Welcome to our list of common Customer Success terms. Keep up with our continually evolving industry and empower yourself with the latest Customer Success terms, definitions, and knowledge.
Request DemoGross revenue retention (GRR) specifically focuses on revenue retention rather than customer retention,. Gross revenue retention measures how much of your monthly recurring revenue (MRR) you retain each month after you’ve subtracted the effects of churn or downgrades to lower-priced products, but not the effects of upgrades. Gross revenue retention can be calculation in monthly, quarterly or annually depending on your selling model and typical subscription term.
This can be mathematically expressed as a formula for monthly:
GRR = [(MRR from renewals – MRR lost due to churn – MRR lost due to downgrades) / MRR at the beginning of the month] * 100
To measure GRR, take your monthly recurring revenue from customers who renewed at the end of the month, subtract any revenue lost because of customers who stopped buying from you, switched to a lower-priced product, or in general, is purchasing less from you, and divide the result by your monthly recurring revenue at the beginning of the month. Multiply by 100 to convert the result to a percentage.
GRR = [(MRR from renewals – MRR lost due to churn – MRR lost due to downgrades) / MRR at the beginning of the month] * 100
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