Metric: MRR Retention Rate

The Net MRR Retention Rate cohort analysis reports the rate at which MRR is renewed.

How is it calculated?

MRR Retention Rate = MRR of renewed subscriptions / Total MRR of subscriptions up for renewal

For example, if you had $1000 MRR at the beginning of the month and one customer contributing $100 MRR churned, before the end of the month, your MRR Retention Rate would be 90%.

You can have over 100% MRR Retention if the sum of Expansion MRR is greater than the sum of Churn and Contraction MRR. For example, if you had $1000 MRR at the beginning of the month, and lost $100 MRR to churn but gained $200 MRR from upgrades, your MRR Retention Rate would be 110%.

What analyses can be gained?

This cohort analysis is useful if you want to identify the factors that lead to upgrades or identify when a customer is likely to upgrade or downgrade their account. You can segment this cohort analyses using the segmentation tools. For example, you can see if a customer is more likely to renew if they regularly engage with your support team. 

Recommended reading: The Ultimate Cohort Analyses Cheat Sheet.


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