Retention Rate

Retention rate is the percentage of customers a business keeps over a period, calculated as customers retained divided by customers at the start, excluding new ones acquired during the window. It is the inverse of churn and the engine behind LTV: small, sustained gains in retention compound into outsized revenue because retained customers cost nothing more to acquire and tend to spend more over time. It is usually the highest-leverage metric a growth team can move, since improving it lifts both profit and the budget you can justify for acquisition. Retention is built through onboarding, product value, and lifecycle programs, not discounts alone.