CATEGORY > GLOSSARY
Renewal Rate
What Is Renewal Rate?
The renewal rate is the percentage of customers who renew their subscription or continue using a service after their initial contract period.
How To Calculate Renewal Rate?
Renewal Rate = (# of Renewing Customers / # of Expiring Customers) * 100%
An Example Of Renewal Rate
- A company has 100 customers whose contracts expire in a month and 80 of them renew.
- Renewal Rate = (80 / 100) * 100% = 80%
Insights About Renewal Rate
Renewal rate is a key metric for subscription businesses and indicates the success of the product, service, and customer experience.
A high renewal rate indicates that customers are satisfied and find value in the offering.
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