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Glossary keyword - CRR (Client Retention Rate)

CRR (Client Retention Rate)

Customer retention stands for the ability of business, including a product or service, to retain its customers for a specific period of time. CRR (Client Retention Rate) indicates the percentage of customer retention. Retention rate, on its own, shows the percentage of customers that a company has lost over a given period. Metrics of customer satisfaction is the predictor of the CRR (Client Retention Rate).

How Is it Calculated?

Calculations of CRR is so crucial that it is the key performance indicator of a company. There is an easy way of calculation Client Retention Rate. To calculate, one needs to follow the given information:

CRR (customer retention rate) = ((EC-NC)/SC)*100

EC stands for the number of the customer at the end of the given period. NC is the number of clients during the given period. Also, SC indicates the number of clients at the start of the given period. There are also several CRR calculation application software and online services exist.

Customer Satisfaction 

Customer satisfaction is a critical factor in retaining clients. The higher the client retention rate is, the more is the customer satisfaction. In other words, the high result of the CRR (client retention rate) calculations indicates that the company was successful in meeting the customers’ satisfaction. 

Customer Retention 

The ability of the company or business to retain or gain new customers is not the only factor related to successful customer service. The point is that the company should keep servicing well to the currently existing customers. Client retention rate is an indicator of customer success retention. It means that the company was successful in giving what the customers need. 

CRR (client retention rate) also predicts the financial success of the company. According to a study, retaining and satisfying customers have a positive direct impact on the economic profit. The researchers used both the stock market and accounting calculations.

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