If at the end of a period 120 users (out of 250) are actively using your product, and you acquired 60 extra users in the same period, the retention rate is 24%.
Retention rate measures the share of users who continue to use a product or service over a specified period of time. It is a key indicator of customer satisfaction and loyalty, as it shows how effectively a company is retaining its customers.
The typical components of a retention rate calculator are:
Total number of existing users at the beginning of the period
Total number of new users signed up during the period
Total number of users at the end of the period
To calculate your users' retention using these components, the formula is:
Retention rate = (Total number of users at the end of the period - Total number of new users signed up during the period) / Total number of existing users at the beginning of the period
