The customer repurchase rate – similar to retention rate and churn rate – is a performance metric that directly affects a business’s profitability. As a business owner, you might wonder how it can be measured and improved. How can a new customer be converted into a regular customer?

Here, we answer the most common questions about customer repurchase rates and explain what they can reveal about your business in France.

What’s in this article?

• What is the customer repurchase rate?
  
• Why should businesses in France measure it?
  
• How to calculate customer repurchase rate
  
• How to analyse customer repurchase rate
  
• How to increase customer repurchase rate
  

What is the customer repurchase rate?

A customer repurchase rate is the percentage of customers who make more than one purchase from a business within a specific time period, such as a year, quarter, or month. It’s an important measure of customer loyalty and satisfaction with a business.

Why should businesses in France measure it?

The repurchase rate helps a company assess its ability to maintain long-term relationships with existing customers. It addresses several important questions:

• Is the company able to maintain a stable customer base?

• Are customers satisfied with their purchases and overall customer experience?

• Does the marketing strategy increase customer loyalty?

• Do customers come back to make more purchases without being prompted?

From a financial perspective, the repurchase rate helps a business estimate predictable revenue and assess the effectiveness of promotional campaigns in the medium term. The repurchase rate is an important tool for making informed decisions that affect a company’s longevity, profitability, and brand image.

The Stripe Billing application programming interface (API) seamlessly integrates with your existing tools to help you boost customer retention and lower your churn rate. With personalised Stripe flows, you can enhance communication with new customers, optimise order management, and experiment with various pricing plans.

How to calculate customer repurchase rate

Follow these simple steps to calculate your business’s customer repurchase rate:

• Choose the period of time you want to analyse.

• Count the number of customers who made more than one purchase during the selected period.

• Count the number of customers who made their first purchase during the same period.

• Apply the following calculation formula:

(Number of Customers Making Repeat Purchases ÷ Number of Customers Making First Purchases) x 100

An example of customer repurchase rate

Let’s say you have 1,500 customers making a first purchase in October, and 420 of them make second purchases before the end of the month.

To calculate your repurchase rate, divide the number of customers who made repeat purchases by the total number of customers who made their first purchase over the course of the month. Then, multiply the result by 100 to express it as a percentage.

(420 ÷ 1500) x 100 = 28%

Your repurchase rate for October is 28%.

How to analyse customer repurchase rate

Ideally, a good repurchase rate is between 20%–30%. However, it’s important to consider industry standards and competitor figures, as average repurchase rates can vary based on factors such as industry, product or service price, seasonality, and consumer trends.

A high rate is a positive indicator: it shows customers are satisfied with the experience and quality of the product or service offered. A high repurchase rate suggests customers are likely to return and recommend the business’s products or services to their network, potentially driving word-of-mouth marketing and strengthening the brand’s positive image. A business with a strong repurchase rate can create brand ambassadors and build loyal customers for life. Learn how to calculate customer lifetime value in our related article.

On the other hand, a low repurchase rate suggests customers are distancing themselves from the business after making their first purchases. This result can indicate problems with the product or service, customer experience, or communication with customers, among other issues.

According to Alma, 44% of French shoppers abandon their shopping carts when their preferred payment method is not available. With Stripe, you can offer over 100 payment methods in France – including buy now, pay later (BNPL) – through a simple integration with Alma.

How to increase customer repurchase rate

To increase your repurchase rate, you can:

• Introduce loyalty schemes: Offer exclusive discounts for repeat customers, reward points, vouchers, special gifts, and a connected community.

• Improve the product or service: You can gather customer feedback through surveys, review the quality of your products or services, evaluate similar companies’ offerings to ensure competitive pricing, and develop products or services in line with customers’ evolving needs.

• Personalise communication with customers: Provide recommendations for new products or services based on past purchases, and offer advice on product use, functionality, or maintenance.

• Provide an easy and enjoyable customer experience: You can offer simple returns, high-quality customer service, multiple flexible payment options, free shipping, and a customer portal.

• Make repurchasing easier: Include buttons for easy re-ordering or offer a subscription model.