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From the Little Stream Software blog
There isn't one metric that perfectly identifies your repeat customer performance.
Combining two metrics though and you can get really close.
Repeat Purchase Rate and Customer Purchase Latency (latency) when combined can describe much of your success with repeat customers.
Repeat Purchase Rate shows the number of customers who re-ordered in a given time-frame. In other words, what percentage of customers decided to come back and order again?
Latency refers to how long it was since the last order. A latency of 30 days means that on average, your customers are placing another order 30 days later.
Repeat Purchase Rate shows how often customers come back, latency shows how long it takes. When combined you can now predict how many customers will come back in a time-frame.
There's your repeat customer performance right there.
Ideally you want Repeat Purchase Rate to be high (more customers coming back) and Latency to be low (less time in-between orders). Start optimizing and running tests to try to maximize those two and your store's customer base will improve.
Both of these can be emailed to you every week or every month as part of Repeat Customer Insights. This will help you stay on-track with your improvements.
Eric Davis
Learn what your customers are actually doing instead of just guessing
One of the best ways to build a sustainable business starts by getting your customers to come back. Mastering that simple process can be difficult, but builds a lifelong business.
Repeat Customer Insights can help you understand your customer's behavior. With its collection of behavior reports, you can see what they're actually doing instead of guessing and having your efforts fall flat.