How to Calculate Customer Retention Rate (CRR) in Google Ads

7 minute read

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Are you struggling to keep your customers coming back? Do you want to know how to measure the effectiveness of your retention efforts? If so, you need to learn how to calculate your customer retention rate (CRR) in Google Ads. In this article, we’ll explain what CRR is, why it’s important, how to set up Google Ads for CRR tracking, and how to calculate and improve your CRR.

Understanding Customer Retention Rate (CRR)

What is Customer Retention Rate?

Customer retention rate (CRR) is the percentage of customers who continue to do business with you over a period of time. It measures your company's ability to retain customers and is a key metric for assessing the effectiveness of your retention strategies.

Let's dive a little deeper into what CRR is and why it's important for your business. Essentially, CRR is a measure of customer loyalty. It tells you how many of your customers are sticking around and continuing to do business with you, even after they've already made a purchase. This is important because loyal customers are more likely to make repeat purchases and refer others to your business, which can lead to increased revenue and growth.

But CRR isn't just about revenue. It's also about building relationships with your customers and creating a positive reputation for your brand. When customers feel valued and appreciated, they're more likely to stick around and become advocates for your business.

Why is CRR Important for Your Business?

A high CRR means that you have loyal customers who trust and value your products or services. This can lead to increased revenue, as loyal customers are more likely to make repeat purchases and recommend your business to others. Moreover, it’s cheaper to retain existing customers than to acquire new ones, which means that a strong CRR can help you reduce customer acquisition costs and improve your ROI.

Think about it: when you're trying to attract new customers, you have to spend money on marketing, advertising, and other outreach efforts. But when you're trying to retain existing customers, you can focus on providing great service, building relationships, and creating a positive experience. This not only saves you money, but it also helps you build a stronger, more sustainable business over time.

CRR vs. Customer Churn Rate

Another important metric to consider is your customer churn rate (CCR), which is the percentage of customers who stop doing business with you over a period of time. While CRR measures your ability to retain customers, CCR measures the opposite. It’s important to track both metrics to have a complete view of your customer base and identify areas for improvement.

For example, if your CRR is high but your CCR is also high, it could indicate that you're doing a good job of retaining some customers, but losing others due to issues with your products, services, or customer experience. By tracking both metrics, you can identify patterns and make changes to your business that will help you improve customer retention and reduce churn.

In conclusion, customer retention rate is a critical metric for any business that wants to build long-term relationships with its customers and achieve sustainable growth. By focusing on providing great service, building relationships, and creating a positive experience, you can improve your CRR and create a loyal customer base that will help your business thrive.

Setting Up Google Ads for CRR Tracking

Creating Conversion Tracking in Google Ads

The first step in setting up CRR tracking in Google Ads is to create conversion tracking for the actions that indicate a customer has returned. This could be a purchase, a signup, or any other action that indicates loyalty or engagement. Once you’ve set up the tracking, you can segment your audience based on these conversions and analyze their behavior over time.

Defining Your Customer Retention Goals

Before you start tracking your CRR, you need to define what success looks like for your business. This means setting goals for how much you want to improve your retention rate and by when. By having clear, measurable objectives, you can monitor your progress and adjust your strategies accordingly.

Setting Up Audience Segments for Retention Analysis

You can use audience segmentation in Google Ads to group customers based on their behavior and engagement levels. This allows you to analyze retention rates for different groups and identify areas for improvement. For example, you may want to segment customers by the date of their last purchase, their product preferences, or their geographic location.

Calculating Customer Retention Rate in Google Ads

Identifying Returning Customers

In order to calculate your CRR, you need to identify the number of customers who have made repeat purchases or engagement actions. You can do this by comparing the number of unique users who have converted more than once within a certain time frame to the total number of users who converted at least once during that time frame.

Analyzing Customer Retention Metrics

Once you know your CRR, you can analyze other retention metrics to get a more complete view of your retention efforts. Some useful metrics to track include average order value (AOV), customer lifetime value (CLTV), and churn rate.

CRR Calculation Formula

The formula for calculating CRR is:

CRR = (Number of Customers at the End of a Period - Number of New Customers) / Number of Customers at the Start of the Period) x 100

Strategies to Improve Customer Retention Rate

Enhancing Customer Experience

One of the most effective ways to improve your CRR is to provide an exceptional customer experience. This means listening to feedback, addressing pain points, and going above and beyond to exceed expectations. By creating a positive experience for your customers, you can increase their loyalty and encourage repeat business.

Implementing Targeted Remarketing Campaigns

Remarketing campaigns allow you to reach out to customers who have previously interacted with your business and encourage them to return. By using data from your CRR analysis, you can tailor your remarketing campaigns to specific segments of your audience and provide personalized messaging that resonates with their interests and needs.

Offering Incentives and Loyalty Programs

Another effective way to increase customer retention is to offer incentives and rewards for loyalty. This could be in the form of discounts, free products, or exclusive access to new products or services. By providing tangible benefits for returning customers, you can strengthen the emotional bond they have with your brand and encourage them to continue doing business with you.


In conclusion, calculating your customer retention rate is a crucial step in assessing the performance of your retention efforts and identifying areas for improvement. By setting clear goals, segmenting your audience, and analyzing your retention metrics, you can develop strategies to enhance the customer experience and encourage repeat business. By keeping track of your CRR and implementing effective retention strategies, you can build long-term relationships with your customers and grow your business over time.

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