It is absolutely critical for any product manager to have a strong grasp on the meaning of retention rate.<\/p>\n
Being able to calculate retention rate, analyze what it means, understand the impact on customer loyalty, and figure out ways to improve customer retention<\/a> are all vital skills to master.<\/p>\n We\u2019ll be covering all of this in our article. Ready to get started?<\/p>\n The customer retention<\/a> rate refers to the overall percentage of users who keep paying for your product or service over a given time period.<\/strong><\/p>\n Product managers are busy people. Why should they spend their time calculating retention rates and diving into data? The following reasons explain why is it important to measure retention – no matter how much one is busy.<\/p>\n Keeping hold of existing customers is far more cost-effective than seeing your number of churned customers go through the roof, and having to figure out how to acquire new ones.<\/p>\n You want to build a retention strategy<\/a> that will retain customers for a long time – that way you’ll save significant costs.<\/p>\n <\/p>\nWhat does customer retention rate mean?<\/h2>\n
Why is it important to measure retention?<\/h2>\n
Customer retention is cheaper than customer acquisition<\/h3>\n