What is a Good Returning Customer Rate?
Table of Contents
Return customer rate is one key performance metric that indicates loyalty and repeat purchase behavior.
In this article, we’ll break down what this metric is, why it matters, benchmarks by industry, and strategies to improve it.
What is the Returning Customer Rate?
The returning customer rate (RCR) is the percentage of customers who make more than one purchase from your store over a specific period. It measures customer loyalty and helps businesses understand how well they retain customers after the first sale.
The formula is simple:
If 200 out of 1,000 customers make repeat purchases:
Returning Customer Rate (%) = (200 ÷ 1000) × 100 = 20%
This means 20% of your customers returned to make another purchase.
What is a Good Returning Customer Rate?
A good returning customer base usually falls between 20% and 40% of the total customers. This means that out of every 100 customers, 20 to 40 are likely to make repeat purchases—a clear sign of loyalty and satisfaction.
However, this is not a fixed rule or one-size-fits-all. Different industries, business models, and product types have unique purchase patterns. Consider this range relative to your industry and growth stage, and track changes over time to measure the effectiveness of your strategies rather than focusing solely on hitting a fixed number.
How to Increase Repeat Customer Rate?
Studies show that returning customers spend more per order and are far cheaper to retain than acquiring new ones. By focusing on nurturing relationships after the first purchase, you can unlock a steady stream of revenue and brand loyalty.
Below are some of the best practices you can try:
Offer Personalized Experiences
Instead of sending the same message to everyone, you make customers feel recognized and valued through personalized marketing.
Start by segmenting your customers according to their buying patterns. Send product recommendations that align with their interests, use their name in emails, or offer special discounts on items they’ve shown interest in before.
Implement a Loyalty Program
A loyalty program is a strategy where you reward customers for repeat purchases or engagement with your brand.
To make this effective, design a program that’s simple to understand and easy to join. Offer points for every purchase, provide exclusive access to sales or new products, and allow points to be redeemed for discounts or free products. Regularly remind customers of their progress and rewards to keep them engaged and returning for more.
Improve Post-Purchase Experience
Improving post-purchase experience focuses on making the customer journey smooth and memorable even after the sale is completed.
You can send timely shipping notifications, provide clear instructions for product use, and follow up to check satisfaction. Adding a small thank-you note or an unexpected freebie can leave a lasting impression that motivates customers to shop with you again.
Communicate Regularly Through Email and Messaging
Regular communication is when you stay in touch with customers through emails, SMS, or app notifications. Make sure the messaging frequency is consistent but not overwhelming. Personal touches, like referencing their last purchase or interest, make the communication feel more meaningful and less like generic marketing.
Provide Exceptional Customer Service
Exceptional customer service ensures every customer interaction is smooth, helpful, and satisfying. Focus on being responsive, attentive, and empathetic. Train your team to handle issues professionally and follow up to ensure satisfaction. Offering multiple channels for support, such as chat, email, or phone, makes it convenient for customers to reach you.
Final Thoughts
Returning customer rate reflects your store’s ability to build lasting relationships. Tracking it alongside other key metrics like customer lifetime value (CLV) and churn rate provides a holistic view of your business’s health.
Aim for steady improvement by understanding your customers’ needs, offering value, and creating an experience that keeps them coming back.
Further Reading
What is a Good Returning Customer Rate FAQs
Is 90% customer retention good?
Yes, 90% retention is excellent. It indicates that nearly all your customers are staying loyal and returning to purchase, which is rare and highly valuable for long-term revenue.
What is a good returning customer rate on Shopify?
A good returning customer rate on Shopify typically ranges from 20% to 40%. This shows that a healthy portion of your customers are coming back to make repeat purchases, which indicates strong loyalty and engagement.
Is a 30% customer return rate good or bad?
A 30% returning customer rate is considered good. It means that nearly one-third of your customers make repeat purchases, which is a positive sign of loyalty and satisfaction.
What is a high level of customer returns?
A high level of returning customers depends on the industry, but generally, a returning customer rate above 40% is considered very strong. For products with infrequent purchases, even 20–30% can be significant.
What is a good return rate for a website?
For product returns, a return rate of 5–10% is generally considered healthy. High return rates may indicate issues with product quality, descriptions, or customer expectations.
What is a good refund rate in eCommerce?
A good refund rate is usually under 5%, showing that most customers are satisfied with their purchase and the product meets expectations.
What is CRR in eCommerce?
CRR (Customer Retention Rate) measures the percentage of customers who continue buying from your store over a period. It’s closely related to returning customer rate and is a key indicator of loyalty and long-term revenue.
What is the 80/20 rule in customer retention?
The 80/20 rule in customer retention means that 80% of your revenue often comes from 20% of your loyal customers. It highlights the importance of retaining your best customers to maximize profitability.
Tracy is a senior content executive at TrueProfit – specializing in helping eCommerce businesses scale profitably through content. She has over 4 years of experience in eCommerce and digital marketing editorial writing. She develops high-impact content that helps thousands of Shopify merchants make data-driven, profit-focused decisions.
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