost you can afford.

Worked example. A store has 1,000 customers at the start of the quarter, acquires 200 new ones, and ends with 1,050. Retention rate = (1,050 − 200) ÷ 1,000 = 85%. The 15% who lapsed are the quarter's churn — and the lever most worth pulling, since keeping them costs far less than replacing them.

Failure modes to watch. Forgetting to exclude newly-acquired customers from the end count (inflating the rate); reporting a blended rate that hides weak newer cohorts; and comparing rates measured over different windows as if they were equivalent.

Formula

Retention Rate = ((E − N) ÷ S) × 100S = customers at start · E = customers at end · N = new customers acquired during the period. The inverse of churn rate.

Benchmarks

Retention rate benchmarks depend heavily on model, contract length, and how "active" is defined.

B2B SaaS — annual

~90%+ is strong

Consumer subscription

~60–70%+ is healthy (varies)

Mobile app — day 30

Highly category-dependent

Calculators

Related calculators →

Ranges are illustrative; every published figure is cited from a named public source or labelled “RGM analysis.”

Synonyms & antonyms

Synonyms

customer retention raterepeat ratestickiness

Antonyms

churn rateattrition rate

Origin & history

From "retention" (Latin retentio, "a holding back," from retinēre) plus "rate." The metric form spread with subscription and SaaS analytics, when keeping customers became as measurable as winning them.

Etymology: Online Etymology Dictionary.

Usage trends

Search interest for this term over the last five years:

View interest-over-time on Google Trends →

Common questions

How do you calculate retention rate?: Take customers at the end minus new ones acquired, divide by customers at the start, times 100.
Is retention rate the opposite of churn rate?: Yes — they sum to 100% for the same period and cohort.
What is a good retention rate?: It varies by model; many B2B SaaS firms target ~90%+ annually. Compare to your own segment.

Related tools & calculators

calculatorChurn rate calculator
calculatorLifetime value calculator
calculatorNet revenue retention calculator

Resources & people to follow

bookLean Analytics — Croll & Yoskovitz
thought leaderDavid Skok (For Entrepreneurs) — SaaS metrics
thought leaderPatrick Campbell — pricing & retention research

Curated, non-competitor resources verified per term.

Related training

moduleSubscription growth
moduleMarketing analytics

Disciplines

Areas of marketing where retention rate is a core concern:

Growth marketingMarketing analyticsSubscription & SaaS

Sources

trendsGoogle Trends — "retention rate"
etymologyOnline Etymology Dictionary — "retention"